readiness. Half of the firms were then randomized to treatment and half to control within each stratum<sup>2</sup> , resulting in 113 firms assigned to treatment and 112 firms assigned to control.

We collected baseline data from the application form and a diagnostic questionnaire carried out in October and November 2020. The baseline information offers key insights on the characteristics of the firms included in the sample, with summary statistics provided in Table 1. The selected firms are heterogeneous in sector. Just over one-third (36%) of firms are in the ICT sector, making customized software or providing information technology solutions for other businesses and consumers. Most of these firms are in customized software development. Examples include companies that develop mobile and web applications, e-commerce support, enterprise management software, cloud services, and other software consulting for other firms; companies providing digital marketing tools and support; supply-chain management; and helping firms to use new technologies such as virtual and augmented reality and 3D printing.<sup>3</sup> The second most common industry is manufacturing (24%), which covers a wide range of activities including making specialized metal products, specialized clothing (e.g. safety gear for factories, medical uniforms, fashion items), food products (e.g. traditional food shipped online, organic processed food products) and wooden products (e.g. handmade window frames and shutters, boats). Professional services accounts for 14 percent of firms, and includes digital marketing firms, legal consulting, health services, and energy consulting. Four to five percent of firms are each in retail, tourism, and education. 72 percent of firms are largely B2B firms, with firms in the ICT sector (94%) and professional services sector (90%) being particularly focused towards other businesses as customers, compared to firms in tourism (100%), education (100%), and retail (67%) being more focused on consumers as customers.

Specific examples of the types of innovative products and services these firms are offering include: a vibration-based system for preventative maintenance of machines, an online notary service with tools for signature verification, production of biodegradable packaging, cloud-based software for the energy sector, sensors to help detect when manhole covers are removed designed for telecom firms, solar-powered smart benches for bus stops, using biometric technology and artificial intelligence to improve marketing campaigns, and digital tools for vineyard management.

The firms are small and medium-sized enterprises, with a mean (median) size of 17.6 (8) workers, and median annual sales between 100,000 and 250,000 euros. Their founders have

> 2The three categories provided (location, digital product, and diagnostic score group) formed 18 strata. There were 214 firms who had answered the diagnostic questionnaire by December 2, and they were randomly assigned within these strata. A further 11 firms that were late in responding were then separately randomized with equal probability to treatment and control within a 19th stratum consisting of 10 of these stragglers, and then the final firm was randomly assigned to treatment as a singleton.

> 3These firms were not simply selling mass-market software to consumers through an app store, but rather developing customized tools for that often required considerable interaction with customers. For example, a firm selling digital tools for vineyard management would need to visit customers (wine producers) in person to help determine the system needed for them and to set it up

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