The Innovator's Guide to IRAP
What is IRAP?
The mission of the National Research Council Industrial Research Assistance Program (NRC-IRAP or IRAP) is to create wealth in Canada by helping entrepreneurs like yourself to create a business based on novel, innovative, cutting-edge technology. If you create or commercialize some new tech and build a massively profitable business in Canada that employs a lot of people, that’s not just good for you, it’s good for Canada. So, the federal government is offering financial assistance, expertise and connections to help you succeed.
IRAP works by funding the employee salaries and contractors required to create your new product or service. Funding is project-based, rather than funding your company’s general operations. A project might involve the commercialization of a new scientific discovery or the development of a new product for an existing business, but your project should have clear objectives, metrics for success and a finite timeline.
The Short Version
By contributing expertise and funding for employee salaries as well as contractor fees, IRAP supports small to medium-sized companies in Canada that are creating new technologies.
Tech companies and innovators of all kinds love IRAP because there are no loans to pay back, and no investors owning a part of your company.
Talk to an IRAP advisor before you apply. They are experienced industry pros who can help you get your project funded.
Be timely and accurate with your information at all stages of the process.
IRAP Project Types
- In 2018, the NRC-IRAP began funding larger R&D projects “that are novel, carry technical risks, have some degree of market validation, and provide benefits to Canada”
- The IRAP model is for “cost-shared” research and development, with up to 80% of base salaries funded for company employees and up to 50% of contractor fees covered by the program. Funded companies must commit to covering the remaining 20% of salaries and 50% of contractor fees.
- Projects can be funded up to $10 million
IRAP ARP (Accelerated Review Project)
- The IRAP ARP process is targeted toward R&D projects for market assessment, technology validation or core technology development projects that are smaller in scope including feasibility and prototype development.
- Up to 80% of base salaries, and up to 50% of contractor fees are funded
- Projects can be funded up to $50,000
- IRAP YEP incentivizes small and medium-sized businesses to hire recent post-secondary graduates in “science, engineering, technology, business and liberal arts to work in a position relevant to the field of their degree for at least 6-12 months”.
- Companies can receive grants of up to $30,000 create a 12-month work placement for first-time YEP participants between the ages of 15 and 30
- NRC-IRAP partners with Global Affairs Canada and national organizations around the world to support small and medium-sized businesses R&D partnerships.
The IRAP Process
As you might expect, the Government of Canada doesn’t just hand out money, but the NRC has been operating this program for more than 70 years, so the program criteria and process are well-established and efficient.
Step 1: Is Your Company Eligible For IRAP?
The IRAP mission is to “accelerate the growth of small and medium-sized businesses by providing them with a comprehensive suite of innovation services and funding,” so the eligibility criteria matches up to that goal. Your company must:
Step 2: Talk to an advisor
IRAP has more than 250 field staff and 130 offices across Canada who provide customized support for companies by tailoring services to local industries and connecting you to local sources of funding, expertise and partner organizations. IRAP Industrial Technology Advisors (ITAs) typically have well over a decade of industry experience in private sector companies, and most of them have a background in engineering or science. ITAs can provide invaluable technical and business advice, but most importantly, they can help you define your project and create your proposal so that your application for IRAP funding is successful.
To make sure you have a productive conversation with an ITA, you should be able to speak with clarity and specificity on a few topics:
- An overview of your current business
- The skills and expertise of the people at your company who will be responsible for making the project a success
- A description of the technology project you want to pursue, including why it’s novel, the market opportunity, metrics for success and timelines for project completion
- Your current budget, sources of funding and cash flow you’ll need to cover your part of the salaries and contractor fees, as well as continuing to cover all other expenses for your business
- Risks and mitigation strategies in case everything doesn’t go according to plan
- The revenue and jobs that will be created in Canada
Step 3: IRAP Proposal, Review, Clarifications
Your ITA is there to help your project succeed, so they will help you understand the information and metrics you need to get funded. It’s a good idea to be transparent with your ITA about the strengths and weaknesses of your project, so they can help you improve your chances of success.
When you are provided with a template for the formal proposal, it’s important that all of the information be accurate and that the proposal is submitted at the agreed upon time. The IRAP team may reach out for further information and clarifications, so it’s best to include the most accurate and complete information for your project, in order to avoid delays.
Step 4: Project Execution, Reporting
Once your project has been approved, it’s time to execute and report. Your ITA will continue to support you with advice, introductions and connections to additional services, so keep in touch and be open about any difficulties. Again, it’s important that all reporting be timely and accurate, so now it’s time for your accounting and legal teams to shine.
IRAP is a popular government contribution program for good reason: it supports entrepreneurs and innovators like you with the funding and advice you need to succeed, just when you need it. No company is too small to receive IRAP assistance. If you meet the criteria mentioned above, give the team at NRC-IRAP a call at 1-877-994-4727.
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