Let’s say you have a great idea for a product or a service, but you need capital to utilize it, or to transform it into a new company. Where can you look in Cyprus to get the right funds for your ideas?
Not having the amount that is needed to keep going (and growing) a startup, can be a deterrent factor for many, and the whole journey stops there. But there are options for everyone, as long as startups are alert and take advantage of every opportunity for calls for applications. Below we examine some of the major ways that entrepreneurs can seek funding in Cyprus.
Public sector
One of the first options must be the public sector and governmental schemes that take advantage of funds from the European Union and state funds, specifically for startups and companies in the early stages.
The first place to look for is the Research and Innovation Foundation (RIF) with various programs for funding startups. One example is the Pre-Seed programme, which is funded by the National Plan on Cyprus Recovery and Durability “Cyprus of Tomorrow”. In 2023, 134 proposals were submitted through the IRIS portal of RIF, of which 106 were first-time applicants. For comparison, the previous Pre-Seed 2021 funding round, where 90 proposals had been submitted.
Just to give an idea, after RIF assesses the application, startups are entitled to receive funding of up to €119,999 to advance the development of their innovative concepts, products, and services with the potential to access global markets. At the same time, RIF extends support services for innovation and knowledge transfer to beneficiaries, enhancing their prospects for success and laying the groundwork for the establishment of sustainable enterprises.
It is worth mentioning since the start of the Pre-Seed program in 2019, over €3.5 million has been allocated to 35 startups, resulting in the creation of more than 75 new jobs. Notably, one out of every four startups that received funding in the initial phase has augmented their revenues through sales and/or investments from both domestic and international sources.
Another place to look for is the Ministry of Finance’s Information Portal for Funding Programmes. Although it might be chaotic, the portal concentrates on all the programs and schemes that are coming from either EU or national grants. Startups can highly benefit from these funding instruments, but founders should be alert, as announcements of new calls for applications may be missed due to system slowness.
Accelerators and Incubators
Entrepreneurs can of course look for capital in other sectors or platforms. This is where accelerators and incubators come in. These two offer startups various forms of support, including funding, mentorship, networking opportunities, access to resources and facilities, guidance in business development and strategy, assistance in product development, validation of ideas, and help in accessing potential investors and markets. They provide an environment conducive to growth and success for startups.
One well-known platform of this kind is the IDEA Innovation Center. Established in 2015 by the Bank of Cyprus and other esteemed supporters, serves as a hub for startups and entrepreneurs. Today, IDEA is Cyprus’s largest non-profit organization, collaborating with both private and public partners to assist startups and innovative Small and Medium-sized Enterprises (SMEs). It offers top-notch training and services to startup companies, aiming to transform their innovative ideas into successful global businesses. In essence, IDEA equips aspiring entrepreneurs with the necessary tools to gradually develop their ideas into profitable ventures.
Cyprus Seeds, is a non-profit organisation with the mission, as they state “to support the commercialisation of scientific research projects with strong intellectual property (IP) value and global market potential, in all Cypriot universities and research institutions”. The NGO offers an 18-month pre-accelerator program with funding and mentoring, helping startups to enter the markets.
Another accelerator is ARIS, also an NGO in association with Deloitte with the sole purpose of offering start-ups and scale-ups with the structure, mentorship, and network needed to grow successful business ventures.
Angels above
Looking higher, startups that want to grow must have in mind the option of angel investors. In short, an angel investor can offer funding, mentorship, networking opportunities, industry expertise, and strategic guidance to a startup. Cyprus Business Angels Network (CYBAN) is an example of such an option and according to their website, since CYBAN’s foundation in 2013, the members have invested over €4.75M in 11 companies representing several industries ranging from Genetics to Student Services.
Turning to people
Crowdfunding is a method of raising funds from a large number of people, typically through online platforms, to support a project, business, or cause. It helps startups by providing access to capital without relying solely on traditional sources like banks or venture capitalists. Startups can pitch their ideas or products to a wide audience, who can then contribute small amounts of money in exchange for rewards or equity. This not only provides funding but also helps validate the idea and build a community around the startup. One example of a platform that offers crowdfunding for startups and is based in Cyprus, is Crowdbase.
At the end of the day, entrepreneurs must believe in their vision and face every challenge ahead of their road. The options and the opportunities to find some or full capital for their growth are plenty, though with obstacles and a lot of bureaucracy. Stay resilient, stay passionate, and remember, the right investors are out there, eager to support innovative ideas like yours.
Having said all that, there is another way for startups to gain the attention of investors, or at least to get some serious public exposure. It is said that “you have to dream big” and therefore you have to think globally… and locally too. One of the biggest competitions in the world is coming to Cyprus in 2024 – the Startup World Cup. Why this is important you may ask. Because through the completion applicants will have the opportunity to pitch their startup of all stages, technologies, and industries. The winner of the regional cup will get a chance to compete in the San Francisco Grand Finale and win an investment prize from Pegasus Tech Ventures.
