Technology Commercialization

SBIR Grants & Proposal Tips

Looking for "proof-of-concept" funding?

Small Business Innovation Research (SBIR) is a federal government program administered by the Small Business Administration that awards funds to small businessesSBA for exploring the technological potential of an idea and its potential for successful commercialization. It furthermore encourages participation of socially and economically disadvantaged individuals in the arena of innovation and entrepreneurship. Each year, Federal agencies with extramural R&D budgets that exceed $100 million are required to allocate 2.8% of their R&D budget to these programs.

Department of Defense (DoD)
Among the agencies that have anUS-Defense-Department-Logo interest in technology-based innovations, and that also have a significant SBIR budget, is the DoD. Among the most active DoD funding agencies are the Defense Advanced Research Projects Agency (DARPA), and the U.S. Army Medical Research & Materiel Command (MRMC), which offers health science-related SBIR grant opportunities. A very useful search engine is located at this DoD Small Business Portal, which facilitates the identification of SBIR/STTR funding opportunities throughout the DoD.

Department of Energy (DoE)DoE
The DoE is another agency that provides, through their SBIR program, significant financial support for research and development in areas of basic science and engineering, with particularly interest in the areas of clean energy and nuclear security. DoE Funding Opportunity Announcements for 2015 will be found here beginning July 20, 2015.

National Institutes of Health (NIH)
Within the field of medical technologies, nih-logo-blueall branches of the NIH (e.g., NCI, NHLBI, NIAID, etc.) and many other agencies within the Department of Health and Human Services also offer SBIR programs. Current and forthcoming solicitations in the health science fields are found at this NIH website where you can also get specific instructions on preparing your proposal and avoiding common submission errors.

Each agency publishes at least once per year a solicitation with a detailed description of the topics and subtopics of interest. It is important to pay attention to the need that is being described in each topic, and to focus your proposal on addressing such need. In some instances, the description of a problem may even indicate a preferred approach based on existing technologies’ shortcomings. The deadline for submission of proposals varies among agencies, and may even be a floating schedule. Therefore, it is advisable to periodically visit each agency’s website to keep track of the opening and closing of solicitations.

Another way of learning about SBIR/STTR opportunities and making direct contact with the program managers of the various agencies is to attend the National SBIR/STTR Conferences, which are offered at different cities across the U.S.. These conferences often offer information on how to create and submit proposals, post notices on specific areas of opportunities, and provide networking opportunities with other experienced entrepreneurs in similar fields. For the schedules and location of the upcoming SBIR conferences, see here.

How much $ is potentially available?

The SBIR program divides the awards into three phases, of which only the first two are funded by the agencies:

  • Phase I
    Provides awards for proof-of-concept work in regard to both technology and commercialization potential. During this phase an awardee also demonstrates the capability to perform as a small business entity. The award “guideline” amount is up to $150,000 and the goals of the proposal are expected to be achievable within six to nine months from funding.  As of 2015, agencies have the flexibility to increase awards up to 50% above SBA guidelines (up to $225,000) for subjects of special interest, and may also seek an SBA waiver for even higher awards.
  • Phase II
    Awards are based on the achievement of phase I work and a well-preparedMashable.com $ Phase II proposal that describes a realistic product development and commercialization plan. The award “guideline” amount is up to $1,000,000 and covers a two-year period of performance. As stated above, this amount can potentially be increased to $1,500,000 for topics of special interest, and beyond that with an SBA waiver.
  • Phase III
    The government agencies with SBIR programs provide funding for Phase I and II, and most offer various opportunities for further support through a Phase III program, which could provide assistance toward technology licensing, supply contracts or additional (non-SBIR) R&D funding.Visit this site for an NIH review of key changes implemented in the 2015 SBIR program.

Can a university researcher be the Principal Investigator?

If you are a faculty member or researcher within a university or research institute and are considering the formation of a company for the purpose of an SBIR proposal submission...


You should be aware of the SBIR program requirement that the Principal Investigator’s (PI) primary employment must be with the “Small Business Concern ” (SBC) that is identified in the proposal.

If your intention is to maintain your current employment status, you will need to recruit a co-founder who will commit at least 51% of their time as an employee of the SBC and who would serve as the PI, should the grant be awarded.

Under SBIR regulations, collaboration between the SBC and a research institution is encouraged, but is not required.

Small Business Tech Transfer (STTR)
This program does require collaboration between a SBC and a non-profit research institution, such as a university or federally-funded R&D center. Under this funding mechanism, not less than 40% of the work must be performed by the SBC, and not less than 30% of the work must be performed by the non-profit research institution.

For more general information on SBIR/STTR programs and participating agencies visit here.

What are other important requirements for SBIR participation?

For each of the phases of SBIR-funded work, there are requirements that must be met, such as the minimum amount of direct participation by the awardee, citizenship requirements, maximum number of employees, etc. The PI is expected to have expertise in the field of application, though not necessarily possess a Ph.D. or M.D. degree.

Regarding company formation status for SBIR eligibility, SBA states "You do not have to certify eligibility until the time of award" ...


In reality, however, recent changes to the Grants.gov electronic SBIR application form requires you provide a DUNS# (i.e., evidence of incorporation) in order to process the grant application.

All DOD participation requirements should be carefully reviewed, and can be found in this DOD SBIR website.

The U.S. Army Research, Development, and Engineering Command (RDECOM) is responsible for execution of the Army SBIR Program. Information on the Army SBIR Program can be found here.

What are the key elements of a successful SBIR Phase I proposal?

SBIR Proposal “Tips”
Each agency has a different history regarding the percentage of their submitted proposals that receive funding. For some guidance, however, only about 30% of Phase I SBIR proposals submitted to the NIH are recommended by individual reviewers for subsequent serious discussion and consideration by an expanded group within a particular NIH study section. So, even though this statistic may not apply to all SBIR programs, you might improve your chances for making this first cut by reviewing the following suggestions:

Be responsive to the topic ─ or it will not be reviewed!
As a starting point, you should review the SBIR solicitation very thoroughly to understand exactly what is being requested. Be certain the project is in alignment with the overall mission of your business, and make sure your proposal is responsive to the topic, or it will not be reviewed.

SBIR applicants are expected to know the state-of-the-art in the field they are pursuing...


Failures to describe the relevant art, or from an intellectual property perspective to cite prior art, are common reasons for rejection of SBIR proposals!

Proposal reviewers will be volunteers who are generally academics with expertise in particular fields of study, so if you do not have a strong background in the area of your pursuit, you should conduct adequate homework before and during the proposal period that would include acquiring knowledge of the current literature and related prior successful proposals.

Clear description of problem – demonstrate insight, with innovative solution
Assuming your proposal clearly addresses a topic under a particular solicitation, the next most important criteria for getting past the first review is the insight you demonstrate in the description of the problem, along with the degree of innovation described in your proposed solution.

Proposals involving incremental technological improvement (in areas of high interest) will occasionally be awarded...


Generally, however, you will need to describe concepts that have the potential to solve significant problems.

You will also need to express clearly what makes your device or approach different and superior to other approaches. Accordingly, you should conduct a literature and patent search, and demonstrate knowledge of your proposed product’s technological position within the field of application, as well as your confidence that there are no obvious IP blockages.If you have not filed at least a provisional patent application around your technology, be careful not to disclose your invention. SBIR proposals are supposed to be held in confidence, but you should not take an unnecessary chance in this regard. Any prior technology or information developed by the Small Business Concern outside of the solicitation process, but considered essential to the proposal, should be marked clearly during the application process to distinguish it from IP generated during the SBIR-funded work.

Strong team with knowledge of proof-of-concept requirements
The mission of Phase I SBIR programs is to provide funding for the demonstration of proof-of-concept. Proposals do not require even preliminary data, but of course data does get attention and can add to the competitiveness of your proposal.

If you do not have data to submit...


It will be even more important that you clearly and convincingly describe a research plan that includes experiments designed to demonstrate product feasibility.

And remember, you will only have six (potentially extended to ten) months in which to demonstrate this milestone, so be reasonably certain that your plan is realistic.

Although a “commercialization plan” is not a requirement for submission in Phase I, communicating in the proposal some knowledge of the potential commercialization path for your technology will add to its attraction. In general, the expertise you assemble in your research team (clinicians, scientists, engineers) will have significant impact on the Topic Author’s perception of your overall proposal. If you think your team may be deficient in a particular area, seek the services of an experienced consultant that will add credibility to your team and your proposal.

Take advantage of access to Topic Author (TA)
During the solicitation period, communication with the TA is highly encouraged. During the Pre-Release period, you may talk directly with a TA to ask technical questions and seek clarification about the topics. The contact information for the TA is listed within each solicitation topic.

For reasons of competitive fairness...


Direct communication with a TA is not allowed during the Open Period when an agency is accepting proposals for each solicitation.

However, proposers may still submit written questions about solicitation topics through the SBIR/STTR Interactive Topic Information System (SITIS). In SITIS, the questioner and respondent are anonymous and all questions and answers are posted electronically for general viewing until the solicitation closes.

All proposers are advised to monitor SITIS during the Open solicitation period for questions and answers and other significant information relevant to their SBIR/STTR topics of interest.

Take advantage of format and submission guidance
Make sure you follow the format and guidelines for submitting your proposal. Each agency has a description of how this is to be done. When in doubt, feel free to contact the agency’s program manager to get clarification.

Each federal agency provides general guidelines and tips for the preparation of an SBIR proposal. The following example, specific to the health sciences, can be found at this NIH (NIAID) website.

Can I submit a proposal to more than one agency?

It is allowable to submit the same proposal to more than one agency; but only one award can be accepted.

At this time, some agencies—including NIH— allow one time only re-submission of a proposal that did not get funding in a previous submission. Such re-submission of the amended proposal shall include an introduction addressing the comments from the original reviewers. After a proposal fails twice to receive funding, it can only be submitted if it has been modified fundamentally — such that it qualifies as new.

As indicated above, even if your proposal does not get funding for a given submission, you will still get a written summary of the reviewer’s comments. This will help you improve your proposal writing skills for future submissions.

Do not wait for the last minute to submit your proposal...


It is common to have bottlenecks and even electronic transmission disruptions in the last hours of the submission deadline.

Results of a proposal’s evaluation are provided generally within 6 months of closing the solicitation, though it may be more in some instances.

What is the emphasis of Phase II SBIR proposals?

The focal point for Phase II awards consideration is the Commercialization orimg-header-market-knowledge Business Plan that you would prepare and submit as part of your funding application. The plan would include a study of the competition, market analysis, an evaluation of any hurdles to overcome for the adoption of the proposed technology, as well as plans for protecting the small business concern’s intellectual property. For more information on the preparation of a business plan, visit Business Model & Plan Development.

Commercialization assistance available during/after Phase II?

Commercialization-related assistance programs are often available within certain Department of Defense and NIH SBIR programs that provide “leverage” for their Phase II funding. These programs generally provide assistance to Phase II awardees with regard to business plan development and preparation for fundraising. They may also include investor presentation coaching, and culminate with invitations to a Technology Showcase, which may be planned as the “graduation” event for the assistance program, and which gives the awardees access to individuals from the private sector investment community.

Check with the SBIR Program Manager to see if the agency in which you are interested provides a Phase II commercialization assistance program.

About The Proof of Concept Institute, Inc.

The Proof of Concept Institute, Inc. is a California 501(c) (3) non-profit corporation, whose mission is to develop educational materials and programs for research scientists, clinicians, and engineers that will facilitate more efficient transfer of public-funded (university and federal laboratory) technology and intellectual property to the private sector, where products and services can be developed for the common good and to support U.S. global competitiveness.

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