The Small Business Innovation Research (SBIR) and Small business Technology Transfer Research (STTR) programs were established to lower the barrier for small businesses to fund the development of new technologies for the marketplace. The SBIR/STTR programs are only available to small businesses (< 500 employees) located in the U.S. Small businesses do not need to compete with large academic institutions, corporate R&D facilities, or Federally Funded Research and Development Centers (FFRDCs). Small businesses only compete with each other for funding which substantially improves the chances for a business to receive grant funding. Typically, about 15-20% of the SBIR grant submissions that are received are funded. Grant funding is non-dilutive; the granting agency takes no equity in the firm. The goal of this funding is to get a technology developed to a level that allows market infusion or that can attract investment to complete commercialization. The federal government funds the development of new technologies in the marketplace to provide new jobs, retain talent domestically, improve America’s global competitiveness, and overall increase global quality of life.
There are a total of eleven federal agencies that participate in the SBIR program:
- The Department of Defense [DoD]
- Health and Human Services [HHS] (This includes the National Institutes of Health [NIH], the Food and Drug Administration [FDA], and the Centers for Disease Control [CDC])
- The Department of Energy [DOE]
- The National Science Foundation [NSF]
- The Department of Education [DoE]
- The National Aeronautics and Space Administration [NASA]
- The Department of Transportation [DOT]
- The Department of Homeland Security [DHS]
- The Department of Agriculture [USDA]
- The Department of Commerce [DOC] (This includes the National Institutes of Science and Technology [NIST] and the National Ocean and Atmospheric Administration [NOAA])
- The Environmental Protection Agency [EPA]
Of these, five agencies also participate in the STTR program:
- The DoD
- The DOE
- HHS
- NSF
- NASA
The SBIR and STTR programs have different requirements. For an SBIR project, at least two-thirds of the work must be conducted by the Small Business Concern (SBC). This allows some flexibility for an SBC to contract with a third party to conduct work that cannot be done internally, but the bulk of the work must be done by the SBC personnel and at the SBC location. For an STTR, a minimum of 30% of the work must be done by the SBC and a minimum of 40% of the work must be one by an academic partner. This program allows for the translation of technologies from the academic bench to the commercial marketplace, but it also allows for teams to form that leverage the complementary talents and expertise of the academic and SBC partners.
Although the size standard for an SBC is <500 employees, you do not need to have a large enterprise to successfully compete for an SBIR or STTR grant. Many companies of only 2-3 employees have successfully won grants which have provided the foundation for continued growth and stability. The most important parts for a compelling proposal include:
1) A novel solution to an existing problem that does not currently exist in the marketplace
2) A technology that is innovative in the context of the current state-of-the-art
3) A detailed research and development plan to commercialize the technology
4) The expertise to perform the research and development work America’s SBIR/STTR program is the bedrock for the development of new technologies and new businesses.
If you are interested in the program and if your technology would be a good fit, reach out to set up a meeting with SciNcite.