Small Flying Objects meet vouchers and coaching: what the UFO project funded under Horizon 2020 is doing

The UFO project is a European Commission backed initiative using Horizon 2020 INNOSUP resources to stimulate innovation among small and medium sized enterprises by combining Small Flying Objects with nano and digital technologies. Official project materials state that the consortium is providing a total of three million euros in cascade funding. That money is distributed as vouchers to support feasibility studies and demonstration activities for SME-led innovation projects that link Small Flying Objects to emerging industry needs.

Scale and structure of the support

UFO ran two open calls during 2021. The first closed on 18 February and the second closed on 7 October. Across the two calls more than ninety eligible proposals were submitted. The initiative was implemented by partners located in five countries: Bulgaria, France, Greece, Romania and the United Kingdom. Cross border consortia were encouraged.

From the eligible proposals the consortium selected twenty five projects to fund. The portfolio comprises twenty one demonstration projects and four feasibility studies. The awarded projects will receive direct financial support and a package of non financial acceleration services. Financial support is allocated as vouchers with a maximum amount of sixty thousand euros for each feasibility study and up to one hundred and fifty thousand euros for each demonstration voucher.

What is being funded and why it matters

The selected projects integrate Small Flying Objects with embedded nano and digital technologies, Key Enabling Technologies and data analysis or exploitation solutions. The stated objective is to create new products and services in areas where airborne sensing, communications or platforms can add value. The UFO project's stated industry focus covers blue growth, digital creative and gaming, mobility, climate, environment and finance and insurance.

Non financial support and acceleration services

Beyond vouchers, the UFO consortium provides an acceleration programme with project level coaching. The programme aims to help awarded SMEs to access additional public funding at regional, national or European level. It also offers support to access private funding, help with exploitation and scale up, dissemination at the European level, networking and market realisation assistance. These services are standard in European cascade funded projects because small grants by themselves seldom create sustainable scale without guidance and connections to follow on finance.

The effectiveness of acceleration services depends on execution. Coaching can improve proposals and access to later stage grants. However, small demonstrations often fail to bridge the so called valley of death unless they unlock substantial follow on investment or long term procurement commitments. Evaluating impact therefore requires transparent metrics on how many projects secure follow on funding, commercial contracts or regulatory approvals.

Geography, eligibility and scope limits

Although the UFO project's ambition is to stimulate SMEs across Europe, the open calls were limited to applications from partners in the five countries that host the consortium. That narrower geographic focus reduces the ability of the project to act as a pan European instrument. The presence of the United Kingdom among partner countries is notable because the project ran under Horizon 2020 rules during a period when UK organisations could still participate. The UFO project documentation also states an aim to finance up to seventy five SMEs. In practice the announced cascade funding and the 25 selected projects mean a more modest reach.

Technical and regulatory frictions that could slow uptake

Bringing SFO based products to market confronts several predictable barriers. Regulatory regimes for unmanned aircraft vary across EU countries and between airspace levels. Data protection and privacy rules apply to aerial sensing in populated areas. Spectrum allocation and coordination are required for connectivity use cases. For small satellites, access to launch options and ground infrastructure remains a gating factor. These are not solved by a single demonstration grant and require coordinated policy and industry responses.

Why this matters for the European innovation ecosystem

The UFO project sits at the intersection of two trends in EU innovation policy. First, the use of cascade funding to reach SMEs with small, targeted grants has become a common way to get public money closer to the market. Second, there is growing interest in airborne and space enabled services for economic sectors such as maritime monitoring, mobility, and environmental observation. By targeting these domains the project attempts to convert platform technologies into concrete industrial applications.

Nevertheless the broader impact will depend on follow on finance and ecosystem support. The European Innovation Council and the successor Horizon Europe programmes offer larger instruments for scaling. For SME pilots supported by UFO to become market leaders they will need to attract private investment, secure procurement deals and navigate regulatory approvals. That requires visibility, credible business models and investor ready teams. The acceleration package is designed to help but it cannot replace larger scale funding and lengthy regulatory processes.

Event and next steps

The project announced a final showcase event for 17 November 2022 in London where the funded products and services developed by the SMEs were scheduled to be presented. The public materials include links to the winners of the first and second calls. As with many EU supported pilot programmes, the true test of success will be demonstrable commercial traction and transparent reporting of outcomes beyond the initial demonstrations.

What to watch for and suggested metrics

To assess the value created by UFO look for the following data in post project reporting. How many awarded SMEs obtained follow on public grants or equity investment within twelve months. How many pilots led to commercial contracts or procurement by public sector buyers or industry partners. Evidence of regulatory approvals or operational deployment across borders. Job creation and revenue growth attributable to funded activities. Finally, independent evaluations that compare the cost of cascade funding against measurable market outcomes will be essential to judge whether the approach should be scaled or redesigned.

Bottom line

UFO is a targeted, small scale attempt to nudge European SMEs toward integrating airborne and space enabled platforms with advanced components and data analytics. The mix of feasibility and demonstration vouchers plus coaching is the right design for early stage experimentation. The limits are funding scale, geographic scope and the significant technical and regulatory hurdles that SFO applications face. The project could catalyse useful prototypes and partnerships. But turning those prototypes into sustainable businesses will require follow on capital, clearer regulatory pathways and sustained market demand.