How the program works and what to expect businesses that passed the competitive selection and became its participants?
Program SBIR / STTR consists of three stages
First – this funding to $ 150 thousand for a period of 6 months to 1 year.
If you successfully pass this stage, then the second step, you can get a grant of up to $ 1 million over two years. Not exceed those budgets by 50% at the request of the agency to which the company operates, that is, up to 150 thousand for the first and $ 1.5 million for the second phase. Funding may be allocated either a grant or a contract, or in mixed form. Depending on the project, there are conditions on compulsory participation in the partnership of research organizations such as universities and research centers.
In the third stage of the program, participants receive assistance in business matters, but funding for the purpose of the program is not available. At the same time, even if the company is in the second stage you can use for this purpose a part of an existing grant. In addition, the agency with which you work can help in attracting money from other sources to finance the phase-to-market and monetize your ideas.
Advantages of participation in the program SBIR / STTR
There are several, and they are all very powerful. First, the grant funding in the form of grants that you get on the first and second stages. Secondly, you get not only money, but the smart money, as in the implementation of your idea, you are helping the leading American experts in the field. Also you get a good opportunity to get acquainted with their industry from the inside. This can help in the future to participate in the tender for the supply of goods or services for state agencies.
It is very important that the grants or contracts for these programs does not affect the share owners. The government does not claim a stake in your company, that is, reducing the share of the founders of the business in the company’s capital does not occur.
Receiving grants under this program also significantly increases your reputational capital in the eyes of private investors, as they know that you were very strict selection of this program. This will help you increase the value of the business and attract investors to the more favorable terms for you.
Some practical tips
If you decide to participate in this program, then proceed to the preparation of documents necessary to advance a better two months. Do not leave filing to the last day, because If there are any errors, time for an adjustment you have left. There are three submission deadline – January 5, 5 April and 5 September (when working with some agencies only 5 January and 5 September).
After filing your application passes the examination of experts, and after about 6 months, a decision on which projects will be funded. For example, the company filed an application in early January. If it wins the competition project, the company will receive funding in July. About 20% of the announced projects receive funding for phase 1, of which approximately 40% are in the next stage and receive additional funding (up to $ 1.5 million). That is, it is quite competitive program with a large number of applicants.
In 2014, more than 4 thousand companies have applied to participate in the program, and the total amount of funding of almost $ 400 million. Once again, the application process is rather complicated, constantly raises many questions, for example, it is possible to apply for the second phase immediately when the first phase has already been completed with funds from other sources or to apply for two stages at once, etc.
Therefore, if you decide to participate in the program, the application process must begin in advance. And if you do not have time to prepare all the necessary information to the due date, then you have to wait for the next deadline.