SBA can help innovators get started

Could yours be the perfect invention to aid U.S. combat soldiers in Iraq? Have you created a vaccine that could possibly rid the world of one of its deadly diseases? Do you think that you could possibly be the next Bill Gates?

By DANIEL HANNAHER

Perhaps your ideas or inventions are not as grand as these, but you need a little assistance with funding your idea and making your dream a reality. If the answer is yes, then the federal government may be able to help you.

For small businesses seeking to advance their technological inventions in the commercial marketplace, the U.S. Small Business Administration http://www.sba.gov/ administers the Small Business Innovation Research http://sbir.mt.gov/default.mcpx and the Small Business Technology Transfer programs. The SBIR program is a highly competitive three-phase award program that encourages small businesses to explore their technological potential and helps the profit from their inventions.

The SBIR program has helped thousands of small businesses to compete for federal research and development awards. Their contributions have enhanced the nation’s defense, protected our environment, advanced health care, and improved our ability to manage information and manipulate data.

By reserving a percentage of federal research and development funds for small businesses, the SBIR program protects small businesses and enables them to compete on the same level as larger companies. Every federal department or agency with an external research and development budget greater than $100 million participates in the SBIR program, including the U.S. Departments of Agriculture, Commerce, Defense, Education , Energy, Health and Human Services and Transportation, Homeland Security, the Environmental Protection Agency, National Aeronautics and Space Administration and National Science Foundation. Each agency is required to set aside no less than 2.5 percent of its overall external research and development budget to use either as an SBIR grant or contract.

These agencies issue requests for proposals for specific R&D projects they want accomplished, and accept unsolicited proposals for other projects. The SBA collects solicitation information from participating agencies and publishes it quarterly in a pre-solicitation announcement.

Following submission of proposals, agencies make SBIR awards based on small business qualification, degree of innovation, technical merit, and future market potential. Small businesses that receive awards or grants then begin a three-phase program.

Phase I is the startup phase. Awards of up to $100,000 for approximately 6 months support exploration of the technical merit or feasibility of an idea or technology. Phase II awards up to $750,000, for as many as two years, expand Phase I results. During this time, the R&D work is performed and the developer evaluates commercialization potential.

Only Phase I award winners are considered for Phase II. Phase III is the period during which Phase II innovation moves from the laboratory into the marketplace. No SBIR funds support this phase. The small business must find funding in the private sector or other non-SBIR federal agency funding.

A related program, STTR is coordinated by the SBA with other federal agencies spending $1 billion or more in extramural research and development, including the U.S. Department of Defense, Energy, and Health and Human Services, and the National Aeronautics and Space Administration and National Science Foundation.

Like the SBIR program, the STTR program is also a high technology-based three-phase award program. The STTR program encourages cooperative research and development projects conducted jointly by a small business STTR awardee and a research institution that is either a non-profit institution or a federally funded research and development center.

To learn more about the SBIR and STTR programs, visit SBA’s website at http://www.sba.gov.

Daniel Hannaher of Denver is regional administrator for the U.S. Small Business Administration. Montana biotech startups, including members of the Montana Biotechnology Alliance http://www.montanabio.org/ , have been remarkably successful in winning SBIR grants. Since 2008, Montana companies have received $20 million.

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