November 30, 1999 in SBIR/STTR News

To Sub or Not To Sub

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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

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

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