Old Strategies to New Technologies
This is another series of "What's available but not accessible". Here talking about the cash flow struggles of many startups, and one old solution.
Following, here are a few things we learned and are eager to share with anyone interested:
Should my startup focus on research or product development?
If you’re a tech startup founder in your beginning years, you’re probably torn apart between what you want to develop and what brings money. This dilemma comes from the common problem among young startups, cash flow.
What if there’s a solution that allows you to do both? And what if I tell you that this isn’t something new?
The Small Business Innovation Research is “America’s Seed Fund” (created in 1982) and allows small businesses to stay alive while researching and innovating at the same time. SBIR sectors can be found in most federal agencies, each year the U.S. government sets apart a certain percentage of the federal budget and puts it into the Congressional Discretionary Budget, SBIR participating agencies fall in this category of the budget. The main purpose of the creation of SBIR is so that small businesses can engage in federal research and development and eventually create something that has the potential for commercialization.
While at Washington DC we briefly met with the Program Executive for SBIR, NASA Headquarters and had the chance to ask some questions about their SBIR program and what would be a good pathway for small businesses in tech.
We learned that emerging tech is unbelievably positioned for success if businesses decide to develop their technology under an SBIR grant.
So if there’s all this money available, why do many startups extinguish all their initial funding on trying to develop technology and then get stranded in the middle of nowhere without money, and without a product? The answer: young founders don’t know much about SBIR, and even though these resources are available, they’re not always accessible.
Gather a strong management and development team for your startup, if you don’t already have one, then do your homework to find out how SBIRs work, because that's the big door that leads to amazing opportunities.
The National Science Foundation (NSF) has the perfect SBIR program for young startups who have talent, niche tech, high skills, and lots of energy to throw into the research and development of new tech stuff. While their program is structured and requires a disciplined team, the outcomes are more open ended than other federal organizations, like NASA for example. I wouldn’t recommend going for a NASA SBIR unless you have already developed a technology that you know for sure it works and can be applied to NASA’s immediate needs.
NSF is the only federal agency whose mission includes support for all fields of fundamental science and engineering, except for medical sciences. If you’re into developing for medical sciences, you might want to check the NSF medical counterpart which is the National Institute of Health (NIH) and see what SBIRs align with your goals.
We actually met with one of their research labs while in DC and they’re doing some crazy awesome stuff there.
The NSF was created by Congress “to promote the progress of science, to advance the national health, prosperity and welfare…” With an annual budget of $8.1 billion (FY 2019) the agency supports high-risk ideas (yeah, those crazy little ideas of yours that no one wants to fund) well, the government does, because even though those ideas are high-risk, the government sees also the benefits if your hypothesis proves true, and those benefits are worth more than billions because it helps the U.S. “sustain global leadership”.
“The Agency supports novel collaborations and numerous projects that may seem like science fiction today, but which the public will take for granted tomorrow.” - NSF website.
How Do You Start?
Based on my [short] experience, I recommend that you rigorously research about SBIR’s different funding opportunities and find a grant that aligns with your company’s technological roadmap and goals. Also, take advantage of the conferences and road tours that SBIR does each year, they literally tour the U.S. teaching people what is SBIR all about, this is where you can get a 1:1 with a representative from NSF SBIR, NASA SBIR and other agencies.
Here is what you need in order to get started, check out the SBIR website and scroll down to the “Three-Phase Program” to learn about the awards amounts and terms. Also, check the latest NSF SBIR 2019 Solicitation for detail info about what are they needing this year. You won’t regret it.
Questions? Hit me up through the contact form in my home page. No questions? Then what are you waiting for? Get to work!
You’re welcome ;)