Every scipreneur needs to learn how to manage money, how to get access to it, and how to make the best out of what they have.

Science operates on grants, and when spinning out there's a high chance we will default to try the same approach.

In many places, grants are seen as free money, because they barely ask anything in return. When you get a grant, no equity is diluted, most likely there will be no consequences if you fail to deliver on what you promised. Many young companies rely on grants to get started because they take the burden of negotiating term sheets and giving power to external parties.

Grants are also used to grow companies at later stages. Especially in scipreneurship, developing new products and processes can be very capital-intensive and risky. Grants are meant to address that. In some cases, the purpose of the grant is to incentivize partnerships that wouldn't have happened (between academia and companies, and between companies themselves.)

However, it is very easy to find companies that are addicted to grants to keep operating.

I have even seen companies where half their employees are working on grants, and where there are entire departments focused on just applying for *free money.

The problem with this approach is that you detach yourself from what matters: addressing your customer's problems creatively and efficiently. A grant of one million euros/dollars/pounds is a great boost for a small company, there's plenty you can do. But if once the grant is finished you didn't find a way of transforming that million into a continuous business, you are not better off than when you started.

The first collaborative grant I applied to, gave the company access to a network of researchers that would test our technology. On the other hand, we were promising the development of a custom solution, forcing us to develop new technology that we hoped would become integral to our business case.

We used the grant to take a massive risk in product development, but we knew that if we were successful it would catapult us to the next stages of business development.

Grants are a great instrument for starting and growing scipreneurs, but they won't always be available.

There's a famous expression that says: 1+1>2, and grants can be the + that is missing in the equation. If they are used as catalyzers, then it means you are already planning ahead in the right direction. If after the first grant, you need a second grant, and then a third, you are not creating a sustainable business.

And that's the risk of companies that rely too heavily on grants, they forget about their customers. Perhaps a grant allows them to deliver a product or prototype. But if from the onset there were no plans of finding new customers at a later stage, then what was the purpose?

The beauty of grants is that they can absorb risk. If the project fails, the company will not be auctioned off, nor forced to repay. Being smart at selecting what risk can be better mitigated by applying for a grant is what separates good scipreneurs from the rest.