Design Foundations Evaluation Report: Early-stage design for innovation and business growth

To better understand the impact of the Design Foundations competition, Innovate UK commissioned Harlow Consulting to evaluate four cohorts of businesses supported between 2022 and 2024. The evaluation used a mix-methods approach to explore how funded businesses applied design practices during their early-stage innovation projects, and the extent to which this shaped their innovation capabilities and overall business performance.

How funding opens doors for early-stage design

Despite its importance to innovation and business growth, design remains underused by businesses at the earliest stages of the innovation process. SMEs, start-ups and pre-start-ups may lack the resources, knowledge and confidence to use design effectively at this critical time.

To address these entry barriers to design, the Design Foundations competition awarded grant funding of between £40,000 and £80,000 to help businesses collaborate with design experts and apply design in early-stage innovation projects lasting three to six months.

During the first four cohorts, 122 design projects were funded across twenty sectors, ranging from manufacturing, health, creative industries, to climate tech.
Businesses used these projects to:

• explore and better understand user and stakeholder needs,
• generate new or improved ideas based on real insights
• test and iterate concepts early through low-cost prototyping and feedback loops

Key insights: How design-led projects de-risk innovation and accelerate results

Businesses reported measurable and sustained benefits from this early-stage design support.

De-risking early innovation and accelerating later-stage activities

Design-led projects helped businesses make better decisions sooner:

• 92% reduced risks in their innovation processes
• 81% saved time later in development.
• 77% saved costs later in development.

Strengthening Innovation Capabilities

Businesses enhanced their ability to gather feedback, test market viability, identify the right innovation opportunities, adapt to change, and use social and environmental considerations to support and improve their commercial goals.

Delivering Tangible Results

Early-stage design translated ideas and concepts into quality outputs for businesses:

• Two-thirds improved existing products or developed new ones,
• Nearly half enhanced existing services or designed new ones,
• Three in four refined their business model and improved their market positioning

Commercial readiness:

Design projects helped businesses prepare for growth:

• 85% felt more confident seeking further investment,
• 36% secured follow-up investment during or shortly after the projects.

“Once businesses experienced design in practice, their use of design across innovation activities grew fivefold. Design shifted from being seen as a ‘nice-to-have’ or competing cost to a strategic, long-term investment that drives innovation and business growth.”

The independent evaluation provides further evidence of how early-stage design can be leveraged by businesses across sectors and contexts to build lasting capabilities, strengthening innovation activities, and drive business growth.

Building on these insights, The Design in Innovation team at Innovate UK Business Connect continues to explore how to best support businesses in applying design effectively and connecting with the right expertise to do so.

If you are interested in learning more about design in innovation, the full report is available below.