Entrepreneurial Development Center

By Kris Johansen, Ph.D., Iowa State University

Are you looking for funding to develop your technology or idea? Did you know that the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs award over $2 billion annually to small businesses for research/research and development projects with commercial potential?

Are you wondering what are the SBIR and STTR programs? The SBIR program is a competitive set-aside program (2.5% of an agency's extramural budget) for domestic small business concerns to engage in Research/Research and Development (R/R&D) that has the potential for commercialization. The STTR program is a competitive set-aside program (0.3% for agencies with extramural R&D budgets over $1 billion) to facilitate cooperative R&D between small business concerns and U.S. research institutionswith potential for commercialization. The SBIR/STTR programs consist of three phases:

• Phase I: Funds proof of concept/feasibility studies; in general, awards are in amounts up to $100,000 for 6 months (SBIR) or $150,000 for one year (STTR).


• Phase II: Funds full R&D effort; in general, awards are for two years and up to $750,000. Only Phase I awardees are eligible to apply for Phase II funding.


• Phase III: Commercialization stage; requires the use of non-SBIR/STTR funds.

Agencies that participate in the SBIR program include: the Departments of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, Homeland Security, and Transportation, as well as the Environmental Protection Agency, National Aeronautics and Space Administration, and the National Science Foundation. Agencies that participate in the STTR program include: the Departments of Defense, Energy, Health and Human Services, and Homeland Security, as well as the National Aeronautics and Space Administration, and the National Science Foundation.

To be eligible to apply for SBIR/STTR funds, a small business must be organized for profit, under 500 employees in size, located in the United States, and at least 51% owned and independently operated by US citizens or legal resident aliens. In addition, the small business must be the primary employer for the project's principal investigator at the time of award (some exceptions exist for the STTR program).

Stimulating technological innovation and using small businesses to meet federal R&D needs are among the goals of the SBIR/STTR programs. In addition, a small business must respond to a federal solicitation topic with a proposal to apply for an SBIR or STTR award. Getting a proposal ready can be a time-consuming process, and the odds of receiving funding across the participating agencies is about one out of eight for Phase I SBIR proprosals. Kris Johansen, SBIR/STTR Program Administrator in Iowa State University's Office of Intellectual Property and Technology Transfer (OIPTT) has prepared multiple successful SBIR applications and served as a reviewer for the National Science Foundation and the USDA. With her expertise, OIPTT offers the following free services to Iowa companies to ease the proposal preparation process:

• Assistance with proposal writing. OIPTT will coach your company on how to adhere to proposal guidelines and prepare a competitive application.


• Confidential proposal review. OIPTT staff will review and edit your proposal.


• Identification of potential collaborators or consultants. We can help find a collaborator that may give your proposal a competitive edge or enhance your research capabilities.


• Identification of solicitations that match R&D capabilities. Hundreds of topics in widely varying areas are published each year. OIPTT can help your company identify appropriate solicitations.


• Informational seminars. We can visit your organization to tell you more about the SBIR/STTR programs.


• Proposal preparation workshops. In-depth training on the programs and how to prepare proposals.


• Monthly newsletter. Keep current on new solicitations and changes in the program.

Why should you apply for funding? First, there is no pay back requirement these awards are not loans. Second, receiving funding provides recognition, verification and visibility for your company and technology or idea. Finally, these programs provide seed money to fund high risk projects, funding that may be leveraged to attract other sources of capital.

For more information or assistance, contact:
Kris Johansen, Ph.D.
Office of Intellectual Property and Technology Transfer
310 Lab of Mechanics
Ames, IA 50011
Phone (515)294-3208
Email: kajohans@iastate.edu
www.techtransfer.iastate.edu