Newsletter
Historically, the administrative complexity of European R&D programmes has limited the participation of key actors such as farmers, cooperatives, and start-ups—whose involvement is essential to validate innovations in the agri-food sector.
To overcome this barrier, the European Commission promotes Financial Support to Third Parties (FSTP), also known as Cascade Funding. This mechanism allows project consortia to award small grants to external entities through agile and streamlined open calls.
In Horizon Europe Cluster 6, particularly within the 2026 topics, this tool is becoming a strategic pathway to democratise access to funding.
At INNOVARUM, we have advocated for this approach for years. At INNOVARUM, we have advocated for this approach for years; in fact, in a 2019 study conducted for the European Commission and BBI-JU, we already recommended these small grants as the ideal solution for integrating those who are often left out of large consortia into the innovation ecosystem.
Why is FSTP a useful tool?
FSTP is not just an additional funding mechanism—it is also a way to increase the reach and impact of European projects.
Involving key innovation actors
FSTP enables the participation of actors who typically do not join projects as consortium partners, such as:
- farmers
- cooperatives
- tech start-ups
- agri-food SMEs
- individual entrepreneurs
These actors bring practical knowledge, experimentation capacity, and access to real-world environments where solutions can be validated.
Administrative simplicity
The system is designed to be significantly simpler than participating as a project beneficiary.
Funding is usually provided as lump sums, meaning beneficiaries do not need to provide detailed financial justification for every expense. Payments are released once the agreed technical activities have been successfully completed.
Expanding project reach
FSTP also allows projects to extend their geographical and sectoral reach by incorporating new actors during project implementation through open calls.
What kind of activities can third parties perform?
Typically, the topic description includes examples of activities that can be funded via FSTP. While these are not usually exhaustive, the consortium can design tasks to maximise project impact. Common examples include:
- Farmers and Cooperatives: Conducting on-farm testing of innovations, trying new varieties, or implementing agroecological practices in real conditions.
- Start-ups or Tech Companies: Demonstrating digital solutions, sensors, or management tools in pilot environments linked to the project.
- Agri-food SMEs: Experimenting with new ingredients, processes, or products derived from project results.
- Entrepreneurs: Validating business models or testing new solutions in collaboration with industry companies.
What level of funding can be offered?
The maximum amount per entity is typically indicated in the topic description and, in many cases, is around €60,000 per beneficiary.
However, the design of the open call remains flexible.
In some projects, it may be beneficial to allow joint proposals between multiple entities, for example, small consortia of two or three organisations. This approach can support more ambitious pilots or larger-scale testing activities.
What needs to be prepared in the proposal?
If you plan to include FSTP, your proposal must contain a specific annex describing how the mechanism will be implemented.
You can download the template from the Funding & Tenders Portal to ensure you are using the most recent version.
This annex must describe how this part of the budget will be implemented, including:
- the design of the open calls to be launched
- the evaluation and selection criteria
- the number of entities to be funded
- the timeline of the calls
- the payment and monitoring system
Although sometimes treated as a secondary element of the proposal, this section is actually an important part of the evaluation. It demonstrates that the consortium has a clear plan to involve new actors and maximise project impact.
For this reason, it is advisable to start working on this section well in advance.
A recommendation from experience
If the topic allows the use of FSTP, our recommendation is simple: use it.
When properly designed, this mechanism can significantly strengthen the Excellence and Impact sections of a Horizon Europe proposal while connecting the project with the real-world actors who will ultimately apply the solutions developed.
If you have questions about designing an FSTP scheme, structuring open calls, or integrating them into your Horizon Europe proposal, feel free to contact us.
At INNOVARUM, we have years of experience working with this instrument and can help you make the most of it.
Useful resource
European Commission – Guidance on Financial Support to Third Parties (FSTP)
https://ec.europa.eu/info/funding-tenders/opportunities/docs/2021-2027/common/guidance/guidance_fstp-good-practices_en.pdf