Lessons Learned for Securing Federal Small Business Grants. Rebecca McNaughton, PhD Project Manager
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1 Lessons Learned for Securing Federal Small Business Grants Rebecca McNaughton, PhD Project Manager infinitesimal LLC
2 For Context: infinitesimal is developing new micro/nano-technologies for biological applications First product is technology developed at NU, which was funded by NSF initially and is now licensed to infinitesimal Relatively new (although growing) market of single-cell biology Competing products are available but not as flexible or functional
3 History Founded as LLC in October 2011 Awarded Phase I funding from NSF and NIH Awarded NSF Phase II funding in August 2013 Established company lab in October 2013 Awarded NIH Phase II funding in February 2015 Timeline of proposals and awards NSF Phase I SBIR NSF Phase II SBIR NIH Phase I STTR NIH Phase II SBIR NIH Phase I SBIR
4 Where Does the Money Go? Phase I Salary you need enough people or a highly skilled (read: wellpaid) person to quickly get results needed for Phase II proposal! Phase II Indirect costs gives more flexibility and opportunity More employees = more expenses Materials Salary Salary Materials Other Other (Facilities, Travel, Indirect) Business development and marketing can not be directly charged to the grant these tasks must be done with company time/money.
5 NSF Supplemental Funding Opportunities Phase II Gap Funding (Phase IIB) Extends the R&D efforts beyond the current grant Max Funding: $500,000 per award from NSF Requirements: 3rd party investment/commitment of at least $100k. Commercial/Strategic Partnerships (TECP) Funding for additional research that goes beyond the Phase II project s objectives to meet the technical specifications or additional proof-of-concept requirements. Max Funding: 20% of the Phase II award, up to $150,000 Commercialization Assistance Program (CAP) Funding aimed at enabling the grantee to secure the services of a third-party service provider to assist in commercialization activities. Max Funding: $10,000 per Phase II award (one per active Phase II grant)
6 Tips for Writing the Business Grants - Technical Write big picture present the final goal, even for Phase I Focus on proof of concept, proof of method of use DO NOT focus on mechanisms Show progressive steps of development
7 Tips for Writing Business Grants - Commercialization Don t gloss over the commercialization section Be as specific as possible Define the users and tell why they would want your invention Give specific examples of new capabilities and comparisons to current methods or products Try to get letters of support/interest from potential users or business partners Know the market and compare to competitors Combine every possible source of support to make your case Give stats on number of papers/articles published about the topic Name any professional groups, Linkedin groups, or student groups interested in topic List professional conferences that address the topic or have related sessions
8 Difficulties of Securing Phase II Funds (from a scientist s perspective) 12 page commercialization plan Requires at least 10x more time than you think it will It is hard to get people to spend time talking to you about something that is still in early development Best leads likely to come from discussions at conferences Grant agencies want to see a full-time business development person on the team, but won t pay for it. Use free start-up mentoring resources. How do you keep going while waiting for review? What if the money runs out between grants?
9 Strategic Advice If your product could have two or more possible applications, divide the R&D tasks to go after multiple grants. Seek out all supplemental funding even small grants for attending conferences/trade shows can be valuable for developing commercialization. Remember that the SBIR/STTR grants are meant to lead to a product Product doesn t have to be your final end product. If significant R&D will likely be needed after Phase II, seek partnership with a larger company as soon as possible. Find a good grant writer for your team.
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