SBIR - An Entrepreneur's Best Source of Early-Stage, Non-Dilutive Funding

What is this SBIR?

The absolute first thing you should know about the Small Business Innovation Program is that it's acronym is articulated sequentially by letter (i.e., "S-B-I-R").  

[I'm still haunted by the time when, much younger, of course, I pointed out something interesting to a friend on a building's "fay-cade".  Sometimes, more commonly before ebooks, we come to know the definitions and/or literary meanings of words without ever having put them into practice.  I wouldn't want the reader of this blog post to go about referencing the sbir he/she is seeking and have someone hand him/her a spur or a spitter.]

The SBIR program is essentially a coordinated effort among most all federal agencies to issue grants to small businesses for the development of processes, technologies, and tools relevant to the missions or particular needs of the granting agencies.  In 2017, approximately $2.5 billion will be distributed to U.S. small businesses through this program. Typical ceilings are $150,000 for a Phase I award and $1 million for a Phase II award. 

Many investors love SBIR funding because it is non-dilutive, meaning that it will not diminish any equity stakeholder's percentage ownership of the company.  Those who are not keen on SBIR funding may consider the application and reporting process a distraction; however, with proper guidance from experienced mentors and partners, the SBIR process, from application to closeout, can be quite focused.  Additionally, Tennessee is rolling out a matching program in which SBIR recipients would be eligible to apply for complimentary, non-dilutive funding under the administration of non-profit Launch Tennessee. 

How do I know if my idea qualifies for an SBIR award?

The SBIR.gov website is vague about what kinds of ideas could be funded.  That's because each federal agency has discretion to issue requests for proposals according to its individual strategic development plans.  You can nevertheless get a good feel for the targeted technologies, tools, and processes, and importantly, the agencies funding them, by searching the prior and current awards database.  

Aside from the technical merit and relevancy of your idea, you will also need to satisfy limitations on company size (<500) and operations (mostly U.S.), as well as requirements for registrations (e.g. DUNS, SAM) and management (i.e. in-house Principal Investigator). 

Okay, I'm interested. When do I apply?

Since it would make too much sense for there to be one master portal specifically for hosting the various SBIR announcements and applications, you must source this information from each respective funding agency.  Fortunately, the SBIR.gov site at least attempts to guide prospective grantees, or better yet prepare them in the case of the Department of Defense, for what that investigation entails.  

[If you are dismayed by these videos, hang in there.  Most applicants work with advisors, grant writers, and others who are very familiar with these processes and can navigate much of the jargon on your behalf.]  

In 2017, NASA, the Department of Commerce (DOC), Department of Agriculture (USDA), Education Department (ED), Department of Transportation (DoT), and the National Institute of Standards and Technology (NIST) closed solicitations in the first quarter of the calendar year.  The Department of Defense (DoD) and Department of Health and Human Services (HHS) are umbrella organizations for many prominent, well-funded agencies that solicit SBIR proposals throughout the year. 

Okay, after three espressos and a shot of rye I managed to find one or more relevant solicitations and reviewed the details. What now?

The first thing you should do is review the tutorials on the SBIR.gov website, or participate in a local intensive workshop.  Then, check out Launch Tennessee's microgrant program, through which you could be awarded up to $6,000 in grant writing assistance.  

[To apply for a microgrant, you will need to be endorsed by a qualifying Launch Tennessee partner. As a qualifying partner, I will be happy to answer your questions about this program.]

If approved, you will work closely with Launch Tennessee and a network grant writer to submit an optimal application for agency review. 

Resources

What is SBIR? (sbir.gov)

Presentation: Small Business Administration Office of Investment and Innovation (sba.gov)

Video: Getting to Know SBIR and How to Apply (nsf.gov)

Participating Federal Agencies (sbir.gov)

Solicitation Schedule (sbir.gov)

Department of Agriculture SBIR OverviewSchedule

Department of Commerce SBIR OverviewSchedule

Department of Defense SBIR OverviewSchedule

Department of Education SBIR Overview; Schedule

 Department of Energy SBIR Overview; Schedule

Department of Health and Human Services SBIR Overview; Schedule

Department of Homeland Security SBIR Overview; Schedule

Department of Transportation SBIR Overview; Schedule

Environmental Protection Agency SBIR Overview; Schedule

NASA SBIR Overview; Schedule

National Science Foundation SBIR Overview; Schedule