EUDIS aims to enable the establishment of Innovation Test Hubs across the European Union by allowing consortia selected under the European Defence Fund (EDF) to finance innovative SMEs and start-ups without necessarily having previous experience operating in the defence sector. This will be done by adding funding for the Financial Support to Third Parties (FSTP)/cascade funding to the EDF grant.
The EDF grant beneficiaries will be required to provide Financial Support to Third Parties (FSTP) in accordance with the conditions set out in the EDF call text.
Rewards & Benefits
Easier access to EDF funding: Cascade funding simplifies and streamlines the funding application process for SMEs. It eases and improves access for smaller market players into the EDF.
Benefit from industry expertise: SMEs can connect with various industry stakeholders and benefit from activities that can solely be offered by consortia.
How does it work?
Every year, a consortium in receipt of an EDF grant which includes also FSTP/cascade funding will be required to organise up to two distict calls to third parties, targeting a minimum of 10 and maximum of 20 entities per call, depending on the industrial landscape of the targeted domain. Each third party may be supported with up to EUR 60,000 for a maximum 6-months’ acceleration programme that encompasses the associated tasks as described in the EDF call text.
FSTP/cascade funding must target in priority SMEs, including start-ups. Participation of entities other than SMEs can only be accepted where no SMEs are available to demonstrate the capacity or expertise needed for the project during its lifetime.
When consortia will organize a cascade funding call for start-up companies?
EDF 2024 includes one Research Action in the Simulation & Training category on the topic Methods for bridging reality gaps, where up to 16% or EUR 2,400,000 of the total call topic budget may be allocated as FSTP.
Apply here for the 2024 Call as Organiser:
Methods for bridging reality gaps - EDF-2024-RA-SIMTRAIN-BRG-STEP
For the current EDF 2024 calls for proposals, it is envisaged that the successful consortium will receive a grant in the second half of 2025. The consortium that will implement the EDF project will organize cascade funding call(s) for SMEs and startups during the project implementation.
For example, if the project implementation will take place for 36 months, i.e., from 1 December 2025 – 30 November 2028, the consortium will organize one or two cascade funding calls for third parties, being SMEs and start-ups, during that time. It is up to the EDF consortium to decide on the precise timing. This call is carried out under the guidance of the European Commission.
The EDF consortium will advertise, select, award SMEs or start-ups and provide a set of support services.
Information on the 2023 Call:
The EDF 2023 round of call for proposals included one category of Development Action in Materials & Components.
The winning consortium is MaJoR, which received funding of EUR 30,000,000 for the project, of which EUR 3,600,000 or 12% is allocated to the FSTP portion.
Cascade funding, also known as financial support to third parties (abbreviated to FTSP), provides EU funding to beneficiaries. A consortium receives EU funding, following a regular competitive call procedure under the EDF programme, which is then provided to small players (such as SMEs) through a “call for third parties”. This call is organised by the consortium, not the Commission.
Cascade funding aims to foster cross border defence innovation networks in specific technology areas in Europe. In 2023, it is available under the Materials & Components category of the 2023 EDF Work Programme. Specifically, beneficiaries of FSTP should contribute with a joining or repair or maintenance technology must receive financial support to prepare a sample of their technology, to attend and support the testing of their technological sample, and to technologically improve their solution. FSTP may also be provided to entities that contribute with analysis and measurement capacities, technology-specific expertise, innovative tools, or support the manufacturing of technology test samples or components necessary for testing. The proposals must include technical mentoring for the selected beneficiaries of the FSTP as well as the set-up of additional measures to support the beneficiaries business case.
It is expected that FSTP will improve innovative SMEs and small players’ access to the EDF. Through working with consortia, the application process for funding is simplified and access to funding is streamlined. It also allows for small players to connect with a variety of industry stakeholders and benefit from a broad range of activities than be offered by consortia, including hands-on guidance. We aim to improve of the business environment and collaboration opportunities for innovative start-ups and SMEs in the defence domain by supporting open innovation and involving innovative actors and customers from different sectors and countries.
The first cascade funding calls for start-ups and SMEs can be expected starting from 2025. These calls with be organised by the selected consortium that will receive a grant from currently open call for proposals in the Materials and Components category under the EDF 2023 Work Programme.
Please consult the EDF Work Programme 2023. The information on the calls with FSTP is also published in this website.
The ceiling for the financial support to third parties (including SMEs) is EUR 60 000 per third party.
The call will be organized by the EDF grant beneficiary - a consortium that will implement an EDF project with FSTP. The grant beneficiaries of the EDF calls for proposals from 2023 will be known in Summer 2024.