New to R&D Grant Takuhe Pihinga R&D

You can apply if your business is part of a group, as long as the group does not have access to existing R&D capabilities.

Your business will be classed as part of a group if it has:

• common ownership — if 50% or more of the business is owned by the same shareholder (individual or business) as another organisation
• common directors — if there is a sole director or the same directors across multiple businesses
• policy-based groups — if Innovation Services considers the businesses to be grouped by policy, they are grouped for R&D spend purposes, regardless of ownership share.

For example, your business is grouped if it is a sister company, parent or subsidiary of another company.

You’ll need to confirm you are not 50% or more owned or controlled by any of the following:

• local authority and local regional promotions bodies
• government departments or agencies
• state-owned enterprises
• Public Finance Act 1989 Schedule 4A companies
• crown entities
• Crown Research Institute 
• Tertiary Education Organisations including any that are foreign owned
• entities controlled by any of the above — control means 50% or more ownership
• sole traders
• charitable trusts
• partnership
• joint ventures
• look through companies
• trusts, other than a Māori Trust listed under ‘Make sure your business can apply’ above
• a company that was incorporated in another country but is registered to do business in New Zealand.

Learning customer-focused R&D skills helps you:

• understand who your customers are and what they need
• define the problem you’re solving
• develop products and services customers want.

Understanding your customers

Validating your business idea

Learning IP capability helps you:

• understand the importance of the IP
• identify key IP
• learn how to protect it. 

For patent work or advice, do your due diligence on training providers, including whether they are registered or recognised by any industry body. It’s recommended that you contact a trans-Tasman patent attorney.

Intellectual property

This capability helps you: 

• understand the regulations that affect your R&D and final product
• identify regulatory bodies and standards in different markets.

Compliance Matters Tool

Operating overseas: rules and compliance - Collection – myNZTE

Lean is a proven framework to improve processes, increase value and reduce waste.

It can help you:

• map R&D processes to visualise and analyse the flow of activities
• run efficient R&D projects and manufacturing 
• encourage teamwork, flexibility and continuous improvement.

Lean manufacturing

The Lean Hub – Lean Hub

Project management capability helps you:

• plan, prioritise and manage R&D projects
• meet deadlines and budgets
• manage resources efficiently
• document decisions, knowledge and progress, including reasons for budget, resource or schedule changes.

What good looks like: Project management – Audit New Zealand

This capability helps you:

• collect, organise and store R&D data
• make better decisions though clearer insights
• protect user privacy and manage information.

Archives New Zealand has content and resources to help you understand information management. Although it relates to government, the website links to training providers, and gives tips on developing information and record management strategy and policy.

Manage information – Archives New Zealand

Innovation Services needs details about your business, including:

• business name
• business address
• New Zealand Business Number (NZBN)
• New Zealand business bank account details for reimbursement
• Australian and New Zealand Standard Classification of Industries (ANZSIC) details
• a key contact person
• information about what kind of business it is, what it does, background and compliance
• financial information for the last 3 years
• if your business has any issues that could harm the reputation of MBIE or its R&D programme. 

You’ll also need to describe how you will run and co-fund your R&D activities, including:

• an R&D project title, start date, and end date
• your planned R&D capability development and activities, including an R&D and capability development plan
• the total project cost
• how you’ll co-fund the R&D activities — a cashflow template is in the Innovation Services online portal
• a cost breakdown, including labour, materials and depreciation. 

If your R&D involves overseas labour, you’ll need to provide more information. This is assessed on a case-by-case basis.

Eligible costs for New to R&D Grant

You’ll need to confirm your business:

• is new to R&D
• intends to conduct R&D in the future
• has received less than $5,000 in government R&D funding in the past 3 years
• has spent less than $150,000 on R&D in the past 3 years
• can pay its 60% share plus other business expenses
• isn’t part of a corporate group with access to existing R&D capabilities. 

You’ll need to briefly explain how your proposed work is R&D. It should meet the following criteria:

• Uncertainty — What scientific or technological uncertainty are you facing?
• R&D challenge — Why is your challenge difficult to achieve?
• Knowledge availability — What other solutions are you aware of that achieve a similar outcome, and are those solutions available to you?
• Newness — What new knowledge or new or improved processes, services or goods will your R&D create?
• Better — How will your solution improve on what’s currently available?

The New to R&D Grant will co-fund 40% of your R&D costs, up to $400,000. You’ll fund the other 60%.

To show you can co-fund your 60%, you’ll need to provide:

• a 12-month cashflow forecast (a cashflow template is in the Innovation Services online portal)
• a bank statement confirming the opening balance of the cashflow forecast
• your latest year-to-date Balance Sheet
• your latest year-to-date Profit and Loss Statement.

If you’re still raising funds, Innovation Services can approve the grant in principle. You’ll have up to 6 months to secure the funding.

Find templates for Balance Sheets and Profit and Loss Statements on the ‘Strategic finance’ page.

Strategic finance

If you’re using capital investment, you can provide evidence of:

• internal investment — a shareholder declaration supported by evidence of cash or liquid assets
• external investment — a signed term sheet supported by the cashflow forecast showing when you’ll get the funds, or a letter of intent from a potential investor.

Internal investment is money that comes from within your business. For example, your profits or savings.

External finance is money that comes from outside your business. For example, investors or lenders. In return, they may expect something back, such as part ownership in your business or interest on the money you borrow.

When you apply, you’ll need to provide details of your planned R&D, as well as a high-level overview of your future R&D plans.

Make sure what you plan to do fits the R&D definition.

What R&D is

Some supporting activities may qualify as R&D if they are key to your planned R&D work. For example:

• writing specialised software to monitor R&D results
• designing and producing testing or analysis equipment
• routine crop management of plants for core R&D activity
• documenting results for internal approval
• disassembling testing equipment or prototypes and disposing of waste.

Activities on this list are not usually eligible unless they are essential for your R&D:

• market research, testing, development, or sales promotion
• reproducing existing products or processes from examination or public information
• minor adaptations or improvements to existing offerings
• data mapping or migration testing
• research in social sciences, arts, or humanities
• cosmetic or stylistic changes
• bug, beta, system requirement, user acceptance, or data integrity testing
• comparing already proven algorithms
• testing security protocols to uncover flaws
• converting or integrating systems onto new software platforms
• routine data operations or presentation
• writing test results, analysis, or maintaining R&D documentation.