Kittat, a consignment service for second hand children’s clothing has announced that they have received a 300,000 SEK grant from Vinnova to grow their start-up based in Stockholm. The concept behind consignment is essentially a two-sided marketplace (for example like eBay) but rather than letting users sell items directly, the company takes those items in batches, does all the work photographing and merchandising them, and then sells them on the users behalf.
The childrens clothing consignment space is certainly not unchartered territory outside of Sweden, many players in the US dominate such as as Twice or Threadup for example, but Annelie Näs, founder of Kittat believes there is room take a hold of the market here in Sweden.
The grant funding was provided by Vinnova’s Vinn Nu grant which is focused specifically on early stage start-ups. Along side Kittat others that also were accepted included Spontano, Codarica and 30minMBA (see the full list). Vinnova aim to fund around 20 startups with Vinn Nu each batch (this time 15 were funded) and get around 300+ applications, a pretty decent acceptance rate if you ask me given that funding is purely in grant form so founders do not need to give up any precious equity at all.
Grant funding can be somewhat of a daunting process for many start-ups, typically it requires some time to prepare documentation and planning, I quizzed Annelie on tips she could offer to other start-ups looking to go through this process:
“The process will take some time, but it all depends on how much you have “written down” from before. However, I would say that even if we wouldn’t have received the grant we still would have benefited from doing the work. As a start-up it’s easy to run with what you’re doing without thinking too much about it. The application process will have you stop and think things through and maybe change a thing or two. Take the time necessary to write a good proposal, don’t do it last second. Make sure you have a clear idea on exactly what you want to use the money for and specify that. Have a few other people read it and make sure they understand what you’re trying to accomplish.”
At the moment the Vinn Nu grants are on hold pending a revamp, which I’m pleased to hear will involve them making it even easier for start-ups to apply. Maria Kaaman from Vinnova tells me:
“We want all small companies, young or old, to be able to apply in an even simpler way. If we want to continue to have development and growth in Sweden then we must help in the startup sector.”
Rumour is that the Vinn Nu will reopen in a new but similar form accepting applications again, but in the mean time another of their programs, Forska&Väx, is open for startups looking to carry out feasibility studies (the deadline for proposals closes on 15th September, 2014).
Post your thoughts and feedback in the comments if you have had any experiences (good or bad) with grant funding…