 In This Issue
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SBIR/STTR FUNDING: Solving the "Come Back When..." Problem
Companies developing high-risk, high-return technology-based products often face a funding conundrum. They need capital to conduct their R&D. However, when that R&D has high technical risk they typically encounter the "come back when" problem.  What do I mean by this? When the opportunity presents a high return, the sources of capital sought are often venture capital, angel funding and/or corporate investment. Presuming the overall business strategy is sound and meets the scope of the potential investor, the opportunity will be considered. However... and here is when you hit the wall.... IF there is still high technical risk, most investors will tell you to "come back when". When is when? It varies. When you have customers. When you are in the clinic. When you have a working prototype. Those are typical responses. Sounds like a catch 22, right? But there is a potential solution. The federal SBIR/STTR programs provide ~$2.5 billion of non-dilutive capital every year to small businesses developing high risk, high return technology based products. The money is targeted specifically to fund R&D activities to reduce the technical risk thereby helping to facilitate access to follow-on funding. Eleven federal agencies, ranging from the Department of Defense to the National Institutes of Health, have SBIR funds available. The program is competitive but with over $1 million per project of non-dilutive funding available, an SBIR/STTR grant or contract can be the ticket that allows you to come back! Is SBIR/STTR a fit for your technology? BBC has a variety of classes and webinars to help you decide if it's for you and then guide you through the process. Join us at our offices on Oct. 9 and learn SBIR/STTR basics! Plus learn about Michigan's SBIR STTR Assistance Program that provides our training and consulting services with almost all costs covered by the state. When you're ready, we're here.
Lisa Kurek, Managing Partner
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 NIH SBIR/STTR Conference Offers Opportunities to Learn & Connect
The NIH SBIR and STTR programs award over $700 million annually in biomedical and behavioral R&D funding to U.S. small businesses to explore the technological feasibility of innovative projects with commercial potential to create medical solutions for public benefit. The two programs focus on bridging the gap between basic science and the translation of scientific discoveries into tangible products and services.
Join us October 28-30 in Sioux Falls, SD, to learn about NIH SBIR/STTR funding opportunities. This year's two-and-a-half day conference, "How to Be Competitive in a World of Change: Opportunities Through SBIR/STTR Awards," will offer presentations from NIH program staff and other experts, opportunities for one-on-one meetings with staff representing most NIH institutes and centers, a poster session providing examples of NIH-funded SBIR and STTR projects, and a "Pitch to Investors" panel to educate attendees about investor expectations.
The conference will include three tracks: "Navigating through SBIR/STTRs," "Circumventing the Hurdles," and "Path to Commercialization." The conference agenda and receptions planned for Monday and Tuesday evenings will allow ample time to network with other attendees, NIH staff, potential strategic partners and investors.
Who should attend the conference? Small businesses wanting to develop innovative new products and processes; highly motivated small business entrepreneurs looking for new challenges and opportunities to partner with researchers; small businesses interested in new NIH SBIR/STTR initiatives and program changes; university researchers interested in partnering with small businesses or starting their own companies; large companies interested in developing strategic alliances with successful SBIR/STTR awardees; university tech transfer officers and research park administrators; and organizations and consultants providing support to interested SBIR/STTR applicants.
Register for the conference
Robert Vinson, Assistant Program Manager
NIH SBIR/STTR Program Office
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The Upside: Funding Opportunities for Your SBIR Project May Be Higher than You Think!
With the 2012 reauthorization of the SBIR/STTR programs,  specific limits were imposed on the dollar amounts that can be awarded for Phase I and Phase II awards. The October 2012 Policy Directives for both SBIR and STTR indicate an award guideline of $150,000 for Phase I proposals and $1 million for Phase II. The directives also note that agencies may issue awards that exceed these guidelines by no more than 50% without a specific SBA waiver. In other words, the firm caps for awards are $225,000 and $1.5 million respectively.
While this provision seems to limit funding more than previous versions of the law, there was also an exciting change allowing Agencies, at their discretion, to fund TWO back-to-back Phase II awards to one company for high merit projects. Specifically, the Policy Directive states: "A Phase II awardee may receive one additional, sequential Phase II award to continue the work of an initial Phase II award." (Section 4(b)(5)).
This provides a mechanism for Dept. of Defense and other agencies to provide up to an additional $1.5 million to advance projects toward Phase III using SBIR/STTR set-aside dollars.
Since this provision is entirely at agency discretion, there is no guarantee that your project will receive a second Phase II. A BBC client recently told us that his contact at the Navy did indeed bring the program to his attention.
So what can you do if your agency contact has not suggested this option for your project? If your Phase II results are positive, you should definitely ask your Program Manager if their Agency or Component will consider you for a sequential award well before the conclusion of your initial Phase II award. This is yet another reason to be in regular, close communication with your Program Manager during your project!
Becky Aistrup, Principal Consultant
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ARPA-E Will Make SBIR Awards to VC-Owned Companies
The Advanced Research Projects Agency-Energy (ARPA-E), an agency within the Department of Energy (DOE), announced that it will begin making its SBIR grants available to venture capital-owned small businesses.
The SBIR/STTR Reauthorization Act of 2011 allows, but does not require, agencies to make awards to small business that are majority-owned by multiple venture capital operating companies, hedge funds, or private equity funds (VCOC/HF/PEF). The National Institutes of Health, Department of Energy and the National Science Foundation may award up to 25% of their SBIR funds to such companies. All other SBIR agencies are limited to 15%.
Until the APRA-E announcement, NIH was the only agency to allow VCOC/HF/PEF companies to participate in its SBIR program, but not its STTR program. At this time DOE itself has no plans to make SBIR/STTR awards to VCOC/HF/PEF companies.
Contact BBC for more information about ARPA-E and DOE SBIR program.
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NASA STTR Partnering Site Opens
SBIR Gateway has a new tool designed to help small businesses and research institutions find potential partners for research topics within the National Aeronautics and Space Administration (NASA) Small Business Technology Transfer (STTR) program.
The STTR release is expected in November, but NASA encourages those interested to look at last year's NASA STTR topics now and register your organization's area of interest in partnering basis. The sooner your register the better your chances for finding a high quality partner.
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New Program Certifications Required for SBIR and STTR Awards
Effective October 1, NIH will replace the pre-award small business concern "Verification Statement" form with a revised "Funding Agreement Certification" and will introduce a post-award "Life Cycle Certification" form consistent with the SBIR and STTR Policy Directives.
This certification is required for all new or renewal grants as part of the Just In Time process. These certifications are necessary to assure that:
- the applicant meets SBA size criteria
- all work is being conducted in the United States
- a minimum amount of work is performed by its own employees within its own facilities
A second certification, the "Life Cycle Certification," will be required throughout the life of the project. The certification is intended to ensure the ongoing compliance of the small business to the assurances provided in the Funding Agreement Certification prior to the award. The Life Cycle Certification is not submitted to NIH but is to be kept on file in accordance with the records retention policy. Compliance to the certification is indicated by drawing funds from Division of Payment Management. A certification is required:
- For SBIR and STTR Phase II Awardees: prior to receiving more than 50% of the total award amount and prior to final payment or disbursement from the Payment Management System (PMS)
- For SBIR and STTR Phase I Awardees: At the time of receiving final payment or disbursement from the Payment Management System
The Funding Agreement Certification and Life Cycle Certification forms are now available for SBIR and STTR applicants and awardees in fillable format. Applicants and awardees are encouraged to review each form carefully prior to applying for or accepting an award. Read the full notice
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Onsite
NASA/DOE SBIR Tips
Sept. 30 - McLean, VA
Proposal Prep for NIH + Commercialization & Budget Planning
Oct 1-2 - Charlottesville, VA
SBIR/STTR Proposal Prep, Commercial-ization & Budget Planning - All Agencies
Oct 3-4 - Blacksburg VA
SBIR 101-Intro & Overview
Oct 9 - Ann Arbor, MI
Proposal Prep for NIH
Oct 9-10 - St. Louis, MO
Grants for Innovation & SBIR
Oct 15-16 - Omaha, NB
Proposal Prep for NSF
Oct 10-11 - Newark, DE
Oct 16 - Rochester, MI
Proposal Prep for DoD
Nov 13 - Ann Arbor, MI
Oct 1 - Tips on Electronic Submission to DoE
Oct 3 - How to Prepare a Budget for SBIR/STTR Proposals
Oct 10 - What You Need to Know About Gov't. Audits
Oct 23 - Essentials of Commercialization Planning
Oct 24 - QuickBooks & Compliance
Oct 29 - DoE Overview and Topic Review
Oct 31 - DoD Topics and Component Review
A selection of BBCetc's recorded webinars is now available for purchase.
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The U. S. Department of Commerce (DOC), National Oceanic and Atmospheric Administration (NOAA) has issued its presolicitation to small business firms for participation in Phase I of the FY 2014 NOAA SBIR Program. The full SBIR solicitation will be issued on or about October 16. The full solicitation will be available at the Federal Business Opportunities website. The agency anticipates making multiple Phase I awards, each with a period of performance of six (6) months and a ceiling price not to exceed $95,000. NIH's National Heart, Lung, and Blood Institute (NHLBI) released an RFA, "Technologies to Assess Sleep Health Status in Populations" SBIR applications. The Institute is looking for researchers to develop biomarker panels to do point-of-care assessments for individuals with sleep health issues. Some of the issues that need to be studied include sleep deprivation, chronic sleep deficiency, sleep disorders, and circadian rhythm abnormalities.
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"Business is never so healthy as when, like a chicken, it must do a certain amount of scratching around for what it gets."
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BBCetc is nationally recognized for its expertise in helping technology-based entrepreneurs win federal funding through the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs and use it strategically to propel growth. Its Michigan clients have been awarded over $120 million in funding since 2002. BBCetc capabilities include:
- Technology Assessment
- Commercialization Planning
- SBIR/STTR/Other Research Grant Assistance
- Entrepreneurial Training
- Grants/Contracts Management
734-930-9741
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