Small Business Innovative Research Programs
Are you familiar with the SBIR Program? If not, think of federal agencies as eager investors with a mandate to develop new technologies. If you can find a topic that fits your expertise, you may be awarded the funds to develop it. To qualify for the SBIR program a for-profit business must have less than 500 employees, be U.S. based, and the chief researcher must be employed by the submitting business.
As directed by Congress, SBA’s Office of Technology “administers the Small Business Innovation Research (SBIR) Program and the Small Business Technology Transfer (STTR) Program.* Through these two competitive programs, SBA ensures that the nation’s small, high-tech, innovative businesses are a significant part of the federal government’s research and development efforts.” 
Each agency with SBIR funds publishes periodic lists of requested proposals. The topics vary widely—from digital gaming in education to new energy storage devices.
In addition, each agency has different rules about procurement and administration of SBIRs. For example, when lists of requested projects are announced, most agencies provide contacts for questions, while others preclude any contact at all. Be aware that each of the DoD’s components (Army, Navy etc.) have slightly different rules and procedures. Sometimes there are specific instructions for a particular topic, so you must study the solicitation instructions thoroughly. Some agencies also change their instructions from year to year. Most proposals are limited to 25 pages; you must learn to be really succinct.
I once did an SBIR submission for a company that always included colored line graphs to illustrate scientific points. The submission rules for that agency clearly stated that color was not acceptable because they would be copying the proposals in black and white for the evaluation team. These line graphs were meaningless in black and white. It was a huge chore for me to convince the scientists that color was not allowed. A small item like this can doom you to failure.
SBIR award amounts are from $100,000 to $150,000 for phase I, and $750,000 to $1,000,000 for phase II. This does not affect an agency’s right to make awards of greater or lesser amounts. $150K is not a lot of money to do basic research. Phase II is commercialization. More on that later.
Finding Information About SBIR Agency Programs
Two web sites offer the most information about SBIR programs. 
The first is the SBIR Gateway ( http://www.zyn.com/sbir/ ) which offers plethora of information, including a newsletter, news about the program and solicitations, event calendars, and agency links.
* STTR requires the small business to partner with organizations such as universities, contractor-operated federally funded research and development centers or other non-profit research institutions.
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Commercialization
Phase II of all SBIRs involves preliminary commercialization of the research results from phase I. After you have successfully completed phase I, you will be given an opportunity to submit for phase II. ( In phase III you turn your research into a commercial product. ) Your investor—the federal government—wants to know how you plan to market your results, and how it will make your business grow to create jobs. This aspect of the project has become one of the most important parts of your submittal. Often the sponsoring agency will assign a private firm to assist in the phase II proposal effort.
Many beginners submitting for an SBIR award make the mistake of concentrating on the research aspect of their idea and neglect the commercialization. This is always fatal because commercialization is one third of the score for your submittal. (The other two are feasibility of your research and qualifications of your research staff.)
Your commercialization plan must be specific and well-documented. Plans should include such things as market need and value, technology risks, market entry strategy, manufacturing plan and value chain analysis. This can be quite a challenge, but without a good plan there is no hope of winning an award.
For some great help go to “What’s Your Commercialization Plan?” at http://atdc.org/2010/03/whats-your-commercialization-plan.html
Getting Started
If you think that you might be interested in pursuing SBIR funding, there are some basic steps to help you get started. If you are willing to spend a little time learning about this program, you won’t need to attend a conference or find a consultant to help you. Federal agencies usually have at least one person whose job is to help small business get funds. And the predetermined topic lists mean that the research is needed. Your goal is to convince the evaluation team that you are the best company to do this research. Also, most agencies have sample proposals on their web sites to help small businesses learn to write a good proposal.
If you do some research about the history of your selected topic you will make a more informed go-no go decision and you will be ahead of others submitting on the topic. This means looking at closed topics and awards, and making calls to the topic author. Suggestions to help you do this are in the case study.
Often people with great ideas hear about the SBIR program and seek grants to fund their development. I once attended a two-day SBIR conference. Federal agency representatives presented their research needs for the coming year; they made it very clear that they were authorized to award funding for the pre-approved list of projects only. Oddly enough, most conference attendees did not seem to understand this. I sat at lunch with a quantity of very nice, probably bright, people who told me all about their project ideas and that they were going to present them in the one-on-one sessions with agency reps. They just didn’t want to hear that this was a waste of everyone’s time.
The bottom line is that, with a little research and preparation, the SBIR program can be a great step for your small business.
The steps for getting started are outlined in the case study—How to Submit a Proposal for SBIR Funding. I have included a few tips that only experienced SBIR submitters use. There is also a list of some helpful websites to help you get started.
Let me know how it works for you! Contact Me. cwilliams@intellhunt.com