SBIR grants from the DOD!

Warrent Katz gave a talk tonight at TechStars about building companies using the SBIR program at the Department of Defence (DOD) for funding.  He told a very compelling story about building his company, MÄK Technologies, which, over the past decade or so, has done millions of dollars worth of research through the SBIR program at the DOD.  Warren and a partner founded the firm when they won their first SBIR grant.  He went through the process of finding a workable SBIR solicitation with us and discussed his experiences over the years.

The SBIR program exists to encourage small businesses to develop and commercialize technology that the government could later purchase commercially.  The departments that fund SBIR work do retain rights to for a period of time to the IP produced by the research, but in general, if the company that did the research is selling a product with the technology, the department will generally purchase that from the company as opposed building it elsewhere.

SBIR grants are up to $100,000 for six months of Phase I research (Project Feasibility).  Phase II grants (Project development to prototype) are up to $750,000.

How to win SBIR contracts

1. SBIR solicitations are released 3 times a year.  The next set will be released on July 27th 2009.  When the solicitations are released, search through them, find the 10 or 15 that you and your company’s background are suited suited for.
2. Call the listed contact for the solicitation.  This is a key point.  The people in government agencies who are involved in creating and distributing these grants are people like anyone else.  You are basically in the position of selling your proposal to the decision makers in this process and a “warm” proposal is always going to carry more weight than a “cold” one.  The more people you can get in touch with and build relationships with who are involved in this process, the better.  Talk to the solicitation contact person about the problem they are addressing.  Talk about your proposed solution to the problem.  Try to get a feel for how well your solution addresses the problem, and how well it will be received.
3. Eliminate the solicitations that you don’t have a chance of winning from your list of potential proposals
4. Write the proposals!  Proposals are capped at 20 pages; writing 20 pages of technical content for the chance at a $100,000 grant to build IP that you own is a pretty good proposition.  You can submit multiple proposals per solicitation period, submit proposals to as many solicitations as you have time and energy to write.

It can be helpful to be aware of the three general

categories of solicitations:

1. The writer of the solicitation has a specific problem in their work and is looking for some creative and innovative approaches to solving the specific problem.  If you’ve got some cool technology or experience that can be applied to that specific problem, you are in good shape
2. The writer is responsible for multiple projects joined under a general theme (wireless data transfer for example), and is looking for some cool ideas that industry can come up with around that general theme.  If you are crazy enough to think outside the box, but credible enough to not be written off as a crackpot, you have a shot at getting a proposal accepted.
3. The writer has a specific problem but already knows how they want to solve it.  They are basically looking for someone to do the grunt work of proving out and implementing their solution here.

You can find the DOD’s SBIR program here (flashback to what the Internet looked like in the early 90’s!).  There are also SBIR programs in the DOT, NSF, DOE, NASA, and various other government agencies.  Check out the SBA’s list here (watch out for blink tags!!)

My immense thanks goes out to Warren Katz for his session at TechStars Boston.