Purpose of the Fund
The Botswana Innovation Fund (BIF) aims to promote innovation through technology, product, and business development in the private sector by providing cash grants to registered entities. It also encourages skill transfer to citizen employees through training programs.
Definition of Innovation
Innovation refers to the development of new and unique products or processes that are functionally advanced, efficient, and cost-effective. It includes significant improvements to existing products or processes, resulting from technical development. Projects considered innovative should:
– Offer unique features or attributes not previously seen in similar products.
– Provide substantial efficiency improvements, particularly in software development.
– Result predominantly from technical advancements rather than research or studies.
General Funding Criteria
The BIF will provide financial support to proposals based on merit. All promising applications will be evaluated considering the following General Criteria:
– The project seeks to develop a new product, process, or technical service that surpasses existing ones in terms of functions, parameters, or features.
– All Intellectual Property (IP) rights shall reside in a Botswana-registered company.
– Products developed must comply with relevant national and international standards.
– Only one application may be considered from any company at a time. Subsequent applications will be considered upon completion, cancellation, or withdrawal of a project.
– The applicant must submit a valid Botswana Unified Revenue Services (BURS) Tax Clearance Certificate at the time of application and for each milestone payment request.
– The sustainable competitiveness or marketability of the product or service in the industry for targeted markets.
– Alignment with BIF industry focus and or call objectives
– Social and Economic impact, including increased taxation revenue, meaningful job creation, increased and value-added exports, increased competitiveness of industrial sectors, increased highly skilled capacity and knowledge base, lowered net intellectual property cost, increased capabilities for technology innovation solutions to national needs, and improvement in quality of life and responsiveness to social and developmental needs.
– The technical and commercial viability of the plan.
– The ability of the team to implement the plan, including the commercial strength of management and the existence of sound management systems.
– Financial viability of the business.
– The business model should be replicable or scalable.
Approval of applications is always subject to the availability of funding.
What Do We Fund?
1. Salary and Labour Costs
– Basis: Qualifying remuneration is based on the total annual salary package of each individual. This would normally be the amount contained in the person’s letter of appointment. Qualifying costs will also be determined for the project team based on the approved rate and hours approved for the project supported by relevant payslips and other documentation.
– Overtime: Overtime will only qualify if this is specifically paid, and the maximum hourly rate will be the salary rate. No double or improved time will be allowed.
– Management Costs: Only the costs of executive or managerial personnel, including directors, who are directly involved in the project qualify, and only to the extent that such personnel are contributing technical inputs.
– Non-Eligible Costs: General management costs, production administration, support personnel commissions, interest, allocated costs of overheads and services (e.g., rent, electricity, telephone), statutory costs, and consultant fees. Costs not substantiated with time sheets, any non-guaranteed payments such as profit or performance bonuses, and share options.
2. Material Costs
– Eligible: Direct materials for prototype or model: qualifying material costs comprise material of a non-capital nature consumed during the direct development and manufacture of prototypes and models for full commercialisation.
– Non-Eligible: Non-capital material costs not directly related to the project.
3. Subcontractor Costs
– Eligible: Where the subcontracted items are eligible for support (i.e., the costs would be regarded as qualifying costs if the subcontracted work was carried out by the applicant) and the subcontractor is at “arm’s length”, the subcontracting costs are regarded as qualifying costs. It is further required that the Intellectual Property (IP) developed as a result of the project is wholly owned by the recipient.
– Non-Eligible: In instances where it is considered that a subcontractor is not at “arm’s length”, expenditure by the subcontractor is to be treated as if incurred by the applicant and must be subject to the same rules as applied to the applicant.
4. Tooling and Capital Equipment
– Tooling Costs: General: The costs of design, compiling mechanical drawings, building models and prototypes of tooling up to the stage of the completion of the project are qualifying costs.
– Tooling Costs: Specially Approved Items: Tooling that is purchased or the manufacture of which is subcontracted and that can be used for both development and commercialisation may be considered as a special approved item.
– Capital Equipment: Specially Approved Items: Capital items that are required specifically for the development project are qualifying costs.
Non-Eligible: General capital equipment not directly related to the development project.
5. Computer Hardware and Software Costs
– Eligible: Software (e.g., process software) will be approved as a qualifying cost on a case-by-case basis if it forms an integral and inseparable part of and is essential for the functioning of the prototype and eventual product. Where qualifying, the maximum number of computer hardware (including laptops) that can be funded is two (2). Computer hardware and software costs used in the development process will qualify.
– Non-Eligible: In general, any costs related to computer hardware or software are non-qualifying costs unless specified otherwise.
6. Intellectual Property and Licensing Costs
– Eligible: Costs incurred in respect of the lodging of patent applications are regarded as qualifying costs. The type of patent registering authority and the applicable country or countries must be specified. Patent costs are treated as a specially approved item. The patent must be registered in the company’s name. Costs for licenses or royalties for technology (excluding software) that is required in the development phase of a project will be considered on merit as qualifying costs.
– Non-Eligible: Costs for defending patents.
7. Travel Costs
– Eligible: Qualifying travel costs are restricted to those required for development purposes and are limited to economy-class airfares for one person per trip. That person must be an employee of the company who is directly involved with the technical development. Cost for car hire, travel by buses and taxis are also qualifying.
– Non-Eligible: Travel costs that are not related to the development of the product or process are non-qualifying. Travel costs to attend seminars, conferences, training courses, and workshops are non-qualifying costs unless approved as special qualifying. Costs for laundry and tips are non-qualifying costs.
8. Documentation and Certification Costs
– Eligible: The cost of the preparation or compilation of development-related operating user maintenance and specification manuals are qualifying costs. The costs of product quality or other certification (e.g., BOBS) are qualifying and specially approved items.
– Non-Eligible: Non-development related documentation and certification costs.
9. Proof of Market/Pre-Commercialization
– Eligible: During the last milestone, the applicant must include the proof of market and/or pre-commercialization as one of the deliverables. The cost for undertaking the proof of market is qualifying.
Exclusions
The BIF reserves the right not to consider applications:
– That are incomplete
– Where inadequate effort has been made to secure other funding for the application.
– Which seek to expand any of the following markets: tobacco, liquor, recreational drugs, sex trade.
Products and processes developed for a single client will qualify for BIF support subject to the contractual conditions of the single client.
– A project that receives other government grant funding will not receive support from the BIF (double-dipping – obtaining funds for the same project service or a product from different sources).
– Projects of a military nature will not receive BIF support unless the product or process being developed will have a substantial general commercial or civilian application.
– Projects where technology is licensed from a third party and the license agreement restricts the commercial application will not qualify for BIF support.
– BIF support will be for pre-competitive development (including Pre-Commercialization) excluding research of new products or processes.
This structure retains the detailed criteria and exclusions from the original document while organizing the costs under relevant subheadings.