Funding for the innovative manufacturer

Matt Symonds, Managing Director of TBAT Innovation, reveals how smaller manufacturers can bring creative technologies to market while keeping core business afloat.

In her interview with The Manufacturer (Dec 2015), Dr Ruth McKernan, CEO of Innovate UK reminds us that the greatest productivity and economic growth will come from the UK’s fast-growing, medium-sized businesses.

Ruth McKernan CBE, new Chief Executive of Innovate UK
Ruth McKernan CBE, chief executive, Innovate UK.

But to get to that stage, we still need to spot the more innovative and ambitious smaller companies, and support them to bring their new products to market. Major issues such as investment in research and development, while maintaining the core business, mean that firms still need plenty of external support.

One such company is East Midlands-based Lindhurst Engineering, whose diversification from servicing the coal mining industry to low-carbon waste management, has provided it with an opportunity for both survival and growth.

In particular, the company’s application of government grants, university collaborations and latterly European Horizon 2020 project funding, makes it the kind of venture McKernan is looking for.

From coal to waste disposal

Founded in 1985 in the heart of the North-Nottinghamshire coalfield, Lindhurst managed to find new outlets for its fabrication and electrical engineering expertise including the manufacture of concrete railway sleepers and the design and build of a mobile art installation for Liverpool.

Lindhurst was founded in 1985 in the heart of the north Nottinghamshire coalfield.
Lindhurst was founded in 1985 in the heart of the north Nottinghamshire coalfield.

By 2009, company owner Martin Rigley was on the lookout for a product of his own when he read about the problems associated with farm waste disposal. So, the efficient treatment of waste at the source of waste production became Lindhurst’s new vision.

Early research into anaerobic digestion, helped by two successful bids for Technology Strategy Board (now Innovate UK) grants, meant that Rigley and his team could test the feasibility of a small-scale anaerobic digestion plant.

Taking the idea further meant collaborating with the University of Nottingham through a Knowledge Transfer Partnership to build a larger unit to prove it could tackle cow and milk waste.

The result is an anaerobic digestion (AD) system built around the architecture of a microbial fuel cell, which not only handles dairy waste but is designed to use the by-product, bio methane, as well as, the digestate.

It took five years to get to the point where Lindhurst wanted to prove the AD technology in sectors other than dairy. To do this, it worked with TBAT Innovation to secure European Union Horizon 2020 funding under the SME Instrument.

The firm’s venture has already secured four jobs and created two new posts, with the possibility of a further two positions as it moves into the deployment stage.
The firm’s venture has already secured four jobs and created two new posts, with the possibility of a further two positions as it moves into the deployment stage.

This was awarded in November 2015 and will finance the production of five new demonstrator units using feedstocks such as brewery waste, ice cream, onions and potatoes.

Working with European partners in Denmark, Spain, Southern Ireland and the UK, the project runs to November 2017.

How Horizon 2020 works for companies like Lindhurst

The SME Instrument is designed for a single SME business such as Lindhurst, or an SME lead in a collaboration, with a product, process or system ready for demonstration and market exploitation (Technology Readiness Level 6 or above).

They can apply for significant levels of project funding up to £1.8m, and although competition is extremely high, a successful bid is a strong indication that the innovation will fly and be of interest to investors.

Lindhurst fitted the criteria well; its research and development has been proven to work and the commercial potential for the disposal of organic matter is huge.

What makes a good Horizon 2020 application?

Assuming a project addresses one of the funding topics, the application must then explain the innovation and how it meets new needs.

The anaerobic digestion system handles dairy waste and is designed to use the by-product, bio methane, as well as, the digestate.
The anaerobic digestion system handles dairy waste and is designed to use the by-product, bio methane, as well as the digestate.

Evidence of technical risk and global commercial opportunity need to be laid out alongside a realistic assessment that the company can deliver the project.

Lindhurst was able to quantify future business growth and continued commitment to future research and associated investment, so its bid had a strong chance of success.

Part of the TBAT Innovation service is to make sure that the project fits the scope of the Horizon 2020 application, and ensure that all project, market and commercialisation information is communicated clearly within the application documents.

Lessons learnt

Rigley appreciates that applying for such high levels of European funding can be complex and time consuming; even when successful, the due diligence process can be daunting.

However, without such funding, work on the new technology would have ceased, so he advises not to give up.

Working with TBAT to access a number of previous grants meant this successful H2020 application felt like a real team approach.

The Lindhurst venture into organic waste disposal has already secured four jobs and created two new posts, with the possibility of a further two positions as it moves into the deployment stage.

The attraction of Horizon 2020 funding is its capacity to ensure a project is completed in full and as quickly as possible. Being first to market helps drive revenue and future growth; something McKernan is keen to see.

It also encourages partnership-working, access to new expertise and as Lindhurst can demonstrate, the creation of new jobs.