Incubators (business support organisations) for inclusive and social entrepreneurship

Deadline: May 25, 2020  
CALL EXPIRED

1. INTRODUCTION – BACKGROUND

1.1. Programme/Legal base

This call for proposals is published under Regulation (EU) No 1296/2013 of the European Parliament and of the Council of 11 December 2013 on a European Union Programme for Employment and Social Innovation ("EaSI")1 and amending Decision No 283/2010/EU establishing a European Progress Microfinance Facility for employment and social inclusion.

The 2020 annual work programme C(2019)7630 was adopted by the Commission on 30 October 2019.

This call for proposals is financed under the European Programme for Employment and Social Innovation "EaSI" 2014-20202 which is a European-level financing instrument managed directly by the European Commission to contribute to the implementation of the Europe 2020 strategy, by providing financial support for the Union's objectives in terms of promoting a high level of quality and sustainable employment, guaranteeing adequate and decent social protection, combating social exclusion and poverty and improving working conditions.

1.2. Policy and economic background

Supporting entrepreneurship and self-employment

Entrepreneurship and self-employment help to create jobs, develop skills and give unemployed and vulnerable people an opportunity to fully participate in society and the economy. They therefore make an important contribution to “an economy that works for people” indicated in the Political Guidelines of the President of the Commission. This includes a dedicated SME strategy which should help SMEs thrive by reducing red tape and improving their access to the market ̧ making it easier for small businesses to become large innovators. In addition, social entrepreneurship also contributes to the actions announced in the European Green Deal, in particular in relation to EU’s Industrial strategy for a clean and circular economy.

Some entrepreneurship support policies are likely to have positive effects on the creation of quality jobs. One of these is the support to under-represented and vulnerable groups to become self-employed, as an alternative to salaried employment (so-called “inclusive enterpreneurship policies”). These groups are women, migrants3, youth, seniors, the unemployed and disabled people (the first three groups are a focus of this support).

Another such policy is support to businesses which combine characteristics of traditional non-profit sector and private business. While these produce and sell services and products, their ultimate goal is not to maximise profit, but rather to contribute to social and environmental goals with a strong return to the community.

 

 

3 Defined as third-country nationals legally residing in the EU. 

These so-called “social enterprises” both create jobs and deliver common goods (care, local development, sustainable development, education and skills, civic participation etc.). Often they mobilise some atypical resources, such as voluntary work and therefore can operate in a low-profit environment, not attractive to mainstream business. Social entrepreneurship can also help to make entrepreneurship more attractive in general and amongst some of the target groups of inclusive entrepreneurship policy. Thereby the two concepts are interlinked.

EU support to these forms of entrepreneurship consists of knowledge-building, capacity- building and financial support.

Link to the European Pillar for Social Rights

The European Pillar of Social Rights is the policy compass that points the way how to address the challenge of upward convergence and promoting a fair Europe. It provides a rights-based response to the future of work. EU institutions, all levels of government, social partners and civil society share the responsibility to put the Pillar into practice. The Council Strategic Agenda 2019-2024 states that the European Pillar of Social Rights should be implemented at EU and Member State level, with due regard for respective competences. The President’s Political Guidelines announced an action plan to fully implement the European Pillar of Social Rights.

Inclusive and social entrepreneurship can contribute to the implementation of the European Pillar for Social Rights, in particular fostering equal opportunities for under-represented groups (principle #3), active support to employment, including self-employment (principle #4) and secure and adaptable employment (principle #5), inclusion of people with disabilities (principle #17) and long term care (principle #18).

1.3. Main Purposes

EU financial support to micro-enterprises and social enterprises

The main objectives of the Microfinance and Social Entrepreneurship axis of EaSI (the so- called third axis) are:

 to increase access to, and the availability of, microfinance for vulnerable groups who want to set up or develop their business and micro-enterprises; and

 to support the development of social enterprises, in particular by facilitating access to finance.

The support offered under EaSI includes a Guarantee scheme, a Capacity Building instrument, grants aimed at building the finance markets for social enterprises and advisory services4. This is complemented by a set of pilot social impact equity instruments launched under the European Fund for Strategic Investment (EFSI), including a facility for financial intermediaries linked to incubators, accelerators, and/or that provide incubation services for social enterprises in their early stages and a Business Angel Facility5.

 

The EU support enables selected microcredit providers and social enterprise investors in the EaSI participating countries to build their capacities and to increase lending to microenterprises and social enterprises, as well as to make small risk-capital investments into social enterprises.

Experience so far shows that EU support aimed at making more finance available for microenterprises and social enterprises is needed, but not sufficient. Financial intermediaries often report difficulties in finding a pipeline of investees. At the same time, potential investees lack the capacity to access and manage repayable finance.

Supplementing financial support with non-financial support

The EU supply of finance to social enterprises and entrepreneurs from vulnerable backgrounds is only one source of finance for those entrepreneurs. Whatever source of finance (even internal), entrepreneurs need business development support, as well as “investment readiness” support which prepares them to access and manage repayable finance.

Specialised business development support is important to help entrepreneurs acquire the skills and knowledge they need to develop sustainable business models and to manage companies successfully. Specifically support is needed to help businesses run by people from vulnerable groups6 (and social enterprises) grow. They need support in dealing with challenges specific to their backgrounds and business models (e.g. social enterprises have to be able to measure, manage and report on their impact).

Evidence suggests that business incubators can be effective supports for new and growing businesses. Businesses that receive support in incubators tend to have higher survival rates, create more jobs, and generate more revenue. While there are relatively few examples of business incubators that are fully dedicated to supporting entrepreneurs from under- represented groups, there is a small body of evidence that shows similarly positive results. This suggests that there is a likely untapped potential for business incubators to be used more widely for inclusive and social entrepreneurship, see OECD/EU (2019)7. Broadening the scope of business incubators to social and inclusive entrepreneurship incubators can make entrepreneurship more attractive for people from vulnerable groups and people who want to run a business with a social aim.

Mobilising mainstream incubators (business support organisations) to address social and inclusive entrepreneurship

While some countries and regions choose to put in place support measures and structures specific to target groups8, another option is to tap into the potential of mainstream incubators.

 

Working with mainstream incubators could have several advantages. One is that their outreach is larger than that of dedicated incubators, and they could potentially have a larger impact in that respect.

Another advantage is cost efficiency: part of the overhead cost of the actions can be spread over different target groups (scale effect). Finally, given the growing attention paid by mainstream entrepreneurs and investors to social, environmental and governance aspects of their activities, mainstream incubators also stand to benefit from becoming aware of the specific challenges faced by entrepreneurs from vulnerable backgrounds and by social entrepreneurs and of best ways to support them. There is also untapped potential in developing collaborations between mainstream and inclusive/social businesses.

 

2. OBJECTIVE(S) – PRIORITIES – TYPES OF ACTIONS - EXPECTED RESULTS

2.1. Objectives – Priorities - Definitions

Inclusive and social entrepreneurship policies boost social innovation, help to create jobs, develop skills and give unemployed and vulnerable people an opportunity to fully participate in society and the economy.

The barriers to start and develop a business are higher than average for those run by underrepresented groups and social enterprises. Non-financial support by incubators can help to make the financial support given to business creation and development by underrepresented groups and social enterprises more effective. Notably, the non-financial support (consisting of training, workshops, coaching and mentoring, business advice and networking opportunities) which incubators provide is conducive to a better use of financial support, increasing the survival chances of businesses run by underrepresented groups and social enterprises.

For this reason, this call aims at mobilising existing network(s) of mainstream business incubators to expand their outreach to inclusive and social entrepreneurship. To achieve this, the supported action shall draw from the experience of support organisations and networks already targeting social entrepreneurs and (potential) entrepreneurs from under- represented groups. Optimally, this will be combined with support for scaling and replication of social enterprise and social innovation business ideas through dissemination of knowledge and understanding of potential market opportunities in other territories. This type of knowledge transfer can be ensured by involving pertinent partners as co-applicants and/or by qualified experts directly involved in the project implementation.

The supported action needs to cover a large part of the EU Member States / EaSI participating countries including regions and cities outside of the capital area of countries. The aim is also to achieve a geographically balanced coverage of countries (North, South, East, West of Europe).

is typically more tailored to address the specific challenges faced by the target group and support is delivered through mechanisms that have been adjusted to the context of the target group. However, this approach also has the risk that incubation services provided to a segregated group may reinforce the exclusion from the mainstream business community that these individuals and businesses already face (OECD/EU (2019), ibid.).

 

For the purpose of this call,
 “Business incubators” mean support organisations of which the main purpose is to

promote business creation and entrepreneurship by offering relevant services such as training, workshops, business coaching and mentoring, business advice, networking opportunities and financing for potential start-up companies and micro entrepreneurs. These bodies can support the start-up as well as the scale-up of businesses.

 “Network of business incubators” means an established network, which among its members includes organisations fulfilling the above definition of business incubator. Consequently the call is open also to networks which include multiple types of member organisations.

 “Social entrepreneurship/social enterprises” mean businesses, of which the primary objective is to achieve positive social impact. Consequently they are subject to profit distribution limits and participatory governance principles.9

 “Inclusive entrepreneurship” is an approach to ensure that all people, regardless of their background, have an equal opportunity to start and run their own businesses. It focusses on target groups that are under-represented in entrepreneurship, or that face greater barriers to business creation and self-employment, e.g. women, migrants, youth and the unemployed.

Through the supported action, the members of the network(s) shall gain knowledge about:

 the concepts of inclusive and social entrepreneurship and about the added value of adequately integrating these concepts in their work;

 the key challenges specific to the underrepresented target groups and social entrepreneurs (amongst others, specific barriers, communication);

 the methodologies needed to work effectively with these target groups (amongst others, target group specific working methods, communication methods, social impact measurement, knowledge of available mutual support networks and specific funding schemes);

 about European and international programmes, networks, organisations, and platforms in these fields.

As a whole, the supported project shall cover both inclusive and social entrepreneurship in a balanced way. However some activities can be specific to one of the two concepts or even specific to one of the target groups. Initiatives by public authorities (European, national, local/regional) shall be taken appropriately into account, looking after synergies and overall reinforcement of inclusive and social entrepreneurship efforts.

2.2. Description of the activities to be funded / Type of actions

Proposals must be centred around activities promoting the concepts “inclusive and social entrepreneurship” amongst all individual member organisations of the network or the consortium of networks. Activities shall notably focus on transferring knowledge and building capacities amongst the member organisations, so that they will be well equipped to work with the (potential) entrepreneurs in these fields (see specific challenges and working methods in 2.1).

The types of activities which may be funded under this call for proposals can include: - gathering, production and diffusion of relevant information materials;
- study visits and exchange of good practices;
- training activities, webinars, seminars, conferences, etc;

- developing business support services for inclusive and social entrepreneurs, including toolkits, templates, manuals and other support material;

- actions aiming at creating and improving connections to stakeholders in inclusive and social entrepreneurship;

- awareness and dissemination actions amongst the network’s members and towards the wider audience.

This list is not exhaustive and applicants are encouraged to use new, innovative and experimental ways of achieving the objectives. Applications shall detail the resources foreseen for each of the activities proposed as well as the professional qualifications and relevant experience of the teams that will conduct those activities.

All activities shall be presented under the umbrella of a comprehensive work plan, which should detail their links with the objectives, their expected results, the budget breakdown and the milestones for achieving the results in the implementing period.

2.3. Expected outputs/results

The funded action is expected to mobilise as many individual member incubators of the network(s) as possible to integrate inclusive and social entrepreneurship systematically in their service offer and consequently to better address the relevant target groups (including social entrepreneurs) in their own territory.

In addition to this direct mobilisation of member incubators, the action is expected to have a lasting spill-over effect in terms of wider attention paid to the issues of inclusive and social entrepreneurship in the countries directly involved and possibly beyond these countries.

Applications shall provide quantitative targets to be achieved for the different activities proposed.

2.4. Monitoring

The Commission, with the support of an external contractor, will monitor regularly the EaSI Programme. Therefore, beneficiaries will have to transmit qualitative and quantitative monitoring data on the results of the activities. These will include the extent to which the principles of equality between women and men has been applied, as well as how anti- discrimination considerations, including accessibility issues, have been addressed through the activities. Related templates are attached or will be provided.

As part of the application documents, the applicants are requested to submit a “Key Issues paper”, of maximum 3 pages, in which they explain to the members of the involved network(s) the value added of embracing inclusive and social entrepreneurship, possibly including a visual illustration (see checklist, point 19). The Key Issues paper will be taken into consideration when the applications are assessed against the award criteria.

 

 

The Commission will monitor the action for the EaSI programme through the information provided in the specific Annex to the Grant Agreement. The reporting template is published on the respective EaSI call page https://ec.europa.eu/social/main.jsp?catId=629&langId=en

In setting up the action, beneficiaries must foresee the necessary funding for monitoring and reporting to the Commission. For events, it is important to get from participants their specific consent by a statement or by a clear affirmative action for processing and transferring their personal data also to an external contractor responsible for the monitoring of the EaSI programme. Beneficiaries should therefore inform all participants via a Privacy Statement that is not only published online, but is also provided individually to each participant (e.g. as part of the email where the beneficiary/contractor first contacts the individual concerned) that the Commission/external contractor would be processing their personal data. Beneficiaries have to be able to demonstrate that consent was obtained subject to conditions of Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data (i.e. keep a record that shows how the consent was obtained and whether it was valid) and Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data.

A model privacy statement is available on the Europa website of the EaSI programme: https://ec.europa.eu/social/main.jsp?catId=1081&langId=en&furtherCalls=yes&callType=2.

2.5 General requirements for the activities to be funded under EaSI

The EaSI Programme shall, in all its axes and actions, aim to:

(a) pay particular attention to vulnerable groups, such as young people;

(b) promote equality between women and men,

(c) combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation;

(d) promote a high-level of quality and sustainable employment, guarantee adequate and decent social protection, combat long-term unemployment and fight against poverty and social exclusion.

Hence, in designing, implementing and reporting on the activity, beneficiaries must address the issues noted above and will be required to provide detail, in the final activity report on the steps and achievements made towards addressing those aims.

 

3. TIMETABLE

 

a) Publication of the call

02/2020

b) Deadline for questions and requests for clarification

20/04/2020

c) Deadline for submitting applications

30/04/2020

Swim, Courier and Post : 24:00 Brussels' time (CET)

Hand deliveries 16:00 Brussels' time (CET)

d) Evaluation period (indicative)

05-06/2020

e) Information to applicants (indicative)

07/2020

f) Signature of the grant agreements (indicative)

09/2020

g) Starting date of the action (indicative)

09/2020

3.1. Starting date and duration of the projects

The actual starting date of the action will either be the first day following the date when the last of the two parties signs the grant agreement, the first day of the month following the date when the last of the two parties signs or a date agreed upon between the parties.

Applicants should note that if their project is selected, they may receive the grant agreement after the start date of the action that they have indicatively set in the application form. It is therefore advisable to number the months in the work programme instead of indicating the actual month or the exact date.

No expenditure can be incurred before the date of submission of the application. Any expenditure incurred before the signature of the Grant Agreement will be at the applicant’s risk.

The indicative duration of the project should be 24 months.

 

4. AVAILABLE BUDGET AND CO-FINANCING RATE

4.1. Available Budget

The total budget earmarked for the EU co-financing of projects under this call is estimated at 1 300 000 EUR.

The EU grant requested should indicatively be between EUR 1 000 000 and EUR 1 300 000.

The Commission expects to fund 1 proposal.

The Commission reserves the right not to distribute all the funds available.

The Commission reserves the right to increase the amount of the funds in case of available funds and distribute them to proposals admitted in the reserve list, if any. This top-up of the budget is limited to 20% of the initial budget of the call.

4.2. Co-financing rate

Under this call for proposals, the EU grant may not exceed 80% of the total eligible costs of the action. The applicants must guarantee their co-financing of the remaining amount covered by the applicants' own resources or from sources other than the European Union budget10.

 

5. ADMISSIBILITY REQUIREMENTS

•   Applications must be sent no later than the deadline for submission referred to in section 3(c).

•   Applications (meaning, the application form, including budget, description of the action, work plan plus a series of other required documents, see section 16.2) must be submitted using the electronic submission system available at https://webgate.ec.europa.eu/swim, and by sending a signed, printed version of the complete application form (including all documents specified in the check-list) by post or courier service (one original dossier and one copy; see section 16).

Failure to comply with one of the above requirements may lead to the rejection of the application.

Applicants are encouraged to submit their project proposal in English in order to facilitate the treatment of the proposals and speed up the evaluation process. It should be noted, however, that proposals submitted in any of the official languages of the EU will be accepted. In this case, applications should be accompanied by an executive summary in English (see checklist, point 3).

 

 

6. ELIGIBILITY CRITERIA

6.1. Eligibility of the applicants (lead and co-applicants) and affiliated entities11

For British Applicants: please be aware that following the entry into force of the EU-UK Withdrawal Agreement12 on 1 February 2020 and in particular Articles 127(6), 137 and 138, the references to natural or legal persons residing or established in a Member State of the European Union are to be understood as including natural or legal persons residing or established in the United Kingdom. UK residents and entities are therefore eligible to participate under this call.

a) Place of establishment

Legal entities properly established and registered in the following countries are eligible as single, lead applicant, co-applicants:

•   EU Member States;

•   Iceland and Norway in accordance with the EEA Agreement;

•   Albania, North Macedonia, Montenegro, Serbia and Turkey13.

b) Type of entities
To be eligible, the single, lead applicant, co-applicant and affiliated entity must be:

•   a public or private entities of any type;

•   legally established in one of the EaSI participating countries.

•   an established formal network of business incubators with its own legal personality or representing (as a joint secretariat or officially appointed coordinator) an established formal network. A consortium of several established networks is eligible14.

To be eligible, the single applicant must:

•  have members established in at least 14 EU Member States and in at least one non- EU EaSI participating country.

If a single applicant is considered not eligible, the application will be rejected.

 

To be eligible, the consortium (lead applicant and co-applicants jointly) must:

 be established in at least 14 EU Member States and in at least one non-EU EaSI participating country. The lead applicant and each co-applicant must meet the above three criteria on entities (6.1.b) individually.

c) Consortia15
Actions may involve consortia.

For consortia:
If the lead applicant is considered not eligible, the application will be rejected.
If a co-applicant is considered not eligible, this organisation will be removed from the consortium and their costs/activities will be removed from the budget/project. The eligibility of the modified consortium will then be re-evaluated without them. If the application is accepted for funding, the work plan and budget will have to be adapted as appropriate.

d) Affiliated entities

Legal entities having a legal or capital link with applicants, which is neither limited to the action nor established for the sole purpose of its implementation and which satisfy the eligibility criteria, may take part in the action as affiliated entities, and may declare eligible costs.

For that purpose, applicants shall identify such affiliated entities in the application form.

Sole applicant

Where several entities satisfy the criteria for applying for a grant and together form one legally constituted entity, that entity may be treated by the authorising officer responsible as sole (single) applicant, provided that the application identifies the entities involved in the proposed action or work programme as affiliated entities of the applicant.
For that purpose, applicants shall identify such affiliated entities in the application form.

 

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