Could The Small Business Innovation Research Program Funding Be a Match for You?
Mike Fritsch, NIIC Senior Entrepreneur in Residence
Are you a STEM-preneur with a great idea that needs funding? Most science and technology-oriented entrepreneurs have experienced this. You come up with a great idea. All it needs is a million dollars to sprint out of the starting gate. One of the best types of funding for STEM (Science, Technology Engineering, Math) is the Small Business Innovation Research (SBIR) Program.
What is the SBIR Program?
The U.S. government’s Small Business Innovation Research Program (SBIR) supports scientific excellence and technological innovation. This support comes through the investment of Federal research funds in critical American priorities. The goal is to help to strengthen the national economy, one small business at a time.
The SBIR Program gives small businesses the funds to launch great tech ideas. The following are three reasons that could make the SBIR Program an excellent opportunity for your STEM venture.
1) It provides significant funding at a time when others may not fund you.
2) The government does not expect to own part of your venture.
3) Funds do not require repayment.
This sounds awesome, right? Is this too good to be true? Here are five considerations for you to explore before proceeding.
1. It takes time and effort (usually multiple applications) to get funded.
It is not a simple process to write the SBIR Program proposal. Are you familiar with the whole process? Did you know that most first-time applicants get funded on their fourth submission? Are you willing to invest the time and effort?
2. Your technology may get re-directed to an alternate, more fitting market.
Is your venture’s market focus a direct match for this program? If not, is your company willing to pivot to a new market that is a direct match? Are you willing to get funding for that market instead? Are you sure?
3. You are on government time now, baby.
Most of these projects take years to complete. Will that work with your entrepreneurial timeframe? Will that work for your company?
4. You can get fixated on the project rather than innovation.
Sometimes, you may start working on the project to an acceptable level for the government and forget about how it fits in with your company. If you were doing this on your own, would you have pivoted more often based on market needs and customer discovery? Would you tend to forget about your company growth altogether?
5. With government, money comes new rules.
Are you used to doing extensive reporting? Will your accounting system accommodate what’s necessary? What about the other government policies required? Are you willing?
Maybe this all seems pessimistic to you. I assure you, it is to help you make an informed decision. You need to know what you’re getting into before you start. This excellent funding program can be a great boost, yet it also could be a distraction if you do not pursue the necessary training.
Where can I get help deciding if SBIR is right for my company?
There are a lot of free resources out there to help, especially from the U.S. Small Business Administration (SBA). The SBA typically contracts with one organization within a state to help companies with SBIR/STTR proposals.
Look for the organization that is part of the FAST Program in your state. In Indiana, it’s the Northeast Indiana Innovation Center. Go here to get started.