This post is part of a collaborative effort between Startup Portugal, The Next Big Idea, and Sapo24, meant to create relevant content to tackle the COVID-19 pandemic.
Content available in Portuguese.

The Portuguese startup ecosystem is still young, but it’s, hands down, one of the best assets Portugal has, with small-scaled but fast-paced and steadily growing companies representing over 1% of the country’s GDP. With this in mind, the Portuguese Government issued a relief fund exclusively for startups to help mitigate the impact of the COVID-19 pandemic in startups. These new measures add up with initial relief package meant for SMEs, where startups are also included. In total, this support could go up to over 300 million euros for the more than 2500 companies now hacking new solutions from Portugal.

Startup Portugal is breaking down this information so you can have a better understanding of how each measure works, and how each entrepreneur and startup can apply for this supports.

Some programs are already up and running, while others are still being prepared. Thus, this article will be under permanent review and will be updated with news regarding application processes, etc., while they are released.

Startup RH Covid19

This is a program meant to help startups retain their talent and to prevent layoffs. This is a €8 million fund, that can help up to 10 employees per company.

This implies:

• €635 wage for employees;

• applicable to up to 10 employees;

• beneficiaries can’t dismiss or layoff staff for the remainder of 2020;

• registration in the Startup Hub or in an RNI incubator.

Companies eligible for Startup HR Covid19:

• have been set up less than 5 years ago;

• have no debts to the IRS or Social Security;

• are not in lay-off.

This support is cumulative with

• Incubation Voucher.

This fund can go up to €8M in support for startups and is managed by IAPMEI. The program is soon to be launched.

Startup Voucher extension for 3 months

Startup Voucher is one of the key initiatives for entrepreneurship promotion in Portugal. It aims to reduce the risks youngsters take by venturing and creating a company, by granting a scholarship of €700 per entrepreneur (up to 3 per project), incubation and mentorship. Amidst the COVID-19 crisis, making sure these people can still hack and work in new products and solutions is of the utmost importance.

This implies:

• extension for 3 more months of the Startup Voucher;

• postponing of evaluations, and subsequently of the payment of completion prizes, for 3 months;

• meant exclusively for people already benefiting from Startup Voucher.

This fund can go up to €300 thousand, having been designed for the current 75 projects benefiting from the Startup Voucher program.

The process is managed by IAPMEI and the extension is already available.

Incubation Voucher Covid19

The Incubation Voucher is a program already created by the Portuguese government with the purpose of supporting startups to acquire incubation services, be it office space, mentorship, and other services provided by incubators and accelerators. Based on the original program, the government created its Covid19 counterpart, set to help startups acquiring these services.

This implies:

• support of €1.500 per startup to be paid immediately;

• beneficiaries can’t dismiss or layoff staff for the remainder of 2020;

• registration in the Startup Hub.

Are eligible:

• companies set up less than five years ago;

• companies based in an incubator certified by RNI – National Network of Incubators.

Cumulative with:

• Incubation Voucher (companies who benefited from the program under different conditions are still eligible);

• Startup RH Covid19.

This program can go up to 4M€, having in mind over 2500 startups based in Portugal.

The process is managed by IAPMEI and is soon to be launched.

Mezzanine funding for Startups

Designed to protect startups who have benefited from investment, the Mezzanine fund will issue loan tickets of between €50k and €100k that can be converted into equity. It’s meant to ensure startups have cash flow and a strategic route to survive the ongoing crisis.

This implies:

• beneficiaries can’t dismiss or layoff staff for the remainder of 2020;

• registration in the Startup Hub;

• submission of a report stating all the negative impacts of the pandemic in the business

• beneficiaries must have benefited from a previous investment round (seed level included)

• beneficiaries must have taken part in technology transfer processes;

• have a mentor set for the next 12 months (cost included in the ticket)

Are eligible:

• companies with between 1 and 8 years of operations;

• companies with no debts to the IRS or Social Security.

This fund can go up to €10M and is managed Portugal Ventures. The program is soon to be launched.

Covid-19 Portugal Ventures’ call

Portugal Venture’s is a key venture capital player in the Portuguese startup ecosystem. This new call is designed to invest in startups with bridge financing and can be used to complement an ongoing investment round.

This implies:

• beneficiaries must be eligible by the rules of Linha de Financiamento a Fundos de Capital de Risco da IFD;

This fund can go up to €3M and the process is managed by Portugal Ventures. The program is soon to be launched.

Other financing solutions

These five new measures are not the only ones meant to support startups. As stated previously, some government supports for SMEs also target startups. Besides, there are also other instruments for financing which have been issued by the Portuguese government during this crisis that can be used by startups. The programs below are already up and running.

200M co-investment fund

• a fund for co-investment with international partners;

• managed by PME Investimentos;

• now accepts new rounds with no need to find new investors;

• minimum ticket of €500k;

• maximum ticket of €5M;

• fund of up to €200M.

 More information.

Social Innovation Fund

• a fund for companies working with social impact businesses

• managed by PME Investimentos

• minimum ticket of €50k

• maximum ticket of €2,5M

• fund of up to €42M

More info on eligibility.

More info on the application process.

Besides the above mentioned, in another article, we wrote in detail about the government relief funds available for SME. Do dive in and find out if your company is eligible for benefiting of them. Read all about the government support for SMEs.

There are also other financing tools available in Portugal, which Startup Portugal mentioned in this article.

In total, the Portuguese Government has made available more than €300M in support for startups, €25M of which are exclusively for startups and designed to provide cash flow. Fuel to make these innovative businesses power through the ensuing crisis startup with the COVID-19 outbreak.