Frontier AI: SME Champions 2026, Phase 1 grants from Innovate UK

Frontier AI: SME Champions, Phase 1 is an Innovate UK competition with up to £3.1 million for feasibility studies. It is meant for UK small companies that work on state of the art AI and machine learning. Innovate UK defines frontier AI as systems that reach state of the art results on benchmarks or offer new to the world capabilities, through new model architecture, training methods, core learning algorithms or core control algorithms.

Each project must have total eligible costs between £150,000 and £250,000 and last one to three months. Projects must start by 1 April 2027 and end by 30 June 2027. The project should start at technology readiness level 1 to 3. By the end, teams deliver a proof of concept prototype, a validation method with set metrics, evidence of technical novelty, a scaling rationale and a technical white paper.

Only UK registered SMEs can apply, and they apply alone. Each SME can send one application, and subcontractors are not allowed. Proposals must fit one of four themes: AI for health and life sciences, advanced materials with AI, secure AI for national security, and AI safety and assurance technologies. Within the chosen theme, the project must focus on one listed priority.

Applications go through the Innovation Funding Service. The competition opened on 1 October 2026 and closes on 11 November 2026 at 11:00 UK time. A recording of the briefing event from 7 October is linked on the page. Applicants will hear back on 26 January 2027.

Innovate UK says it looks for ambitious ideas based on strong scientific evidence, with a clear route to protecting the work, such as owned IP or a data advantage. Each proposal must name a baseline with numeric targets and one key uncertainty the project will resolve. Innovate UK notes that similar competitions have had about a 2% success rate. This is Phase 1 of a three phase pipeline, and only Phase 1 winners can apply to Phase 2.

Quick answers

Is there funding after Phase 1?

Only successful Phase 1 applicants will be invited to Phase 2, which can fund demonstrators of up to 12 months with costs of up to £1 million. Phase 2 depends on UKRI business case approval.

How much of the project cost does the grant cover?

Up to 70% of eligible costs for micro and small companies and up to 60% for medium sized companies.

What kind of AI work is excluded?

Routine integration, deployment or productisation of existing AI tools or third party models without new AI or machine learning development is not funded.