Request for Proposals: LuxAid Demonstration Fund (Kosovo)

The LuxAid Demonstration Fund is a new initiative from the Luxembourg Development Cooperation aimed at pioneering commercial solutions that tackle development challenges.

The LuxAid Demonstration Fund targets well-established, mature enterprises in Kosovo with proven innovative and commercially viable solutions. The Fund will typically focus on supporting the scale-up of the solutions whose impact has been proven on a smaller scale, yet present challenges to grow. Moreover, it targets projects with a potential to inspire changes in a value chain or market segment.

Goals

• The overarching goal of the LuxAid Demonstration Fund is to contribute towards the achievement of the Sustainable Development Goals (SDGs). In Kosovo, in alignment with relevant country strategies, interventions promoting circularity, digitalisation, and specialisation in the manufacturing sector are vital to ensure sustainable development within the country. Circular economy practices increase efficiency and promote sustainable production, benefiting communities by safeguarding resources and protecting the planet. Meanwhile, digitalisation enhances access to information and skills, fostering economic resilience and inclusion, and supporting quality education.

Focus Areas

• This call for proposals is open to innovative solutions from enterprises with a focus on:
  • Circular economy innovations in the manufacturing sector, with a focus on waste and resource management and efficiency;
  • IT innovations for the manufacturing sector, prioritising:
    • Solutions that leverage digital technologies to update/streamline production processes and optimise supply chain management, including traceability, improved accountability, etc.;
    • Software solutions (SaaS, IaaS cloud computing approaches) enabling resource management and efficiency and circular approaches in the manufacturing sector;
  • Innovative approaches for skills development through enriched specialisation and skills development programmes for the manufacturing sector;
  • IT innovations that contribute through digitalisation to improved access to education, healthcare, and mobility services for the local population.

Funding Information

• Co-financing range: Through this first call for proposals, 3 – 4 innovative solutions will be granted up to EUR 350,000 per project, representing up to 50% of their project costs.
• Proposed business project duration: 1 to 2 years.

Outcomes

• The ideal results of a project co-financed by the LuxAid Demonstration Fund will ultimately consist of:
  • A proven and cost-effective solution that delivers direct and measurable commercial, financial, social, and/or environmental results;
  • A strengthened business model ready to be accelerated/scaled, expand its impact on the target community and achieve commercial viability;
  • Mobilising other capital (ideally private) to enable the expansion of the solution within two years of the end of the project.

Geographical Focus

• The open call is looking for initiatives from businesses legally registered in Kosovo.

Eligibility Criteria

• You are eligible for LuxAid Demonstration Fund if:
  • Your enterprise is a formal commercial or cooperative company, legally registered in Kosovo before 1/11/2019 (sole proprietorships/individual businesses, associations and NGOs are not eligible – Please note that you will need to provide a business registration certificate, as well as articles of incorporation and tax clearance certificate);
  • Your enterprise can demonstrate having at least 5 individuals with legal employment contracts and a turnover below EUR 50 million. (Please note that you will need to provide copies of the contracts and financial statements);
  • Your enterprise has not obtained more than EUR 500.000 in external funding (grants, equity, loans etc.) within the three years preceding the submission deadline;
  • Your enterprise has a project proposal centred around an innovation in one of the thematic areas of the current call for proposals;
  • The innovative product/service proposed has been tested on the market and generated sales revenue for at least one year by the submission deadline, demonstrates clear commercial viability potential and has a clear scale-up plan to allow for significant SDG related impact;
  • Your enterprise can co-finance at least 50% of the total project costs via external investments, founders’ own funds, the enterprise’s own free cashflow available in the beginning of the project and/or sales.

Selection Criteria

• The selection committee for each of the two funds will prioritise systemic development solutions that target root causes rather than symptoms of structural problems. The Funds aim to strengthen innovative and inclusive economic models that act on the vicious circle of poverty/access to basic socio-economic goods and services.
  • Projects will be evaluated according to the following selection criteria:
    • Innovation and (cost) effectiveness;
    • Societal impact, scaling potential, and futureproof;
    • Project viability and financial sustainability;
    • Implementation capacity;
    • Additionality.

For more information, visit Luxembourg Development Cooperation.