Young entrepreneurs play an important role in promoting social change and innovation.
New products and services created by entrepreneurs can cause a domino effect and stimulate business or certain business sectors
Therefore, young entrepreneurs are important to stimulate economic growth. But if it is already hard for an experienced entrepreneur to navigate firmly in the ocean of entrepreneurship, for inexperienced young people it can be a very tortuous journey and without a clear end of success.
The good news in this whole scenario is that this situation is known by the interested and involved parties, see the administration or government entities stimulating access to aid or subsidies to give that necessary push to young entrepreneurs.
By identifying financing as one of the biggest obstacles to the creation and development of companies, young entrepreneurs have the possibility of financing a business with subsidies and grants.
Are you going to undertake it in 2020? Keep reading and find out how you can strengthen and soften the creation of your business.
How to finance a business with grants and grants
As we have said, financing is a great stumbling block to undertake. Aid and subsidies are a good resource to stimulate decisions and business creation.
Each year, new grants and subsidies arise to facilitate the investment and financing of young entrepreneurs. In other words, fulfilling the requirements, you will get the money that will come in handy for your goals.
If your entrepreneur profile matches the selected subsidies or grants, you can request and access it. But everything is not so easy! You must consider a number of issues:
- The grant must be a complement to your business, not the basis for its development.
- The award of a subsidy takes time and does not always entail an answer is affirmative.
- The sooner you send it the better, the resolution is in order of presentation.
- In the case of investments, you must advance the money and if it is granted it will be paid later.
It’s clear! They are not perfect, but they are a good financing tool. Let’s look at some of the most common and important grants that you can access.
Aid and Subsidies for the creation of companies and entrepreneurs
Enisa Help for Young Entrepreneurs
Enisa is a public company dedicated to the financing of businesses, companies and viable business projects.
It offers various financing streams, being this Enisa help for Young Entrepreneurs very attractive.
We tell you a little more about its details:
- Designed for new SMEs created by young entrepreneurs.
- This SME must be constituted according to the definition of the European Union.
- Creation date two years before (maximum) prior to requesting assistance.
- Limited for the financial sector and in some cases of the real estate sector.
- The activity must be carried out in the national territory.
- Type of financing aimed at the acquisition of fixed and current assets.
- Minimum amount € 25,000 and maximum € 75,000
Aid and subsidies for the creation of Innovative Companies
In another article, we have emphasized the importance of innovation as a factor to consider for a profitable business.
In this case, there are certain grants or subsidies focused on the topic of innovation and technology.
Aid for innovation for technology-based companies (EBT)
Technology-based companies (EBTs) are those whose activity focuses on products or services that require the use of technologies or continuous innovation.
It is a kind of special help that requires a well-worked and detailed business plan.
It can have different versions and variations depending on the Autonomous Community. For example, for 2018, the grants for technology-based companies (EBT) in the Principality of Asturias consisted of these characteristics:
- The minimum eligible amount of € 20,000.
- The maximum amount of € 100,000 or 10 times the capital paid up before the application is submitted.
- Constitution less than 5 years at the time of application.
ICO loans for companies and entrepreneurs
The ICO is the Official Credit Institute whose objectives and challenges promote economic activities and their growth. This work is done by two-way means:
- Mediation Lines
- Direct financing.
It is a type of public financing; they allow to finance business projects in national territory and guarantee 100% of liquidity.
Some features of these ICO financing lines are:
- The maximum amount per customer and year is € 12.5 million.
- The most common financing tasks are the purchase of companies, fixed assets, leasing for investments, etc …
The best way to understand what they are and what the different ICO financing lines offer is to contact the ICO. According to its own slogan: There is an ICO financing for each type of company.
European funds to help entrepreneurs
Not only at the national level is it possible to apply for grants and subsidies for young entrepreneurs. The European framework also provides us with a very interesting kind of help.
For example, the Horizon 2020 program, already includes a budget of 76,880 million euros for the financing of business projects linked to research and innovation.
On the other hand, we can find the COSME project. It aims to facilitate small and medium-sized enterprises (SMEs) to access financing at all stages of their life cycle: creation, expansion or transfer of business.
This program also aims to help companies access the opportunities offered by digital technologies.
All European financing projects make the EU financial instruments available for channeling through local financial institutions in the EU countries.
The grants and subsidies for the financing of business projects are a very good resource to stimulate entrepreneurship, especially in young people.
It is true that this kind of aid is not going to help business success, it is simply a complementary contribution to the growth of the project. On many occasions, the help comes quite later in relation to the date of your application. Therefore, it is a priority to be clear that a subsidy should not be the axis of your business engine.
For the rest, these injections of “capital” are effective to develop stronger business strategies and open new opportunities. Know well and go ahead!