No, I’m not going to talk about the strategic board game of my youth. I’m talking about research risk. Solicitations state that the research you undertake with an SBIR or STTR should be “risky”. So what does this mean? Risk is defined as “the chance that an actual return will be different than expected.”
Phase I awards are for feasibility studies. Yes, you should have a clear understanding of the subject area—enough to make a realistic stab at a hypothesis, but if you already know the outcomes, why do you need research money to determine feasibility?
Preliminary research in the area you are proposing is acceptable (almost expected), but what you are now proposing is new. Remember, you are proposing an innovative approach or innovative technology. Others might have tried, but when you write your proposal, you need to convince the reviewers that you are going out on a limb with your hypothesis. It might work, but it might not.
If it doesn’t work as expected, what are you going to do to overcome these possible deviations from your hypothesis? Let the reviewers know that you are prepared for these possible unexpected outcomes.
As mentioned in an earlier post, when we conducted half-day SBIR workshops out in the state this winter, there were questions about when it would be held in Atlanta. OK, so the date is May 14th from 8:00 am to noon. I know you have heard this line before, but enrollment really is limited and if we get the response that was received in Athens and Savannah, registration will be cut off.
So, why should you attend? Even in the best of times (which is not now) it is difficult for a small high-tech company and particularly a start-up to obtain the initial funding to move a great idea from basic technology towards a product. At over $2 billion annually, the largest seed capital fund in the United States for doing this is the federal Small Business Innovation Research (SBIR) program and its parallel Small Business Technology Transfer (STTR) program.
This short workshop will first give an overview of how the SBIR and STTR programs work and will help you decide if this is something you should get involved with. This includes who qualifies, what the participating federal agencies are looking for, what the intellectual property issues are, what the funding limits are, and what the timeline is.
The workshop then goes into what is involved in a preparing a competitive proposal for SBIR and STTR funding. How you approach the proposal, what points need to be addressed, how you construct the budget, examples of good and bad proposals and sources of assistance are covered.
Our co-host, the Technology Association of Georgia (TAG), is handling registration. Register NOW!
A Gantt Chart is a project planning chart which allows for a visual representation of your research. It also allows you to keep track of the status of the individual tasks within your research. If you have a research plan in your proposal, you should include a Gantt chart (Hint hint: if you are writing an SBIR or STTR proposal, then you WILL have a research plan).
Not only will a Gantt chart give the reviewer a thumbnail sketch of the tasks/tests you are proposing, it will allow you to calculate the amount of time that will be required for the whole research project and help you outline your proposal. Will you be able to complete the tasks in the desired amount of time? Will the tasks/tests you are proposing meet the corresponding Aim/Objective?
Start with your Aims/Objectives. List each one. Under each Aim/Objective, list each and every task/test you will perform in order to meet that Aim/Objective. To the side of each task/test, you will have a timeline which is then broken into weeks, months, or maybe hours (check in the solicitation and budget information to see how you will be calculating time for that agency).
Now, sit back and actually look at your chart. The whole timeline of the Gantt chart should not exceed the length of the award—if it is a six-month Phase I SBIR, you should not have a 12-month Gantt chart and vice versa. Since the majority of the SBIR/STTR funds will go to pay the individuals carrying out the research plan, make sure you will be able to meet the budget limits. If the number of months or the amount of time required for the total number of tasks exceeds the solicitation requirements, you will need to re-think and re-work your research plan.
So you’re going to include a subcontract in your SBIR
proposal. First, stop and ask yourself
“why?” SBIR funding is there to help
your company research and then commercialize a product that will
sustain/advance your company. Are there tasks that your employees cannot do or are not
qualified to do? You don’t
want to give your company’s money away to a subcontractor if you don’t have
to.
What are the specific tasks that the subcontractor
will do? Before you talk to a
potential subcontractor, outline the research plan and list of all the tasks necessary to carry out the plan.
Determine which tasks you can do in-house and what really needs done by
an “expert” outside of the company.
How much time will the subcontractor need to dedicate to your
research? Keep in mind, time is money—subcontracts
for Phase I SBIR proposals are capped at 33% of the overall budget.
Be sure to evaluate the subcontractor. Why are you choosing this particular subcontractor? Have you verified that they are reliable, have
the necessary skills, and time to complete the tasks you need? Make sure you can verify their availability. This specific subcontractor might be THE
perfect “expert” for your project, but if they are busy with other projects,
they might not have the appropriate amount of time to dedicate to your project. Some
agencies will require signed sub-agreements to be included with your SBIR
proposal, while others need the signed agreements within 10 days of being
notified of a pending award. Either
case, details of the subcontract should be worked out before the actual
proposal is written.
Remember, just because you are allowed to subcontract
some of the work, it doesn’t mean you have to–or you should. Think all angles through before you write
your proposal to include a subcontractor.
(NOTE: an STTR requires that 30-60% of the research MUST be
subcontracted to a non-profit research institute)
In early February we held well attended SBIR workshops in Athens, Augusta, Savannah and Warner Robins. Why not Atlanta? Well, our thinking was that we are located in Atlanta and readily available to those in the metro area so it was unnecessary. However, in publicizing these workshops, we received inquiries as when this workshop would be offered in Atlanta and even had people traveling from Atlanta to the Athens workshop.
So, maybe we were wrong. After all the large majority of technology development in Georgia occurs in metro Atlanta. So, we will be looking at first offering the same half-day workshop that was held around the state. This workshop first explains the SBIR and STTR programs and helps you determine if this potential funding source fits your needs and then explores the details of what goes into a winning SBIR or STTR proposal.
When should we offer this? Well, most of the federal agencies with the largest SBIR/STTR budgets have solicitations of proposals with deadlines sometime during the summer. DoD and NSF both have June due dates. NIH and USDA are due in August and NASA in September. So, a workshop in late April or early May would be timely. Future workshops that are under discussion cover topics such as “Now that your start-up has been selected for SBIR funding, what do you need to do?” and “How to develop a winning commercialization plan”. Let us know if there are other subjects that you would like for us to address.
Why does your idea need to be developed? The world's done just fine without it up until now—why now? What is the agency and the American tax payer going to get out of it? Each agency has a role to play in serving/protecting America—does your idea fit the agency’s mission?
Yes, SBIR/STTR funding is available to help your business get off the ground or develop a new product line for your company, BUT your focus needs to be on solving the need dictated by the funding agency. They are your “customer” for this money.
If the agency releases detailed topics in its solicitation, then the topic you choose IS the problem you must solve–remember, your proposal must address ALL the points in that topic when developing your solution. If the agency releases general topics in its solicitation, then you must come up with a problem AND a solution which will fit within that topic. Your proposals are not product brochures or journal articles where you are describing what you have already done; they are opportunities for you to solve a problem the agency has identified. Before you start trying to describe your solution, you MUST define the problem.
So, you've heard about SBIR and STTR but still a little fuzzy about how it works or if you qualify. Maybe you know about it, but have never actually submitted a proposal because it seems so daunting. Maybe you've submitted a proposal but were unsuccessful and don't understand why you didn't receive an ward. Maybe we can help.
The SBIR Assistance Program for the State of Georgia will present this short workshop which will first give an overview of how the SBIR and STTR programs work and will help you decide if this is something you should get involved with. This includes who qualifies, what the participating federal agencies are looking for, what the intellectual property issues are, what the funding limits are, and what the timeline is.
The workshop then goes into what is involved in a preparing a competitive proposal for SBIR and STTR funding. How you approach the proposal, what points need to be addressed, how you construct the budget, examples of good and bad proposals and sources of assistance are covered.
Attend one of the following SBIR/STTR Workshops in Georgia:
In this competitive age, a financial boost from a federal agency can be just what a company needs to take its technology to the next level with the goal of eventually commercializing it.
Come learn how!
“Well, if it were a snake, it would have bitten you!” Ever heard that expression? It means that something is right in front of you and is so blatantly obvious, but for some reason, you don’t see it. Our eyes are wonderful things, but occasionally they play tricks on us. We miss seeing objects because we are not looking for them, or we see what we think we see, rather than see what is actually there. This is often the case when writing a proposal.
You’ve worked on your proposal for weeks and you know the material so well, but sometimes you’re too close. You leave out words or key concepts and don’t even realize it. It might not be as clear as you think it is.
Misplaced or missing key concepts are hard to catch unless you have an outsider’s perspective. Give your proposal to someone outside your company to review. Ask them if it is clear; see if they can summarize what you've said. If not, then you need re-engineer your proposal—it needs to be scientifically sound, but it also needs to be written in simple, precise sentences.
The staff of the SBIR Assistance Program regularly review and critique proposals. We know what the agencies are looking for in a proposal, and we can assess it for clarity and soundness. Since we want to give you the opportunity to actually implement our suggestions and make corrections, don’t wait until the last minute to send it to us. Send your rough draft (or at least part of it) to us no less than a week before the submission deadline. We will review it and give you suggestions for improvement.
OK, let’s be honest, the reason you’re taking the time to write an SBIR/STTR proposal is because you’re interested in receiving money. Well, an agency isn’t just going to give you the money. You must first prepare a budget (also known as a cost proposal) which will tell the agency how you plan to use their money.
Your budget will have Direct Costs –costs that you can say are specific to this SBIR/STTR (the actual hours worked on this project, the materials acquired, consumed, or expended specifically for the purpose of this awards, etc.), and Indirect Costs—costs your company will have, whether you receive the SBIR/STTR award or not (rent, utilities, office supplies, etc.). This budget is the budget for THIS SBIR/STTR project—not the budget for your entire company. You will be able to claim only a portion of the company’s Indirect Costs in your SBIR/STTR budget.
Keep in mind, just because it is an expense (whether Direct or Indirect), it doesn’t mean the government will reimburse you for it. You must take into account that there are “allowable” and “unallowable” costs. The FAR (Federal Acquisition Regulation) is the standard set of rules that all federal agencies must abide by when determining expenses, so you need to learn these rules: FAR Subchapter E (General Contracting Requirements), Part 31 (Contract Cost Principles and Procedures).
Examples of unallowable costs:
· Interest and other financial costs
· Fines and penalties
· Lobbying costs
· Most advertising
· Federal income taxes
NOTE: Even within the allowable limits outlined in the FAR, some agencies will have further restrictions for SBIR/STTR, so be sure to read your solicitation and any cost proposal preparation materials provided by the agency.
So you didn’t receive an award. Now what? Is this a dead end? Maybe…but then again, maybe not.
Can you determine why you didn’t receive the award? Remember, these are human beings reviewing and selecting awards—some internal and some external to the agency—they know what they are looking for in a proposal and you need to know what they want.
If the idea is good and the science behind your proposed solution is good, reviewers will often give you information which will help improve your chances for a future submission. Some agencies will allow you to resubmit the same proposals—once you have made their suggested improvements. Some agencies will not allow you to resubmit the same proposal, but the knowledge gained from a reviewer’s comments will help you with future submissions—check with the agency on their re-submission policy.
Here are some common reviewer comments:
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Doesn’t address the agency’s needs
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Doesn’t address the topic
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Overly-ambitious for the timeframe
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Work plan is unrealistic
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Poorly written & presented
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Not innovative—research already done by others
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Investigator (s) inexperienced
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Unconvincing case for commercialization/societal impact
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Problem is more complex than proposer seems to realize
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Lack of focus
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Commercialization potential is week
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Lacks letters of support from potential customers and/or investors
So, how do you know what the reviewer thought? Get a copy of the debriefing/review from the agency. Some agencies will automatically send you these comments; some you will have to request (NOTE: some agencies have a brief time window when they will accept requests for comments—know your agency). Even if you receive the award, you should get a copy of the reviewer’s comments to help you improve on your Phase II proposal and future proposals. Look at the comments: Are they something that can be addressed (AND corrected) for future submissions? If so, think about modifying and re-submitting or mark it down as experience for future submissions. Remember, one in seven proposals gets selected; you might receive funding the first time, but then again, it might take a few tries. Don’t give up.
Contact one of us to review your concept and your proposal. We are experienced reviewers and can help you see areas for improvement.