Hardware startups are expensive, high-risk, and capital-hungry. But there’s a secret weapon many founders overlook: public funding and grants. These programs don’t just provide cash they can give you runway, credibility, and breathing room to build better products without giving up equity too early. For hardware startups, which often need expensive prototyping, testing, and manufacturing, this can be a game-changer.
Why Hardware Startups Should Care About Public Funding
Unlike software startups, hardware companies face big upfront costs:
- R&D for cutting-edge tech
- Building prototypes and test models
- Certifications, compliance, and safety approvals
- Pilot manufacturing and scaling production
That means raising venture capital early can be tough, and every dollar counts. Public grants can fill those gaps without taking a slice of your company. They’re essentially strategic fuel for your growth.
Types of Public Funding That Can Help
Not all funding is created equal. Here are the main categories that hardware founders should know:
1. Research & Innovation Grants
Perfect for early-stage tech validation, feasibility studies, and proof-of-concept work. Think robotics, IoT, or energy hardware projects.
2. Product Development & Prototyping
Once you’ve got an idea, you need a working prototype. These grants help cover materials, lab time, and testing costs.
3. Commercialization & Scale-Up
Funding for getting from prototype to market covering pilot production, tooling, and supply chain setup.
4. Tax Credits & Incentives
R&D tax credits and innovation incentives can reduce your operational costs, effectively stretching your runway.
Key Programs in Europe
European Union-Level Programs
Horizon Europe
Supports projects from R&D through to commercialization. Ideal for deep tech or high-risk hardware.
Website: https://research-and-innovation.ec.europa.eu
EIC Accelerator
Focuses on high-impact innovations, offering grants and optional equity. Great for ambitious hardware startups.
Website: https://eic.ec.europa.eu
National Programs
- Bpifrance (France) – Funding and loans for tech innovation: https://www.bpifrance.com
- Innovate UK (UK) – Grants for R&D, prototyping, and scale-up: https://www.ukri.org
- ANI (Portugal) – Supports innovation and R&D projects: https://www.ani.pt
- Vinnova (Sweden) – Innovation grants for industrial projects: https://www.vinnova.se
Platforms to Discover Grants
- F6S – EU grant database
- EU Startups – News and funding resources
Tips for Applying Successfully
Tell a Clear Story
Grant evaluators want to know why your product matters and why it’s technically feasible. Explain:
- The problem you’re solving
- Why current solutions fail
- How your hardware is different
Align With Policy Goals
Public funding programs often target projects that serve public interests. Highlight if your startup:
- Contributes to climate transition
- Improves healthcare or medical devices
- Supports industrial resilience
- Advances manufacturing or energy tech
Be Realistic
Overambitious timelines or budgets are a common reason for rejection. Show evaluators that you:
- Can hit milestones
- Understand costs
- Are aware of manufacturing and regulatory challenges
Avoid These Common Mistakes
Many founders miss out on grants because they:
- Apply too late in their development cycle
- Treat funding as “free money” instead of strategic capital
- Underestimate reporting and compliance requirements
- Don’t integrate grant objectives into their roadmap
Why Investors Actually Like Grants
Public funding doesn’t scare investors, it often makes them more confident. Grants:
- De-risk your technical development
- Validate your technology with independent review
- Extend runway, so you can hit better milestones before raising equity
Final Thoughts
Public funding isn’t a shortcut it’s a strategic tool. Hardware startups that use grants effectively gain:
- Time to build better, more tested products
- Stronger credibility with investors and partners
- Reduced dependence on early-stage venture capital
In hardware, knowing how to fund the build can be just as important as knowing how to build it.