Q1: Do I have to be located in Arizona to apply to the Innovation Challenge?
Answer: No. While the vast majority of companies that apply are Arizona firms, it is possible to be located outside of Arizona when you apply, as long as you plan to relocate or build operations in Arizona, including commercializing your products/services here within the 12-month award period. Read more.
Q2: How large are the grant awards for the Challenge?
Answer: All AIC grants are up to $150,000 per company. The AIC recognizes 10 awardees per year, distributing $1.5 million in non-dilutive capital to Arizona’s emerging companies.
Q3: Does my company need to be within certain industry sectors to qualify for the Challenge?
Answer: Yes. The AIC application specifies certain industries that applicants may operate in. These categories include:
- Advanced manufacturing
- Advanced materials
- Aerospace and defense
- Bio and life science
- Clean-tech and renewables
- IT – Hardware
- IT – Software
Traditionally, retail, real estate, and professional services companies do not qualify for the AIC unless their product or service involves a unique technological solution.
Q4: Are there limitations on what the grant awards may be used for by the winning companies?
Yes. Funds awarded through the Arizona Innovation Challenge and disbursed through Venture Ready are subject to specific uses. Generally, AIC awardees must use their grant funds to advance commercialization objectives. In this pursuit, awardees may use funds for activities such as standing up strategic initiatives, hiring key employees, expanding sales and marketing efforts, or refining a company’s financial model. Awardees may not use grant funds for certain administrative and overhead expenses, nor may they be used to compensate existing employees and executives. Specific negotiations will occur between the ACA and each AIC awardee to determine the milestones to release funds to AIC awardees.
Q5: Does an AIC winning company have obligations to the ACA beyond receiving the grant funds?
Answer: Yes. Each AIC awardee will sign a legal agreement with the ACA that will obligate the company to various terms of compliance for five years from the date of execution. Companies will be obligated to report the achievement of key business metrics, allow onsite visits by ACA personnel, and supply key documents to the ACA for review as requested. Additionally, the legal agreement between the ACA and AIC awardees will include clawback provisions meant to dissuade companies from taking actions that would harm Arizona’s innovation ecosystem. Such activities include, but are not limited to, moving a company’s operations outside of the state, being acquired by a company who moves the awardee’s operations out of the state, or violating reporting obligations and requirements.