A&D Conf Breakout Session #2

1 © Copyright 2003-2012. EnableVentures, Inc.

You envision . . . we enable.™

EnableVentures, Inc.

Breakout Session #2

Overview of the SBIR and STTR Programs

by

Sharon C. Ballard, President/CEO EnableVentures, Inc.

Phoenix Convention Center

January 26, 2012

“You envision . . . we enable.”™


Innovation, US economy and small business

S Small businesses create most new jobs

B Business ideas validated, business practices

imposed

I High risk/high payoff innovations, globally

successful new products

R Research and development by our nation’s

brain trust


Agencies in SBIR Program

• Department of Agriculture (USDA)

• Department of Commerce (DOC)

• Department of Defense (DoD)

• Department of Education (DoED)

• Department of Energy (DOE)

• Department of Health and Human Services (HHS)

• Department of Transportation (DOT)

• Environmental Protection Agency (EPA)

• National Aeronautics & Space Admin (NASA)

• National Science Foundation (NSF)

• Department of Homeland Security


Small business requirements

• For-profit U.S. business

• 51% U.S.-owned and independently operated

– NIH, DoE, NSF (25% of budget exceptions)

– All other agencies (15% of budget exception)

• Small business located in the U.S.

• 500 or fewer employees

• P.I.’s primary employment with small business during project (SBIR)


SBIR Program phases

• Phase I Feasibility study (funded proposal effort) $150K, 6 months

• Phase II

Research, Research and Development 2-Years, $1M

• Phase III

Commercialization stage Funding from non-SBIR Program funds


What is the Small Business Technology Transfer (STTR) Program?

• Team small businesses with research institutions

• Similar to SBIR Program

• Requires partnership with research institution

– Universities, federal labs, private research institutes

• Small Business: > 40% of Work

• Research Institute: > 30% of Work

• Only 5 Agencies: DoD, DoE, HHS, NASA, NSF

• .3% (2011) to .45% (2016)


STTR Program phases

• Phase I Feasibility study (funded proposal effort) $150K, 12 months

• Phase II

Research, Research and Development 2-Years, $1M

• Phase III

Commercialization stage Funding from non-SBIR Program funds


SBIR vs. STTR Program comparison

SBIR STTR

Set-Aside Budget (2009) 2.5% 0.3%

$2.315B $131M

Award Guidelines

Phase I $150K, 6 mos $100K, 12 mos

Phase II $1M, 18-24 mos $1M, 24 mos

Subcontracts

Phase I <33% <60%

Phase II <50% <60%

Academic/Lab Component

Not Required >30%

Business Employment of PI

>50% n/a


75.6M All Others: HSA, EPA, DOC, DOT, USDA, DOEd

155M DOE

127M NASA

110M NSF

672M NIH

1.36B DOD

Agency SBIR/STTR budgets - 2009


Agency differences

DOT NIH-Contracts

DHS NASA

DOC

EPA

DOD DOE

NSF

Narrow Topics Broad Topics

Contracts

Grants NIH-Grants

USDA

DoED


Schedule of SBIR/STTR solicitations

• Each agency = own schedule

• Schedules change each year

• Different schedules for SBIR and STTR

• Some = one solicitation; others = multiple solicitations

• Some have multiple submission dates with one annual solicitation

• Check each agency’s website


Topics & solicitations

• Topics selected by agency

– You can contribute a topic idea!

• Proposals must be responsive to a topic

or they will be screened out (no

technical review)

• Topic lists published by each agency in its

solicitation (Request for Proposals)

• Most agencies publish one solicitation

per year; DoD and DHHS/NIH have

multiple solicitations


Review processes by agency: who’s the audience?

DoD Internal

NASA Internal

DOT Internal

EPA Internal

DOE External

DHS Internal

DOC Internal

NSF External

USDA External

DoED Internal

NIH External

http://grants.nih.gov/grants/funding/sbir.htm, Overview of the SBIR/STTR Program


Discussions during open solicitations?

DoD Restricted

NASA Restricted

DOT Restricted

EPA Restricted

DOE Restricted

DHS Restricted

DOC Restricted

NSF Open

USDA Open

DoED Open

NIH Open


• Phase I

Between 1 to 5 and 1 to 15

• Phase II

Between 1 to 2 and 1 to 3

SBIR success ratios


Who are winning SBIR/STTR awards? (DoD data)

2008 2009

New Awardee 22% 20%

Prior Phase I only 7% 7%

1-4 Phase II awards 35% 32%

5+ Phase II awards 36% 41%


SBIR/STTR firm size distribution (DoD data)

Number of Employees 2008 2009

1 to 9 39% 40%

10-24 20% 29%

25-49 14% 13%

50-99 10% 10%

100-249 7% 6%

250-499 3% 2%


SBIR/STTR evaluation criteria

• Technical merit

• Team qualifications

• Value to agency

• Potential for commercial

• Cost / cost realism


Electronic proposal submissions

• Nearly all agencies now require electronic submissions

• Allow enough time -- weeks, not days

• Prepare for multiple site submission processes

• NIH: 20% of electronic submissions performed by service providers


The government and IP rights

• Worldwide “March-In” rights

• Non-exclusive license

• Royalty-free license

• World-wide license (government not in business to commercialize)


•Rights in inventions •Rights in technical data and computer software developed or provided under government contracts •Protecting rights in information in proposals •Protecting company-confidential information or trade secrets under FOIA •Use of nondisclosure agreements •Consider an IP Disclosure Plan •Protecting IP rights in subcontracts and teaming agreements •Retain the best counsel who know IP, licensing and FAR, DFAR

IP Considerations for SBIR/STTR ventures


Key financial management & accounting requirements

• Financial capability to perform

• Adequate accounting system: – Time charging

– Chart of Accounts

– Budgets

• Job cost accounting: – Segregation of Project/Contract costs

• Reporting (internal and external practices)

• Billing, reporting, shipping and other forms

• Retain professionals who know these areas! – They are not so easy to find!


Advantages

• Payments on Time

• Pays for High Risk Developments – Invests in Research

• Desires Small Businesses to Succeed – Resources

• Validates technologies

• No Equity

• Well-Defined Market

Disadvantages

• Slow Procurement Cycles

• Contractual, Administrative Burdens, Negotiations

Delivery

Security

Billing

• Shared Ownership of

Technology

• No Financial Privacy

Program Tradeoffs - Sharon’s Personal Experiences


SBIR information sources

http://www.zyn.com/sbir/

http://www.sbir.gov

http://www.inknowvation.com/


“Get Ready” for the SBIR Program It’s free!

NEWS – Major Update Coming.

UP