Need to scale your tech business and need additional funding to build a minimal viable product (MVP)? Now it’s the perfect time. The NSW  government has brought back the MVP Ventures Grant program on the 4th December 2023. Eligible businesses can receive up to $50,000 from the NSW government, which is significantly lower than the previous maximum grant size of $200,000. This article summarises key information about the eligibility criteria, what the money can be used for and how you can apply for this funding.

The MVP Ventures Program

The MVP Ventures Grant is run by the New South Wales government and is designed to support innovative startups and medium enterprises (SMEs) in NSW commercialise new and innovative products or processes. For the next 4 years until 2027, a total of $3 million per year is being offered, with grant size ranging from $25,000 to $50,000.

Please note that Investment NSW will be closed for Christmas between the 25th Dec 23 to 5 Jan 24, and that any applications submitted during this period will be subject to an additional 10 business days to assess.

Applications for Round 1 open: 4 December 2023 

Applications for Round 1 close: 4:30pm AEST, 30 April 2024

Key Eligibility Criteria for Businesses 

Your business must:

• possess an Australian Business Number (ABN) and be non-tax exempt;
• be headquartered in NSW;
• have an account with an Australian financial institution;
• hold intellectual property or rights to commercialise;
• have an Aggregated Turnover of less than A$1 million for the past three financial years prior to the lodgment of the application;
• be an entity (or subsidiary of a group of companies) that has less than 20 full time employees; and
• be a company that is incorporated in Australia or an incorporated trustee on behalf of a trust in Australia. 

The grant cannot be given to individuals, unincorporated corporations, trusts, partnerships, and those already receiving other NSW (or federal assistance) for the same purpose.

Project Eligibility

The full project eligibility criteria can be found in the Program Guidelines, but at a high level, the following are some of the key criterias:

• The project must:
  • be related to the commercialisation of your product/service
  • involve progressing your product/service along the  Technology Readiness Level (TRL) scale between 3 and 9 (Useful calculator can be found here)
  • be completed within 12 months of being funded
  • be aligned with one of the following priority industries:
    • Agriculture and Agrifood
    • Resources
    • Defence and Aerospace
    • Clean Energy and Waste
    • Medical and Life Sciences
    • Digital Systems and Software
    • International Education
    • Visitor Economy
    • Advanced Manufacturing
    • Biotechnologies
    • Digital Technologies

Furthermore, your business must demonstrate a minimum of 50% cash co-contribution (i.e if your business requests $10,000 and the total cost of the project is $20,000, you will need to contribute the other $10,000 (excluding GST))

The project should only include Eligible Expenditure and non-cash contributions cannot be used to match funding. (Accepted evidence of co-contribution include letter or bank statement from Financial Institution that is dated within the last 30 days, or a duly executed Investor Agreement  under NSW law, that may be conditional on receiving the MVP Venture Grant). 

As part of your application process, you must nominate a Validating Entity that will validate that your project is eligible. The Validating Entity can be one of the following:

• Company incorporated in Australia; or
• Statutory corporation; or
• Incorporated trustee on behalf of a trust in Australia; or
• Publicly Funded Research Organisation.

The Validating Entity must be able to demonstrate that they hold the requisite technical or industry expertise in the field that your product or process is being developed.

Examples of eligible projects

• Pilot and prototyping
• Showing commercial viability of a new innovative product/process to customers or investors
• Completing the development of an innovative product/environment
• Demonstrating product/process in operational environment

Examples of ineligible projects

• Developing products/processes for internal use only
• Basic research or technical experiments
• Where the product/process is just another iteration or version of an existing product/process with minor changes

What can the funding be used for?

The funding can be used for:

• Wages (note overseas contractors may be funded, but only for work that is specifically identified as contributing directly to the project)
• Consultation Fees
• Direct Prototyping Materials
• Equipment
• Other Direct costs
  • Patent filing costs for IP
  • Workshop or laboratory usage charge outs
  • Travel Costs

The funding cannot be used for:

• Marketing and promotional expenditure
• Smart devices (laptops, watches, mobile phones and tablets)
• Recurring costs such as software licenses, cloud storage or other online services

Application Steps

• Expression of Interest (EOI): Submit an online EOI form that meets all eligibility criteria (Innovation, Commmercialisation and Deliverability) before the Key Dates.
  • Tips on meeting the eligibility criteria (Innovation, Commercialisatiion and Deliverability)
    • Highlight Innovation: Emphasize how your product or service is revolutionary and differentiates it from other competitors.
    • Showcase Commercial Potential: Provide a detailed market analysis, explain your unique competitive advantage and how/why customers will choose your product.
    • Elaborate on Delivery: Include a thorough plan covering activities, milestones, costs, and risks that will show clear progress through the TRL scale.
• Key Dates:
  • Applications Round 1 open: 4 December 2023 
  • Applications Round 1 close: 4:30pm AEST, 30 April 2024
• Documentation include:

• Medium that demonstrates how your product process meets the Innovation Criteria. The format can be either:
  • Pitch Deck with max 10 slides; or
  • Online video with max 3 mins.
• Evidence of financial turnover (P&L statement and completed accountant declaration)
• Evidence of less than or equal to 20 full time employees (completed accountant declaration)

• Detailed Application: If successful at the EOI stage, proceed with a comprehensive application, including all necessary details and documentation.
• Executing the Funding Agreement: If successful application is made, a Funding Agreement will be issued to you for execution.

Funding Agreement Upload Requirements:

• Upon submitting your signed copy of the Funding Agreement online via SmartyGrants, you must also include:
  • Certified copy of your photo id card; and
  • Certified copy of a recent bank statement (max 30 days old) that includes the company’s legal name, address and bank account number; and
  • If relevant, copy of bank statement (max 30 days old) in the company’s legal name that shows that you have received the co-contribution (if this was conditional on being successful with the grant)

How businesses will receive the funding 

The grant is disbursed in milestone payments:

• Milestone 1: Receive 35% of the total funding upon the execution of the funding agreement.
• Milestone 2: Progress Report to be submitted on online portal (SmartyGrants) 3-6 months after the execution of the funding agreement
• Milestone 3: The remaining 65% is disbursed upon the successful completion of the project and fulfilling the funding agreement’s requirements. Note this cannot be less than 6 months from the date that your funding agreement is executed. Any unspent amount will be forfeited (including those claims that are not sufficiently forfeited).

Biztech Lawyers can help you

The NSW Government’s MVP Ventures Program has made its long awaited return, and your tech business should maximise the opportunity to secure government funding for your big tech idea. Reach out to Biztech Lawyers today if you have any legal concerns about the funding process, or taking your startup to the next level. Engage with us today.