article written by Isabelle Chéry
The article “I for Incubation, the basics” presented the conditions for entering the SATT Linksium incubation programme as well as the six areas of accompaniment. As a reminder, the areas of support in Incubation concern:
1. At the technological level, the development of the future product or service;
2. The identification of product/market pairs and their prioritisation;
3. Strengthening of the entrepreneurial team if necessary and distribution of roles/missions, capital and power;
4. The legal environment and Intellectual Property (for the creation of the company and its contractual relations of any kind, technology transfer);
5. Communication (development of identity and notoriety, etc.);
6. The financial dimension (financing plan, financial forecasts, fund raising, etc.),
All of these six areas should form a coherent whole, articulated at the strategic and operational levels, and formalised in a Business Plan (BP).
The purpose of this article is to complete this information and to present the financing conditions by SATT Linksium, the conditions of reimbursement by the future start-up, the selection process for start-up creation projects as well as the contractualisation. The text has been validated by Christine Vaca, Head of the Incubation Unit at Linksium, and we warmly thank her.
III- FUNDING CONDITIONS
The SATT supports start-up creation projects according to the following financial terms:
- Incubation support for an average of 14 months, worth €30k. This includes around 100 hours of personalised support per year provided by an entrepreneurial coach (Incubation Coach), a training programme of more than 50 days per year, access to tools and platforms for recruiting partners, financial forecasts, sectoral market studies, opportunities to meet with investment funds, access to a co-working space, etc.;
- An initial financial envelope in the form of a reimbursable of a €30k advance excluding tax towards technological developments for the future product or service: this envelope is used either to finalise the prototype (in which case subcontractors can be used or material and small equipment can be purchased) when the project is a Maturation project. Alternatively, if the project is not the result of a Maturation project, a different €60k (excluding AT) envelope can be used to finance a laboratory in the form of an investment grant as part of a Flash Technological Maturation ( FTM) to carry out an innovative development that the future start-up needs;
- A second financial envelope in the form of a €50kmaximum reimbursable advance (excluding tax) for “market” oriented services (experiments and/or market studies, participation in conferences and trade fairs, visits to potential clients, sales coaching, etc.), “communication” (logo and graphic charter, website, videos, etc.), “legal” (advice and support for the start-up, etc.) and “marketing” (marketing and sales support, etc.). ), “legal” (advice and drafting of legal statutes and shareholders' agreement, general terms and conditions of sale, first employment contract, commercial and distribution contracts, licence agreements, patentability and prior art studies, freedom to operate studies, assistance in drafting patents, etc.), “industrialisation” (sourcing, cost control, etc.), “design”, “regulatory”, etc.;
- At the start-up’s creation, a systematic 10%
investment of the initial share capital (capped at €10k) in all start-ups that benefit from the Incubation in order to generate income in the event of resale of the investment. This revenue stream is particularly important for Linksium, which must eventually achieve financial autonomy in order to continue to support and invest in laboratories in new maturation and start-up creation projects.
- Incubation support for an average of 14 months, worth €30k. This includes around 100 hours of personalised support per year provided by an entrepreneurial coach (Incubation Coach), a training programme of more than 50 days per year, access to tools and platforms for recruiting partners, financial forecasts, sectoral market studies, opportunities to meet with investment funds, access to a co-working space, etc.;
- An initial financial envelope in the form of a reimbursable of a €30k advance excluding tax towards technological developments for the future product or service: this envelope is used either to finalise the prototype (in which case subcontractors can be used or material and small equipment can be purchased) when the project is a Maturation project. Alternatively, if the project is not the result of a Maturation project, a different €60k (excluding AT) envelope can be used to finance a laboratory in the form of an investment grant as part of a Flash Technological Maturation ( FTM) to carry out an innovative development that the future start-up needs;
- A second financial envelope in the form of a €50kmaximum reimbursable advance (excluding tax) for “market” oriented services (experiments and/or market studies, participation in conferences and trade fairs, visits to potential clients, sales coaching, etc.), “communication” (logo and graphic charter, website, videos, etc.), “legal” (advice and support for the start-up, etc.) and “marketing” (marketing and sales support, etc.). ), “legal” (advice and drafting of legal statutes and shareholders' agreement, general terms and conditions of sale, first employment contract, commercial and distribution contracts, licence agreements, patentability and prior art studies, freedom to operate studies, assistance in drafting patents, etc.), “industrialisation” (sourcing, cost control, etc.), “design”, “regulatory”, etc.;
- At the start-up’s creation, a systematic 10%
investment of the initial share capital (capped at €10k) in all start-ups that benefit from the Incubation in order to generate income in the event of resale of the investment. This revenue stream is particularly important for Linksium, which must eventually achieve financial autonomy in order to continue to support and invest in laboratories in new maturation and start-up creation projects.
IV- REPAYMENT CONDITIONS
Repayment of the repayable advances is made between the third and fourth year after the start-up’s creation.
The holder of the business creation project undertakes:
o the reimbursement by the future start-up in cash of the two Incubation financial envelopes used up, which amount to a maximum of €110k excluding tax (€60k excluding tax for technical expenses + €50k excluding tax for other types of expenses)
o compensation for the maturation investment financed by the SATT (prior to Incubation) by financial returns negotiated in the framework of a sub-licence of the technology from the SATT to the start-up.
The financial amount linked to the support provided by SATT Linksium during the Incubation phase does not give rise to repayment as it represents Linksium’s investment as a co-founder via its 10% stake in the start-up’s capital.
The holder of the business creation project undertakes:
o the reimbursement by the future start-up in cash of the two Incubation financial envelopes used up, which amount to a maximum of €110k excluding tax (€60k excluding tax for technical expenses + €50k excluding tax for other types of expenses)
o compensation for the maturation investment financed by the SATT (prior to Incubation) by financial returns negotiated in the framework of a sub-licence of the technology from the SATT to the start-up.
The financial amount linked to the support provided by SATT Linksium during the Incubation phase does not give rise to repayment as it represents Linksium’s investment as a co-founder via its 10% stake in the start-up’s capital.
V- PROJECT SELECTION
For projects originating from a public institution (i.e., Maturation project in a Laboratory), the Start-up Project Sponsor fills in an application form with the help of its Incubation Coach and submits its application for direct appraisal by the Investment Committee (IC) of SATT Linksium. The IC issues an opinion on the projects to be financed. The IC is chaired by the SATT President of SATT and is composed of expert and independent professionals (representatives of seed funds, Directors of Competitiveness Clusters, Innovation Managers of large groups, etc.). It meets every two months.
For external projects, the company creation project leader fills out an application file with the help of his or her Incubation Coach for an initial presentation to the Project Preview (PP) committee. The role of the PP is to make recommendations on the project with a view to its review by the IC. It is a milestone in the integration process of Incubation projects, allowing them to move from the detection stage to the IC preparation stage. The PP consists of a project pitching session followed by a question-and-answer session, in the presence of SATT staff (business managers from the Maturation, Incubation and Commercialisation divisions) in order to give operational recommendations on how to strengthen the project with a view to presenting it to the Investment Committee one or two months later. Between the PP and the IC, the application file is prepared by the Sponsor with the help of the Incubation Coach in order to take the recommendations into account. The PP meets every month.
For external projects, the company creation project leader fills out an application file with the help of his or her Incubation Coach for an initial presentation to the Project Preview (PP) committee. The role of the PP is to make recommendations on the project with a view to its review by the IC. It is a milestone in the integration process of Incubation projects, allowing them to move from the detection stage to the IC preparation stage. The PP consists of a project pitching session followed by a question-and-answer session, in the presence of SATT staff (business managers from the Maturation, Incubation and Commercialisation divisions) in order to give operational recommendations on how to strengthen the project with a view to presenting it to the Investment Committee one or two months later. Between the PP and the IC, the application file is prepared by the Sponsor with the help of the Incubation Coach in order to take the recommendations into account. The PP meets every month.
VI- CONTRACTUALIZATION
The financing by SATT Linksium and the reimbursement conditions are formalised through the Incubation Agreement. This agreement is signed between SATT Linksium, the project leader and the potential co-leaders. The Incubation Agreement defines more broadly the conditions under which the project owner, the Co-sponsor(s) and SATT Linksium collaborate on the project Incubation. It describes the process of support and monitoring of the Incubation project by SATT Linksium. Finally, it defines the terms and conditions under which SATT Linksium will support the holder(s) in the creation of the future company.
Do you have a question? Please feel free to contact Isabelle Chéry, in charge of technology transfer / valorisation at Grenoble INP (isabelle.chery@grenoble-inp.fr)
Do you have a question? Please feel free to contact Isabelle Chéry, in charge of technology transfer / valorisation at Grenoble INP (isabelle.chery@grenoble-inp.fr)
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