---
title: "Switzerland: Innosuisse and Seed Strategy | DM & Associates"
description: "Strategy for Swiss seed founders: why the federal contribution goes to the research partner, the pre-market gate, and the deduction that cannot create a loss."
url: "https://dmassociates.xyz/regions/switzerland/"
---

Where we work · Switzerland

# In Switzerland the federal money usually goes to somebody other than the company.

In the standard innovation project the federal contribution is paid to the research partner, and the company pays in — between 40% and 60% of total project costs, plus a cash contribution on top. There is one route that pays the company directly, and it closes the moment the company reaches the market. We work with Swiss founders remotely from Hyderabad, in English, with no office and no company registered in Switzerland.

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Switzerland in six numbers

## Co-funding, not funding — with one exception.

1. 40–60%
  
  The share of total project costs an implementing company bears itself in a standard innovation project. The federal contribution goes to the research partner, not to the company. [Innosuisse FAQ](https://www.innosuisse.admin.ch/en/frequently-asked-questions)
2. 5%
  
  The minimum cash contribution the company must pay the research partner, counted inside its own share and spent on the partner's personnel and material costs. [Innosuisse FAQ](https://www.innosuisse.admin.ch/en/frequently-asked-questions)
3. 70% / 30%
  
  On the one route that funds the company directly: up to 70% of direct project costs, with the start-up paying at least 30% and having to show it can finance that. [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects)
4. Sixteen weeks
  
  About how long the process takes. Submissions are rolling, but must be in at least eight weeks before a council meeting — and meeting that deadline does not guarantee being heard at it. [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects)
5. 50%
  
  The maximum additional research deduction a canton may allow, on application. It is the canton's option, not a federal entitlement, and the qualifying base is domestic personnel costs plus a 35% uplift, or 80% of third-party invoices. [StHG (SR 642.14), Arts. 25a–25b](https://www.fedlex.admin.ch/eli/cc/1991/1256_1256_1256/en)
6. 70%, and no loss
  
  Total relief may not exceed 70% of taxable profit before loss offset, cantons may set less, and no loss carryforward may result from it at all. [StHG (SR 642.14), Arts. 25a–25b](https://www.fedlex.admin.ch/eli/cc/1991/1256_1256_1256/en)

That last figure is the one to plan around, and it is the opposite of the position in Norway, Sweden, France and the United Kingdom. All four of those turn a research incentive into cash for a company with no profits. Here the deduction works against profit, is capped as a share of it, and is barred from creating a loss to carry forward. For a pre-revenue company it is worth nothing, and it does not become a stored asset either.

Who gets paid

## Two instruments, and only one of them sends money to the company.

| Route | Who receives the federal contribution | What the company has to be |
| --- | --- | --- |
| **With an implementation partner.** The standard route. Federal contributions are paid to the research partners rather than to the participating companies. [Innosuisse FAQ](https://www.innosuisse.admin.ch/en/frequently-asked-questions) | The research institution. The company bears 40–60% of total project costs and pays at least 5% of total cost in cash towards the partner's own personnel and materials. [Innosuisse FAQ](https://www.innosuisse.admin.ch/en/frequently-asked-questions) | Any company, SME, start-up or other private or public institution that creates value in Switzerland, can bear its share, and has a willing Swiss research partner independent of it in financing and personnel. [Innosuisse, projects with an implementation partner](https://www.innosuisse.admin.ch/en/innovation-project-with-implementation-partner) |
| **Start-up innovation projects.** The exception. A research partner is neither necessary nor supported as a direct recipient. [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects) | The company, at up to 70% of direct project costs, with the remaining 30% its own and demonstrably financed. [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects) | Not yet on the market — prototypes or test installations at customers still count as before market entry. Under five years old at submission, ten in exceptional cases, fewer than fifty full-time equivalents, headquartered in Switzerland and on the commercial register. [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects) |
| **The accelerator for companies already selling.** When it ran: up to 70% of eligible project costs and a maximum of CHF 2.5 million per application. [Innosuisse, Swiss Accelerator](https://www.innosuisse.admin.ch/en/swiss-accelerator-innovation-projects) | The company, with 30% borne itself. [Innosuisse, Swiss Accelerator](https://www.innosuisse.admin.ch/en/swiss-accelerator-innovation-projects) | Not applicable today. The submission is closed and the agency says no call is currently planned, pointing companies to the European accelerator instead. [Innosuisse, Swiss Accelerator](https://www.innosuisse.admin.ch/en/swiss-accelerator-innovation-projects) |

The gate

## First revenue closes the one door that pays you.

- The start-up route requires the company not yet to be on the market.
  
  That is a condition, not a preference, and it is the only Innosuisse route that pays the company directly.
  
  [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects)
- The route above it is shut.
  
  The accelerator for companies already selling is closed with no call planned, and the published alternative is a European programme rather than a Swiss one.
  
  [Innosuisse, Swiss Accelerator](https://www.innosuisse.admin.ch/en/swiss-accelerator-innovation-projects)
- So the Swiss ladder has a gap, and it is at the opposite end from Norway's.
  
  Norway removed its bottom rung and kept the top one. Switzerland has the pre-market rung and the rung above it is currently closed.
- Which makes a commercial milestone a funding decision too.
  
  Reaching the market is what a seed company is for. In Switzerland it also ends eligibility for the one domestic instrument that sends cash to the company, and the plan should know that before the first invoice rather than after it.
- And the European route is open again.
  
  The EU Programmes Agreement was signed on 10 November 2025 and applies with immediate effect, associating Switzerland to the European research programme retroactively from 1 January 2025. For calls from the 2025 programme year a Swiss partner applies as a beneficiary and, in the department’s own words, project funding is provided from the European Commission — where before it came domestically. Projects from the 2021–2024 calls are unaffected and stay on the domestic instruments.
  
  [SERI, Horizon package 2021–2027](https://www.sbfi.admin.ch/en/horizon-package-2021-2027)

Sixteen weeks, eight weeks of lead time, and no guarantee of being heard at the meeting you made the deadline for. A runway plan that treats the domestic agency as available on demand is out by a quarter, and that matters more here than the percentages do.

Founders

## Where Swiss seed companies get stuck.

| Problem | What it looks like | What we work on |
| --- | --- | --- |
| A grant modelled as income | A budget shows the federal contribution arriving in the company's account. In the standard route it never does: it goes to the research partner, and the company is a net payer into the project. | Rebuilding the project budget around who actually receives what, so the cash line matches the instrument rather than the headline. |
| Revenue taken before the application | A first paying customer closes the only route that funds the company directly, with the route above it shut. The commercial win and the funding loss land in the same month. | Sequencing the first sale against the application window, and deciding deliberately which one comes first rather than letting the calendar decide. |
| A tax deduction counted too early | A plan books value from the additional research deduction while the company is loss-making. The statute caps relief as a share of taxable profit and forbids a carryforward arising from it, so there is nothing to book. | Treating it as a profitability-stage instrument and planning the first year on the funding routes that are actually open. |
| Assuming the deduction exists where you are | The additional deduction is each canton's option, granted on application, and a canton may set a lower relief limit than the federal maximum. A plan built on the federal headline can be built on something the company's own canton has not adopted. | Establishing the canton's actual position with your own adviser before it is in the model. We could not find an official list of which cantons have adopted it, so we name none. |

Sources: [Innosuisse FAQ](https://www.innosuisse.admin.ch/en/frequently-asked-questions) · [Innosuisse, start-up innovation projects](https://www.innosuisse.admin.ch/en/start-up-innovation-projects) · [StHG (SR 642.14), Arts. 25a–25b](https://www.fedlex.admin.ch/eli/cc/1991/1256_1256_1256/en)

Working with us from Switzerland

## Hours, language, tax and data.

- **Hours** — India is 3.5 hours ahead of Switzerland in summer and 4.5 hours ahead in winter. A 09:00 Zurich start is early afternoon in Hyderabad.
- **Language** — English. Switzerland has four national languages and its startup sector works in English; we do not draft in German, French or Italian. The statutory terms we quote are German, because that is the language of the federal text we read.
- **VAT** — Switzerland is outside the EU and outside the EU VAT area, so the EU reverse charge does not apply; it reaches a comparable result by its own route for services bought from abroad. We do not advise on tax and we quote no rate or threshold here. Your adviser confirms the treatment.
- **Data** — Switzerland is outside the EU and the EEA and has its own data protection statute rather than sitting inside the European regime. We act as a data processor under a written agreement, and founders' work in Founder OS is stored in the EU. Your lawyer confirms what the transfer position requires.
- **Invoices** — In CHF or EUR, from our Indian company.
- **Presence** — None. No office, no local company, no staff in the country.

Questions

## Partners, cantons and the things we do not do.

So we get nothing from a standard innovation project?

You get a subsidised research partner and the capacity that comes with it, which can be worth a great deal. What you do not get is the federal contribution in your own account, and a budget that shows it arriving has mis-modelled the instrument rather than mis-estimated it.

Which cantons offer the additional research deduction?

We do not publish a list, because we could not find an official one. Commercial tax guides name cantons and disagree with each other. The federal statute makes it each canton's option, granted on application, and your own adviser can confirm where you are.

Can you prepare an Innosuisse application?

No. We work on the commercial case underneath — who buys, at what price, and what a project has to prove to become a purchase. We do not prepare or submit applications, and the funding decisions belong to the agency. We make no promises about them.

Is the Swiss accelerator coming back?

The agency says no call is currently planned, and we have found nothing beyond that either way. We will say so until a page says otherwise.

Do you advise on Swiss tax?

No. We are not tax advisers and we are not registered to give tax advice in Switzerland or anywhere else. We flag that the additional deduction cannot create a loss carryforward because it changes when the instrument is worth anything; your adviser prices it and files.

Do you have an office in Switzerland?

No. We work with Swiss founders remotely from Hyderabad, in English, and we would rather say that than imply a local presence we do not have.

Figures on this page were last checked on 20 October 2026 .

## Start with who actually receives the money.

A 45-minute call with Dineshwara, scheduled in Zurich time.

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