What we do
CMP offers comprehensive advice on obtaining funding.
Modern businesses must overcome complex challenges if they are to survive into tomorrow’s market.
- Competitors are everywhere
- Product life cycles are becoming shorter
- Ideas must be developed and brought to reality faster
- Time to market
- Pressure on financing is increasing
Often the main problem is finding the finance for the essential innovation and investment. That's where public funding comes in. Government grants can play a temporary stabilising role in the financing mix of a company.
But who is entitled to them? On what terms? How does a company go about applying for funding? To whom can I turn?
CMP is the specialist in funding consultancy. We support our clients throughout the funding process.
CMP scours the funding landscape and doesn’t just tell you where there might be grants for companies, but also accompanies you on the journey all the way to the goal – from application to allocation.
Our funding consultancy is also available when it comes to accessing and using the funding in the project phase in compliance with guidelines. As an independent clearing body, CMP handles project coordination for the funding of large R&D joint ventures with project partners from industry, research and academia.
Every search for funding assumes that the following conditions are met:
- The project must not under any circumstances start before the application is submitted.
- Allow for the time factor when applying. It may take several months from the initial discussion until funding is approved.
- The company must not be at risk of insolvency. Companies at risk of insolvency will never be given government grants.
- Funding does not eliminate the entrepreneurial risk. At best, it can only provide support.
- The company will be expected to make a reasonable financial contribution of its own. This shows trust in what they are doing.
- Transparency and the disclosure of all relevant data must be guaranteed. All problems will ultimately come to light – and can then have a delaying effect.
Schülke & Mayr GmbH
„CMP has already led us through the complex process of applying for funding on several occasions. Many years of experience coupled with great technical expertise and the ability to adjust optimally to our situation and our needs – that’s something we particularly value, alongside the pleasure of working with the CMP team.“
Dr. Peter Oltmanns
Director Research and Regulatory Affairs
The 4 pillars of public funding
These include low-interest loans from public development banks that are extended through the house bank. In addition to the generous interest rates, other advantages in investment and innovation projects include repayment-free years and a fixed interest rate across the whole term.
These loans also offer good opportunities for public protection through indemnities. However, there is no legal entitlement to a low-interest loan.
Guarantees and indemnities
A public sector institution acts as guarantor, providing security for a financing proposal. Guarantees are instruments of the guarantee banks (e.g. LfA) or the government that serve primarily as a means of reducing the default risk for the house bank. However, the applicant is not released entirely from their liability: usually the financing bank will not guarantee more than 80% of the amount.
Classic equity investment options of the government generally have the following features:
- Usually minority stakes, even in a restructuring scenario
- Fixed investment period
- Priority is given to safeguarding jobs and keeping technology in Germany
- They differ from private equity in having more favourable terms
Subsidies are non-repayable funds for innovation and investment projects. These are earmarked sums with a commitment period of five or seven years. SMEs are given preferential status in the awarding of government funds for businesses. Allocation is at the discretion of the funding body, so there is no legal entitlement. Regional policy objectives and the budget situation of the funding body play a key role. There are two basic models.
a) Investment subsidies
Government funds for businesses can be used for the following investment purposes:
- Purchase of new machinery/erection of engineering facilities
- Erection and expansion of a business establishment
- Diversification in production
- Fundamental change in production (conversion, rationalisation, modernisation)
- Acquisition of a business establishment that has closed or is threatened with closure
- Safeguarding/creation of jobs
Important: Not all costs are eligible for funding. The investment period considered for government funds for businesses is no more than 36 months.
b) Innovation subsidies
Focus on industrial research
- Planned research and critical exploration for the development of new or improved products, processes and services
- Up to 50% government funding is available
Focus on experimental development
- Implementation of findings through to specimen/demonstration
- The industrialisation of a demonstrator into a product ready for series launch requires additional development expenditure in a downstream project phase
- The funding ratio depends on the funding programme
Key factors for obtaining government funding for projects focused on experimental development and industrial research:
- Does not depend on the location and size of the company
- Not all costs are eligible for funding
- Maximum period 36 months
Key questions that need to be answered if government funding for projects focused on experimental development and industrial research is to be obtained:
- What is the state of the art?
- What is the innovative feature of the project?
- What are the possibilities of exploitation?
- What effects will be achieved?
The 5 phases of the process
Phase 1: Preliminary check of fundamental eligibility for funding
Based on the outline of the project as provided by the client, CMP carries out a basic search for relevant funding programmes. During the search CMP investigates fundamental funding approaches and options.
It looks at programmes managed by the EU, the German government and individual federal states, including the associated prerequisites and framework conditions.
Clarification is obtained from the client on what type of funding (subsidy, loan, etc.) is most suitable for the proposed project. The proposal is then evaluated from the results of the basic search and a funding estimate is compiled for the client.
Phase 2: Presentation to the project sponsor
If a specific funding option has been identified in the preliminary check, CMP works with the client to produce an ideas paper for presenting the proposal to the competent project sponsors or federal or regional ministries.
An ideas paper gives a brief overview of the proposal and can be an 8 to 10-page description or presentation. The ideas paper is submitted to different funding bodies, as the proposal may have a variety of eligible aspects and hence fit a number of different programmes.
If the project sponsor is interested in the proposal, the project is then presented to the responsible staff in detail in a face-to-face meeting. If this meeting goes well, a request to submit an application is generally made.
The following are essential for the success of a funding application:
- Creation of an ideas paper
- Contact with the project sponsor
- Structuring of the project
- Creation of the complete documentation
- Assistance in project management and controlling and in the search for partners
- Support for all applicants
- Communication with the ministries and project sponsors
Phase 3: Application for funding
A large number of documents (description of the proposal, Gantt chart, cost structure, possible annexes, etc.) for the application are prepared and revised, usually in the form of a workshop. CMP supports the client by taking over complete management of the project, drafting the application in compliance with guidelines, coordinating project meetings with other partners and, if necessary, drafting the project documentation. Phase 3 ends with the submission of the full funding application and answering any queries that may be raised by the project sponsor.
CMP focuses on the following tasks:
- Assistance in project management and controlling and in partner management
- Coordination of project meetings
- Funding networking
- Project communication
- Drafting an application that is compliant with guidelines
Phase 4: Allocation of the funds in the event of a successful application
CMP inspects the grant notice and writes a concluding letter to the client.
The content and the resulting rights and obligations under the grant notice for the funding application are discussed in detail in the subsequent kick-off meeting with the client and project sponsors.
CMP provides the following support:
- Inspection of the grant notice incl. all annexes
- Deadline coordination
- Organisation kick-off (internal)
Phase 5: Follow-up support after the project has started
The grant notice for the funding application imposes a number of duties on the client, such as the regular preparation of interim proofs of use. Before funds can be received, they must be called for. CMP assists the client in the entire funding project through to preparation of the final report at the end.
CMP performs the following tasks after the grant notice has been received:
- Deadline monitoring during the project term
- Assistance in the preparation of the relevant documents – from the first call for funds to the final report
- Possible project meetings with the project sponsors
Funding Project Coordination
One of the main challenges in joint ventures is combining and coordinating the various project partners, their service providers and the general public. The aim is to establish a transparent and verifiable process in the project and to ensure the success of your venture over the entire project period. That is why CMP Financial Engineers offers to coordinate projects from a funding point of view as an additional part of its portfolio of services.
CMP covers the following aspects within a funding project:
- Project coordination
- Project communication
- Project controlling
- Public communication
Project coordination includes the following, among other content:
- Preparation and moderation of a project kick-off event following receipt of the grant notice
- Consultation with the project sponsor on the communication requirements
- Consultation and support in the establishment of a suitable communication tool for internal and external communication in the project
- Consultation and support in the establishment of the CI/CD for the project in order to create a consistent project image for communication
- Cultivation of project-related contacts with ministries, project sponsors and associations during the project period
- Screening of project-related events and their integration into the PR activities
- Provision of support for the project manager through continuous project controlling
- Monitoring of deadlines and time periods
- Monitoring of interfaces between all relevant stakeholders
- Organisation and moderation of regular project meetings with follow-up afterwards