1. Background
The Netherlands wants to help accelerate sustainable development, including economic
development and employment. It does this among other things by promoting entrepreneurship
the world over, especially among young people in developing countries. Youth employment
and young entrepreneurs are special priorities in the development policy of the Minister
for Foreign Trade and Development Cooperation (hereafter: the Minister) and in the Youth at Heart strategy. Young entrepreneurs have the energy and inventiveness required to develop
solutions to local challenges, which can stimulate employment and innovation. This
is also recognised in Resolution 73/225 (‘Entrepreneurship for sustainable development’), adopted by the UN General Assembly on 20 December 2018. The Resolution emphasises
the pivotal role of entrepreneurship in achieving sustainable development and recognises
that entrepreneurship drives economic growth by creating jobs, promoting decent work
and sustainable agriculture, and fostering innovation.
Startups in Africa, the Middle East and Asia need support for both knowledge and finance
to develop and scale up innovations. Especially in the pre-commercial phase of the
innovation process (ideation, research and development, and proof of concept), in
which an idea is tested and a prototype developed, only limited funding is available.
In this phase it is often impossible for entrepreneurs in developing countries to
attract the capital they need, due partly to an unattractive risk profile and the
high interest rates that local banks charge for loans. Companies must be supported
so as to bridge this pioneer gap and enable them to grow.
The Netherlands’ extensive experience in the field of entrepreneurship means it is
well placed to help address these challenges and support young entrepreneurs in establishing
and developing their own businesses.
The Orange Corners Innovation Fund (OCIF) Grant Programme was launched to supplement
the Orange Corners Incubation and Acceleration programmes (OCIAC), which give young entrepreneurs access to training, networks and facilities to launch
their business or scale it up. OCIF began as a pilot project in 2019 and has been
a grant programme since 2021. The provision of flexible financing at an early stage
has proven to foster company growth and increase employment. Because of this positive
impact, the Minister would like to prolong the initiative, drawing on the lessons
learned in its initial years. In particular, more attention will be paid to improving
the investment-readiness of participating businesses and to obtaining commercial or
other follow-up funding.
The grant programme focuses on supporting startups in the initial phase of their innovation
process. It is aimed at the countries where an OCIAC is active, as well as Tunisia.
OCIF grants will be awarded to applicants (fund managers) to establish a fund to provide
startups with financial support for their capacity and knowledge building. The approach
in each of the target locations will be tailored to the specific wishes and needs
of the participating startups.
2. Implementing organisation
The Netherlands Enterprise Agency (RVO), an agency of the Ministry of Economic Affairs
and Climate Policy, will implement this grant programme on behalf of the Minister
for Foreign Trade and Development Cooperation on the basis of a mandate issued to
it by the Minister.
3. Definitions
The following definitions are used in the grant programme:
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Ideation: the phase in which a startup further refines its initial, rough business model;
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Investment-readiness: a company’s capacity to understand and satisfy investors’ needs and expectations;
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Local civil society organisation: a not-for-profit organisation established in a target location, not connected to
a government organisation either de facto or under its constitution, which serves
a public interest and possesses legal personality under civil law in the country where
it has its registered office. It must not have been established by a government organisation
or must have become fully autonomous from the government organisation that established
it. The organisation must also be registered accordingly in the target location where
the grant-funded activities will be implemented;
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Local company: an organisation other than a civil society organisation that carries out economic
activities and has legal personality under civil law in the country where it has its
registered office. An economic activity is the offering of goods or services on an
economic market. The organisation must be registered in the target location where
the grant-funded activities are to be implemented;
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Minister: the Minister for Foreign Trade and Development Cooperation;
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Pioneer gap: a gap in the earliest phase of a company, between constructing a first prototype
and achieving impact at scale, in which many investors have no interest in investing
in the company;
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Proof of concept: the realisation of a certain method or idea to demonstrate its feasibility, or a
demonstration aimed at verifying that a concept or theory has potential;
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Startups: unlisted companies that have existed for less than five years and are conducting
innovative activities, such as developing or delivering innovative products or services
in the target location which will help to achieve the Sustainable Development Goals
(SDGs);
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Target location: a country, or regions within a country, where activities are organised in the framework
of the grant programme;
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Theory of change: a model that describes how an intervention will achieve the intended change.
4. Orange Corners Innovation Fund Grant Programme 2024–2030
4.1. Aim
The grant programme’s short-term aims are to:
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1. encourage young entrepreneurs in Africa, the Middle East and Asia to build successful
companies based on providing innovative solutions to major local challenges;
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2. enable young entrepreneurs in Africa, the Middle East and Asia to scale up their company
and create jobs;
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3. enable young entrepreneurs in Africa, the Middle East and Asia to attract commercial
or other follow-up funding.
The grant programme’s long-term aim is to enable young entrepreneurs in Africa, the
Middle East and Asia to scale up their company, create jobs, strengthen the local
entrepreneurial ecosystem and help solve local social problems.
4.2. Target group
The grant programme aims to fund activities in Côte d’Ivoire, Ghana, central Iraq,
the Kurdistan Region in Iraq, Morocco, Mozambique, Nigeria, Senegal and Sudan, and
in the new target locations Algeria, Angola, Bangladesh, Burundi, the Democratic Republic
of the Congo, Egypt, Jordan, Mali, the Palestinian Territories, South Africa, South
Sudan and Tunisia.
The OCAIC website offers more information on the specific regions in the target locations.
The ultimate target group in these target locations consists of startups, preferably
ones that have taken part in a component of the OCAIC, that have an innovative business
plan. All activities supported by OCIF should contribute to improving the local business
climate.
4.3. Parties that may be eligible for a grant
Local companies and local civil society organisations may be eligible for a grant.
The applicant must:
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• be legally authorised by a competent authority in the target location to make loans;
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• have experience with managing an investment fund;
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• meet all the necessary administrative and regulatory requirements, and has experience
with impact management and impact assessment;
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• be capable of proper financial management and can ensure effective and efficient implementation
of the activities for which grant funding is sought;
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• be capable of conducting a risk analysis, identifying contextual, implementation and
RBC risks and where necessary take measures to mitigate the main risks;
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• demonstrate that it has adopted an integrity policy and that it has introduced procedures
to apply that policy. This integrity policy and these procedures should prevent as
much as possible any sexual misconduct and other serious forms of inappropriate behaviour
towards employees and other individuals during the implementation of the proposed
activities by the applicant and any other parties they involve in the activities,
and in the event of such incidents, to investigate and take appropriate measures to
put an end as promptly as possible to the misconduct or inappropriate behaviour and
mitigate the consequences. These procedures must be structured in a way that guarantees
prompt reporting of any such incidents to RVO.
Applicants for a grant to carry out activities under the grant programme in Morocco
should note that the Moroccan authorities (specifically the Moroccan Ministry of Foreign
Affairs) will be informed of the grant recipient’s name, the grant programme’s objectives
and the duration of the activities for which the grant is awarded.
4.4. Recommendation
Before submitting a grant application, the applicant must request a recommendation
based on a screening tool submitted for this purpose. The recommendation is issued by an RVO adviser and is
non-binding. It is up to the applicant to decide whether or not to submit an application.
If the applicant decides to submit an application, it is responsible for demonstrating
that it satisfies the criteria to be eligible for a grant.
As a request for a recommendation takes three weeks to process, requests submitted
less than three weeks before the application deadline for a round will be rejected.
4.5. Eligible activities
The following activities are eligible for a programme grant.
Provision of financing in Track I and Track II
Track I activities entail support for startups participating in the OCAIC (incubatees)
or, if there is no OCAIC in the target location in question, in another appropriate
incubation/acceleration programme. Support can be provided for starting and building
a company. For instance, funding can be provided for registering a company, developing
a prototype or new products and services, engaging third parties, and other means
necessary to building innovative, sustainable companies. In the course of Track I,
support may also be provided to help a company prepare for selection for Track II.
Track I has the same duration as the incubation or acceleration programme in the target
location (an average of six months). Track I financing consists of a grant of no more
than € 5,000 for each individual entrepreneur.
Track II activities involve additional support to the most promising companies, preferably
companies that have completed Track I activities, which are selected during one or
more selection days. These companies will have access a larger amount of capital,
which can consist of a loan (which may or may not be interest-bearing) and/or a grant.
The composition of the capital depends on the local situation, but it may not amount
to more than € 50,000 for each individual entrepreneur. The capital will be paid out
to the entrepreneur in several tranches on the basis of previously agreed Key Performance
Indicators (KPIs). The applicant will develop an implementation plan and a selection
process for this purpose.
Technical assistance to promote investment-readiness
Participation in incubation or acceleration programmes does not always result in the
selected entrepreneurs being able to meet all the requirements for a commercial loan.
Additional training, coaching and mentorship can enhance investment-readiness. This
technical assistance will be provided on the basis of a needs assessment and must
be agreed with the OCIAC.
Network support and follow-up financing
Some young entrepreneurs will need follow-up financing to enable their company’s continued
growth. To this end, activities can be organised to put entrepreneurs in touch with
local and international investors, such as angel investors, venture capital funds,
commercial banks or other appropriate parties. Efforts will be aligned as much as
possible with other funds and programmes financed by the Dutch government. There are
also opportunities to improve market access by actively putting young entrepreneurs
from different target locations in touch with one another.
Activities which already receive grant funding or a contribution directly from the
Ministry of Foreign Affairs budget are not eligible for a grant.
4.6. Duration of activities
The activities for which a grant is requested must have a minimum duration of six
years and must be completed by 31 December 2030 at the latest. The activities must
start within four months of the grant award and should to the greatest extent possible
run parallel to the OCAIC programme in the target location.
4.7. Size of the grant
Grants will be awarded for no more than 95% of the eligible costs, up to a maximum
of € 2,200,000. The minimum grant amount is € 1,800,000.
This means that the own contribution must be at least 5% of the eligible costs. After
the activities have been concluded, the own contribution may be deducted from the
repaid Track II loans (see section 5.1).
5. Eligible costs
5.1. Principles
In calculating the eligible costs for a grant, the following principles apply:
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– costs must be necessary and proportionate for the implementation of the activities
for which grant funding is sought;
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– costs must be directly related to carrying out the activities;
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– only costs incurred after the application is submitted are eligible for a grant;
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– internal costs are eligible without mark-up;
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– costs will be compared with local standards and assessed for reasonableness;
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– revenues obtained directly from the activities, for example for providing training
and advice, will be deducted from the eligible costs;
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– the own contribution may be deducted from revenues from repaid loans, if these funds
will be spent once more on activities that contribute to the grant programme’s objective
and the grant recipient has submitted a request to this effect in advance.
5.2. Eligible costs
The following costs to be incurred by the applicant are eligible for a grant:
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a. Direct wage costs, calculated as an hourly rate multiplied by the number of hours
worked by people directly involved with the eligible activities, plus an additional
50% for indirect costs. Direct wage costs are the gross wage costs plus employer contributions,
the costs of fringe benefits, fees and redundancy payments;
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b. Depreciation of assets during the course of the activities: the basis for determining
depreciation is the purchase price – taking any residual value into account – plus
any adjustment costs;
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c. Costs of third parties: costs payable to third parties, supported by an invoice, for
example if any eligible activities are outsourced, and costs of goods and services
purchased for the eligible activities;
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d. Financing costs: the provision of loans and grants and the associated transaction
costs;
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e. Subsistence costs: the maximum reimbursement is the number of nights multiplied by
the UN Daily Subsistence Allowance rates in effect on the project starting date.
The following costs relating to the eligible activities (section 4.5):
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f. Costs of providing financing
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– Fund management: including the costs of activities such as organising meetings, drawing
up annual plans, monitoring and reporting, and keeping business records;
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– Fund management costs may not exceed 15% of the total eligible costs;
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– Monitoring and evaluation during the duration of the activities;
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g. Costs for technical assistance and strengthening networks
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– Costs of activities such as organising meetings and events, and training and mentorship
for entrepreneurs;
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– The costs of technical assistance may not be less than 10% or more than 20% of the
total eligible costs;
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– Maintenance of all or part of the products or services provided during the course
of the activities.
5.3. on-eligible costs
The following costs are in any event not eligible:
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– costs associated with developing, preparing or submitting the application;
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– value-added tax (VAT), in so far as this is not a cost item;
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– costs due to inflation and exchange rate fluctuations which are greater than 5% of
the total eligible costs;
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– costs of registering and maintaining intellectual property rights.
6. Application
6.1. Requirements
Before submitting their grant application, an applicant must ask RVO to issue a recommendation
based on a screening tool, as described in section 4.4.
Applications must be submitted in English using the form supplied for this purpose,
which can be downloaded from the RVO website. The form must be accompanied by the
documents specified in it, in the format prescribed by RVO.
The application must in any event include:
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− the reference number of the recommendation issued by RVO;
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− an activity plan drawn up in line with section 4 (except for section 4.4) and not
exceeding 25 A4 pages (single spacing, Verdana 9 font). It must include a risk analysis
identifying contextual, implementation and RBC risks and where necessary measures to mitigate the main risks;
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− proof of legal authorisation to make loans in the target location;
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− a budget, drawn up using the form available on the RVO website, including a liquidity
forecast;
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− a timetable of the activities;
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− CVs of the applicant’s staff members who will be involved in implementing the activities;
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− annual accounts for the last two years (t-1 and t-2) audited by an external, independent
auditor or, if no audited annual accounts are available yet, non-audited annual accounts
for one or both of these years;
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− a theory of change, including a monitoring and assessment plan, in accordance with
the guidelines on the RVO website.
The applicant must also declare that it is aware of and will act in accordance with
the OECD Guidelines for Multinational Enterprises, and that it is aware of the exclusion list of the FMO, the Dutch development bank,
and will not engage in any activities on that list. The IFC Performance Standards also apply. The applicant must declare that it is aware
of and endorses these standards. The applicant must immediately notify RVO of any
facts or circumstances that indicate breaches of these guidelines. The applicant must
be open to making improvements if requested.
6.2. Remedy period
With regard to the application procedure, particular attention is drawn to article 7, paragraph 3 of the Ministry of Foreign Affairs Grants Decree. If an incomplete application is submitted, the Minister may request a supplement
in accordance with Section 4:5 of the General Administrative Law Act. In this case, the date and time of receipt of the application will be the date and
time on which the supplement was received; a supplement may not be submitted after
the deadline for the submission of applications. Moreover, incomplete or insufficiently
substantiated applications (in whole or in part) may be rejected on the grounds of
failure to adequately satisfy the requirements and criteria.
When completing the form, it is not sufficient to refer for the sake of brevity to
other parts of the application, websites or annexes, unless the application form states
that this is wholly or partly acceptable. Incomplete applications may be rejected.
7. Assessment of applications and allocation of resources
The provisions of the General Administrative Law Act, the Ministry of Foreign Affairs Grants Decree and the Ministry of Foreign Affairs Grant Regulations 2.006 are fully applicable to the assessment of applications and the award of grants under
this grant programme. Applications will be assessed in accordance with the above legislation
and the requirements set out in this grant programme.
To be eligible for a grant, applications must satisfy the requirements above, especially
those set out in sections 4 to 6. Only applications that meet these requirements will
be substantively assessed on the basis of the criteria below. Applications must achieve
a minimum score of 60 points out of the maximum of 100 points and at least 40% of the total number of points
for each set of criteria in order to be eligible for a grant. For each target location,
the application that best meets the criteria will be given priority in the award of
grants, followed by the application that is ranked second.
The following criteria apply (the maximum number of points that can be awarded in
each category is indicated in brackets):
Policy contribution and impact (20 points)
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a. The extent to which the activities contribute to developing and stimulating innovations
in the local conditions;
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b. The extent to which the activities align with the local policy priorities regarding
private sector development of the Embassy of the Kingdom of the Netherlands accredited
to the target location in question;
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c. The extent to which the activities enhance the knowledge and the access to finance
of the local target group;
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d. The extent to which the activities have added value compared with existing activities
aimed at providing the local target group with access to finance.
Intervention strategy/action plan (35 points)
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a. The extent to which the intervention designed as part of the activities is based on
sound and accurate contextual, stakeholder and problem analyses;
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b. The extent to which there is a sound plan for monitoring, measuring the effects of
and learning from the activities;
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c. The extent to which there is a sound plan for coordination with the OCIAC and/or another
incubation/acceleration programme;
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d. The extent to which there is a sound plan for selecting entrepreneurs from the OCIAC
and/or another incubation/acceleration programme;
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e. The extent to which there is a sound plan for financing Track I and Track II activities,
organising technical assistance, and supporting innovations in obtaining commercial
or other follow-up financing;
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f. The extent to which there is a clear action plan for coordination of and internal
and external communication about the activities;
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g. The extent to which efforts are made to align with the activities of the local financial
sector and the extent to which there is a sound plan for knowledge exchange with actors
in that sector;
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h. The extent to which there is a clear, sustainable, long-term business plan and vision
(exit strategy).
Investment management (20 points)
The extent to which the applicant has the following experience or competences:
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− fund management;
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− investing in startups;
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− impact management and measurement;
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− maintaining a relevant network;
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− an understanding of the local situation;
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− demonstrable affinity with investment in innovative companies;
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− a solid reputation as a fund manager.
Financial (15 points)
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a. The extent to which the costs included in the budget are reasonable;
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b. The extent to which the impact of the activities, in qualitative and quantitative
terms, outweighs the costs incurred.
RBC and implementation risks (10 points)
In addition to compliance with the OECD Guidelines, the applicant must demonstrate:
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a. the extent to which the activities will contribute to RBC and make a positive contribution
to the environment, good working conditions and land and human rights;
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b. the extent to which the main RBC risks are identified and measures are formulated
to mitigate these risks;
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c. the extent to which satisfactory risk management is in place, consisting of a satisfactory
risk analysis and satisfactory measures for mitigation.
In aid of its assessment, RVO may undertake action to verify any assumptions or statements
made in the application. As part of this action, RVO may check the applicant’s references
and collect any information needed to properly assess the quality of the application.
RVO may also consult external experts during the substantive assessment procedure.
The Embassies of the Kingdom of the Netherlands are always asked to participate in
the assessment of applications, in particular concerning the extent to which applications
are aligned with the mission’s policy and with the local situation.
8. Grounds for rejection
In addition to the grounds for rejection set out in section 4:35 of the General Administrative Law Act, a grant application will be rejected if it does not satisfy the provisions of this
grant programme or if the budget available is insufficient.
9. Oversight
RVO will carry out random checks to assess the proper use of grant funds, checking
regularity and efficiency under the terms of the grant decision.
10. Obligations
The grant decision will set out the obligations tied to the grant, including in any
event an obligation to notify RVO if the grant recipient cannot (or cannot fully)
comply with the conditions of the grant and/or cannot (or cannot fully) carry out
the activities for which the grant has been awarded. It will also forbid the grant
recipient and the primary supplier from using child and/or forced labour. The grant recipient must also immediately notify RVO of any facts or circumstances
that would suggest these organisations are using child and/or forced labour.
The grant decision will also provide for an initial three-month period to fine-tune
the grant recipient’s cooperation with the OCIAC, and where necessary make adjustments
to avoid duplication and ensure synergy. At the end of the three months the grant
recipient will submit an action plan agreed with the OCIAC to guide the implementation
of activities.
The reporting obligations will include a stipulation that the grant recipient must
arrange for an audit to be carried out by an independent external auditor halfway
through the grant period and after its conclusion.
The grant recipient will also be asked to submit a report one year after the activities
have been concluded, reporting on the progress made by the entrepreneurs supported
by the project. RVO will use this report to assess the programme’s sustainability.
As great importance is attached to adaptive programming, a grant recipient will be
able to modify the action plan during the course of the activities if new insights
are obtained or new situations arise. The grant recipient will set out these insights
in its annual report and submit a request for amendment if it wishes to modify certain
elements.
The grant decision may also require the grant recipient to ensure that the organisations
or persons it intends to work with do not appear on EU or UN international sanctions
lists, as these are excluded from funding. In appropriate cases, this obligation will be
formulated so as to ensure that the grant recipient must apply it to agreements with
third parties.
11. Administrative burden
A test based on a standard cost model has been carried out in the interests of accountability
for the administrative burden that the applicant will face, from drafting and submitting
the application to the management phase, the determining of the definitive grant amount,
and any objection and appeal procedures. The calculation shows that the administrative
burden expressed as a percentage of the total available grant budget is 2.4%.
