IIA R&D Fund

IIA R&D Fund

Funds Israeli technology projects for corporations and startups through shared-cost research and targeted commercialization support.

The Israel Innovation Authority's R&D Fund is the country's principal non-dilutive technology funding mechanism, supporting Israeli corporations that are developing new products or upgrading existing technology across all sectors — from software and AI infrastructure to biotech, medtech, cleantech, semiconductors, and advanced manufacturing. The fund covers 20 to 50 percent of approved R&D expenditures, with the Israeli company self-funding the balance. Regional bonuses increase the funding rate by 10 percentage points for projects located in Israel's peripheral development zones and by 25 percentage points for projects in the Gaza Strip area. Minority population-owned, Ultra-Orthodox, and women-led startups receive preferential rates of up to 75 percent in the first year and 70 percent in the second year.

Individual award sizes range from approximately ILS 500,000 for small-firm projects to ILS 50M for large industrial R&D consortium programs, with a typical median around ILS 3M. The annual pool across the R&D Fund is estimated at approximately ILS 1.5B. Grants are conditional rather than traditional: repayment is required only if the project leads to commercial sales, at a royalty rate of 3 to 5 percent of revenues, capped at the total grant amount plus LIBOR interest. If commercialization fails entirely, no repayment is due. All registered Israeli for-profit corporations are eligible; nonprofits, universities, and individuals are excluded from this specific track. Eligible TRL range is 3 to 7.

Applications are reviewed on a rolling basis year-round by IIA's research committee — there are no fixed submission windows. Strong applications present a technically differentiated product concept, a credible development plan with defined milestones, and a clear market path. Founders previously funded through the IIA's early-stage Tnufa program frequently graduate into the R&D Fund as their next step. Companies operating in peripheral regions should emphasize regional location to maximize their funding rate.