by Griffiths + Associates Ltd
31st October 2023
It is customary for an aspiring entrepreneur in Malta to think about external finance, particularly EU funding. Griffiths + Associates as a corporate service provider receives significant client requests relating to this matter. This was one of the reasons why we decided to present a series of clarifying articles devoted to startups and EU requirements.
A very common misunderstanding is to identify any new registered firm as a startup.
So, let's run through the startup definition, within the context of EU funding.
The European Commission, which is the executive branch of the European Union, has defined a "startup" as part of its broader efforts to support entrepreneurship and innovation. According to the European Commission's definition, a startup is typically characterized by the following key elements:
- Age of the Company: Startups are usually young companies, typically in their first five years of existence. They are often in the early stages of their development.
- Financial Independence: Startups should be financially independent, which means they are not subsidiaries of larger corporations or part of established business groups.
- Limited Revenue: Many EU funding programs for startups have restrictions on annual revenue. Startups are typically expected to have limited revenue, often below a certain threshold, as they are in their early stages.
- Innovative Nature: Startups are expected to focus on innovative products, services, or business models. They are often involved in activities related to technology, digital innovation, and disruptive solutions.
- Technology and Knowledge-Based: Some EU funding programs specifically target technology-driven startups or those based on knowledge-intensive sectors, such as information technology, biotechnology, or clean energy.
- High Growth Potential: Startups should demonstrate a high growth potential, indicating their ability to scale their operations, expand into new markets, and create jobs.
So, in short, "Startup" can be defined as a newly established independent company or business venture that is typically characterized by its youth, innovation, high growth potential, a small entrepreneurial team, and a focus on disruptive or technology-driven solutions.
Hence it is relevant to look at this definition but at the same
time there might be other possibilities for assistance if your
business does not meet the above characteristics and the new
registered firm cannot be identified as a startup. An enterprise
just the same time the firm may fall into the category of
"small & medium-sized businesses" (SMEs). Hence, you
may still consider alternative government financial support. In the
following publications, we will delve in more detail on
schemes.
Visit our website griffithsassoc.com and find more information:
Horizon Programs For The Startups In Malta
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.