Hidden in the Fine Print - SBIR Explicitly Excluded from NIH Stimulus Money

[THIS STORY HAS EVOLVED SINCE THIS POSTING. SENATE TELLS NIH TO FULLY FUND SBIR DESPITE THE EXCLUSION.....READ THE POST OF MARCH 10th FOR THE STORY!]

SBIR's long time friend and advocate Ann Eskesen has alerted us to the fact that hidden (YES HIDDEN) in the new "Stimulus" bill is the provision that the money being provided to the NIH for additional R&D ($7.4 Billion) must NOT be used for SBIR or STTR projects. Huh? What were they thinking? As Ann said in her alert, "Such an exclusion is underhanded and entirely inappropriate." There's the understatement of the year (so far)!

Entirely inappropriate for sure. Does it make sense for the NIH to not seek additional innovative solutions from our small businesses -- a sector hailed by President Obama himself as being the most likely one to create the jobs that we so desperately need? 2.5% +0.3% of $7.4B is $207.2M that's been inappropriately withheld from our small businesses. That could be used to create a whole bunch of jobs!

And underhanded to boot! They snuck the wording into the fine print in "code" so we wouldn't spot it. A search for "SBIR" or "STTR" won't turn anything up. Here's the relevant section from page 62 of the Stimulus Bill - H.R. 1 (rub your eyes, it's hard to read):

National Institutes of Health / national center for research resources ...... For an additional amount for `Office of the Director', $8,200,000,000: Provided, That $7,400,000,000 shall be transferred to the Institutes and Centers of the National Institutes of Health (`NIH') and to the Common Fund established under section 402A(c)(1) of the Public Health Service Act in proportion to the appropriations otherwise made to such Institutes, Centers, and Common Fund for fiscal year 2009: Provided further, That these funds shall be used to support additional scientific research and shall be merged with and be available for the same purposes as the appropriation or fund to which transferred: Provided further, That this transfer authority is in addition to any other transfer authority available to the NIH: Provided further, That none of these funds may be transferred to `National Institutes of Health--Buildings and Facilities', the Center for Scientific Review, the Center for Information Technology, the Clinical Center, or the Global Fund for HIV/AIDS, Tuberculosis and Malaria: Provided further, That the funds provided in this Act to the NIH shall not be subject to the provisions of 15 U.S.C. 638(f)(1) and 15 U.S.C. 638(n)(1): Provided further, That $400,000,000 may be used to carry out section 215 of division G of Public Law 110-161....

Spot the coded reference to SBIR and STTR? No? Not even with the "clue" I gave you? Well, you probably didn't know that 15 U.S.C. 638(f)(1) and 15 U.S.C. 638(n)(1) are those parts of the law which address the funding of SBIR and STTR. Yes, the "code" was citing the US Code of Law references without annotation. I agree, Ann, that was underhanded.

Getting steamed? Want to know who put this language in the bill? Ann says that it evidently was included at the initiative of Senator Arlen Specter (R-PA). Why? We don't know. We'd love to find out why he would have allowed such an overtly hostile act against small businesses to have been perpetrated out of his office. If you're in a position to query Senator Specter's office, please do so, and let me know what you find out.

Nothing short of a special bill repealing that exclusion provision can be done about this now -- the bill is law. Maybe we should mount a campaign to promote that. {Senator Kerry - you voted for the Stimulus bill - did you know that provision was in it? If not, please sponsor a bill repealing it!} All you folks from Massachusetts - put some pressure on!

As Ann says, "[This] Sets a strong and dangerous precedent. Once in place, such a provision sets the precedent for every other agency to adopt a similar approach at best to limit, at worst to destroy, the SBIR program." The SBIR Coach joins Ann, and others who advocate on behalf of SBIR, to do everything we can to prevent this from happening.

So, please send everyone you know who's an SBIR supporter a link to this Blog posting (http://sbircoach.blogspot.com/2009/02/hidden-in-fine-print-sbir-explicitly.html) so that they'll be informed of this outrage. Encourage them to be vigilant, and please please please, don't be silent!

UPDATE - Sunday, February 22, 2009: I sent out a FLASH Newsletter to my 250+ subscribers today with some additional information on this. See a copy of it (and other back issues) on my SBIR Coach's Newsletter webpage.

UPDATE - Tuesday, February 24, 2009: My friend Rick Shindell issued an SBIR Insider letter last night that provides some more clues for solving our SBIR Stimulus Exclusion whodunit. You may not like the light it sheds. He also provides some good information to help you support our getting that Continuing Resolution (CR) to keep SBIR alive. Please read it!

UPDATE - Thursday, February 26, 2009: I have crafted a letter requesting repeal of the NIH Stimulus exclusion provision that I will be sending to all of the members of the Small Business Committees in the Senate and the House, as well as to the Leadership of both houses of Congress, my Representative and Senators, and other selected influential legislators. I have posted it on my website in template form. Click HERE to see it. Copy and paste it into your word processor, tailor it as you wish, print it on your letterhead and let 'er fly! Remember, faxing it to the attention of the legislator's "Policy Advisor for Small Business Issues" is the most effective way to get their attention. We can do this.
.

Clean & Renewable Energy SBIRs - From the NIH!

I expect Clean and Green SBIR topics from the DOE and the EPA, and even from the DOD, but today's email from the NIH was a real surprise. The NIH is looking for clean and renewable energy SBIR and STTR proposals for projects in a wide variety of applications. This could be a great economic stimulus for small businesses who never considered applying for an NIH grant before. Here's a partial list:

• Technologies to optimize battery usage and/or energy consumption by medical devices (e.g., hearing aids, dental hand-pieces, chairs, lights), imaging technology (e.g., dental X-ray technology, magnetic resonance imaging systems), radiation therapy equipment (e.g., accelerators for proton radiotherapy), or chair/bed-side information technology (computers and displays).
• Technologies to optimize energy consumption during production and delivery of medical radioisotopes and radiopharmaceuticals.
• Development of batteries with increased storage capacity and/or increased number of charge/discharge cycles.
• Patient monitoring technology that decreases transportation to medical facilities.
• Remote diagnostics and medical care.
• Technology development for manufacture of medical device power sources, such as increased energy density, increased number of charge/discharge cycles before battery failure, solar cells, kinetic to electrical current conversion, and fuel cells.
• Circulatory support systems: Implantable rechargeable batteries and alternate power sources and transcutaneous energy transmission systems
• Compact Implantable Defibrillators
• Respiratory support systems (e.g., artificial lungs, ventilators, CPAP machines): Implantable rechargeable batteries and alternate power sources
• More portable oxygen delivery systems with alternative energy sources
• Robotics and computer assisted surgery
• Mathematical and computer modeling of biological systems
• Information systems to coordinate patient management
• Bioinformatics and interactive databases

And that's only about half of the list! Here's the links to the announcement with the full list:

SBIR: http://grants.nih.gov/grants/guide/pa-files/PA-09-100.html

STTR: http://grants.nih.gov/grants/guide/pa-files/PA-09-101.html

As you can see, this opens up the NIH funding opportunity to a whole new array of technology companies. It's not just bio-tech and pharma anymore! NIH SBIR and STTR proposals are due by April 6th, so don't delay getting started on this. You'll have to download special Grants.gov templates for preparing proposals for these topics. Use the PA numbers in the URLs in the FON block of Basic Search to do it. Confused? You know who to call for help!

My friend Rich Hendel at Boeing sent me their interest list for the DOD's 2009.A STTR round today. Proposals for that are due by March 25th. Send me an email if you'd like a copy of the Boeing list.

I sent out the SBIR Coach's Newsletter for February yesterday. The Special Topic is "How to Protect Your SBIR Data Rights". Copy is downloadable from the website's Newsletter page.

And, finally, please don't forget to send those Legislator Letters on SBIR Reauthorization. Template letter is on the website. As they say at Nike: JUST DO IT!
.

Small Business/University Tech-Transfer Matchmaking - Just in time for Valentine's Day!

This idea could produce a match made in heaven -- well at least in Tech-Transfer heaven! Small technology businesses who are looking to win Small Business Technology Transfer (STTR) grants now have a way to solve a heretofore tough problem -- how to find universities or other research institutions with the appropriate capabilities to partner with.

Thanks to some innovative thinking from Rick Shindell, publisher of The SBIR Gateway, there's now a way for both research institutions and small businesses to register their capabilities and STTR topic interest in a Gateway database, and then use the Gateway's search engine to find that elusive partner.

Starting February 12th, appropriately evolving on Darwin Day, small businesses in search of a DOD STTR research partner are able to query the database and see which research organizations may be interested in partnering on selected topics. It also works the other way - small business can register their interests and research institutions can find them via this matchmaking service.

In announcing this new Gateway service, Rick said:

"Most of us have had some negative consequences due to the economy and/or the investment community. Many universities and colleges have incurred major losses to their endowment funds, and that includes their Science & Technology sector. Entities that previously thought STTR was too small to bother with are now interested in becoming involved.

I've talked with many small and medium sized universities that have said it is hard to find interested and qualified small businesses for partnering in STTR. I also hear from small businesses that they have a hard time finding an interested university or federally funded R&D center (including DOD and DOE National Laboratories) in an STTR project.

As with all of our SBIR Gateway projects, this service is free and is offered in the hope that it will stimulate interest in the STTR program, promote strong partnerships, create and/or preserve jobs, and be of benefit to the sponsoring agency and their mission."

Rick told me that the response he's gotten to this has been exceptionally strong. He's hopeful that this experiment will prove to be a winner. My bet is that we'll see an upsurge in STTR proposals as a result of this initiative. I know for a fact that several of my clients abandoned plans to submit STTR proposals in the past because they just could not find the right university research partner.

See the STTR Matchmaking facility on the SBIR Gateway at: STTR PARTNERING. Proposals in the current DOD STTR round are due March 25th. There's still time to talk to TPOCs, so don't delay in finding that perfect partner!

SBIR Reauthorization Update

The SBIR Coach got back from Washington DC after the Reauthorization Fly-In earlier this week energized to do what it takes to ensure continuance of the SBIR opportunity as the best small business stimulus that this nation has ever implemented. We talked to many House and Senate staffers to carry forth the primary message: PLEASE DON'T LET THE SBIR PROGRAM DIE ON MARCH 20TH.

Thanks to hard work by Jere Glover of the SBTC and Alec Orban of NSBA, we were organized and armed with compelling data, and everyone I talked to seemed to get the message. In a nutshell, it doesn't appear possible that the House and Senate will be able to reach agreement on the issues in the few weeks between now and March 20th, so another Continuing Resolution must be passed to further extend the SBIR expiration deadline and allow us to continue the debate.

This weekend I will compose my letter that I will be sending to our legislators and will post it on my website. You will be able to copy and paste it onto your own letterhead for editing and sending. I'll be sending a FLASH Newsletter to my clients when it's ready. If you'd like to be included in that notice, please subscribe to my Newsletter. We need to alert as many legislators as possible as soon as they return from the Presidents' Day congressional recess.

UPDATE: 2/15/09. The Legislator Letter is posted on my website, and the FLASH Newsletter has been emailed to my clients. Click the links to see them. Please send some letters!
.

SBIR is a strategy, not an end game.

We're in the midst of a campaign to get the SBIR Program reauthorized by the Congress. Everyone agrees that the opportunity that SBIR’s early stage high-risk funding gives to emerging technology businesses is unparalleled. SBIR has been a stimulus for such small businesses since it was created in 1982. Nowhere else can a fledgling business get no-strings money for developing new and innovative technology. Much of the current debate is pretty prosaic: it’s mostly about how much money should be made available by the participating Federal agencies, how much can be awarded for the phases of a project, which companies are eligible to compete for it, and how efficient should the funding process be.

But some of the debate is correctly and appropriately centered on whether the SBIR program is being effective in producing results. Some say that should be measured by computing a comparative Return on Investment (ROI) for the Federal agencies that provide funds. Others say that it’s more a matter of how much revenue derives to a company that begins selling products developed with SBIR funding. Gathering data to compute either of these metrics has proven difficult. But, either way, what it comes down to is that SBIR isn’t going to be effective unless companies use SBIR awards as a strategy for effecting business growth, not as an end game.

Only in the past couple of years have any of the agencies focused resources on improving the likelihood that SBIR funded technology ever evolves to something suitable for end use. The recently established DOD’s CPP and the NIH’s CAP Programs, for example, are good starting points but it’s too soon to see if they’ll produce any definitive results. But fact is that these agency “commercialization” programs won’t produce results unless the companies treat their SBIR funding as a strategic infusion of capital to spur technology development and not just revenue.

The agencies won’t help them do this. Why should they? That’s not their responsibility. If the company completes the work that they proposed to do, the agency is satisfied. And, only some of the agencies ever intend to be customers of the final product that evolves from the funded development. To be blunt, since the SBIR agencies (really they’re your investors not yet your customers) have no equity stake in your future, if they’re not interested in buying the end result (and actually becoming customers), they don’t care if you survive beyond the term of your grant!

For many (some would say most) SBIR companies, the top priority is first getting money in the door to pay expenses before the credit cards are maxed out, and if that’s successful, then to continue to submit proposals and win awards to support the lifestyles of the principals until such time as development is done. SBIR is used as a tactic to produce revenue. And being “done” is some nebulous future event that, for many, means, “Now that I’ve built it, someone will buy it”. It wasn’t envisioned to be that way, but it’s what has evolved to be a pervasive SBIR paradigm. Unfortunately, it only rarely produces commercialization success.

I propose that an innovative shift in thinking must take place to change the paradigm. If you win an award, think about the SBIR funds as a grant. (Yes, I know it’s already a grant – but keep reading!) Now think of that grant not as operating revenue, but as capital that you’re investing in developing a marketable product. Only propose SBIR projects that have a chance to actually produce a marketable product to a pulling market. Yes, it means passing on topics that you might be able to win, but have a very limited market to sell to. To do this means thinking strategic. It’s the only way you’re going to maximize your Return on Invested Capital (ROIC) – a metric you can compute and track.

Unfortunately most small businesses are so strapped for cash that they don’t think they can afford to think strategic. And they’re more wrapped up in the thrill of invention than they are on what’s got to be done to move the technology along to market readiness. Indeed many haven’t even assessed whether there actually is a viable market (try and get away with that from an equity investor!). It’s hard for a struggling entrepreneur to face up to over-the-horizon realities. But it doesn’t have to be that way.

As a coach, I’ve helped many of my clients through the strategic thinking exercises that can help improve their SBIR ROIC, but it can be a hard-to-sell engagement. Frankly it takes no less than a culture shift to make the changes in thinking that are necessary. Sometimes the heels drag and the toes dig in. But persistence does pay off, and I’ve enjoyed some true successes.

I’ve been talking for some time about my view of a strategic approach to seeking funding while working informally with the Arlington Technology Incubator (managed by the Arlington Chamber of Commerce), and the University of Texas at Arlington’s Office of Technology Management. I’m proud of how forward thinking both of these entities are, as they have decided to form a unique public/private joint venture to synergistically lead ideas hatched at either venue to marketability.

We formalized our working relationship this week, and I’ve been retained as their Business Coach. See more about this in the official joint Press Release by clicking HERE. (Note that this arrangement is a contract with my Commercialization Funding Coach company, and, lest you think otherwise, The SBIR Coach will continue coaching successful navigation of the SBIR opportunity on the national scene.)

In my Business Coach role, I’ll be working with those who are served by the UT-Arlington's brand new Venture Innovation Partnership and with the client companies of the Arlington Technology Incubator to help them make the appropriate strategic (and tactical) decisions to facilitate business growth and improve the likelihood of success of their fledgling companies. Of course, going after SBIR funding will be one of the possible strategies that will be considered (would you expect the SBIR Coach to do otherwise?), but charting out the path to commercialization and guiding the maximization of the company’s ROIC will be the focus of my coaching from day one.

If all SBIR awardees took this same approach to how they applied SBIR funds, we might just build evidence that a comparative Federal Agency ROI would favorably reflect on SBIR effectiveness, and the companies would be more likely to fulfill the visions of their founders. The potential is there. Let’s reauthorize SBIR, improving it of course, and continue to provide the opportunity for small technology businesses to get their no-strings seed funding. At the same time, let’s also encourage them to always take a strategic approach to the application of SBIR funds, not just think that by winning SBIR awards they’re being “successful”.
.

Focus on Economic Stimulus Revitalizes SBIR Reauthorization Push

Everyone says that creating jobs is the key to turning around the economy. It’s probably the only thing they do agree on! We evidently can’t look to big businesses to create jobs – they’re all cutting back and standing in line with palms outstretched – the modern day ironic equivalent of the bread line of the 1930s. So it seems to be up to small businesses to do the job creation. That’s easier said than done. Everyone knows that too. Slowly but surely the country is realizing that unless we figure out a way to innovatively stimulate small business better than we’ve ever done it before, we won’t get out from under this economic mess we’re in any time soon. So how do we do that?

Those of us who have been involved with it since the 1980s have always known that SBIR stimulates small business. SBIR itself was the stimulus for forming my two companies -- without that avenue of funding having been available neither one would have ever been launched. Together they created over 200 jobs and pumped tens of millions of Federal dollars into the Texas economy. Multiply that by the thousands of other small companies that have earned SBIR funding (yes -- SBIR money is competitively earned not just handed out) and created innovative technology solutions in response to expressed needs, and you begin to see the magnitude of the potential. What’s been missing is the stimulus to take the technology through its final evolution to make the transition from the laboratory to the marketplace.

Seems pretty obvious to me – we have a successful 27-year-old mechanism for stimulating small business innovation already in place. It’s called Small Business Innovation Research. (Gee, even the name is right!) Pump it up (both with money and improvements to administrative process to speed the money flow) and add to it the stimulus to take that final commercialization step. Do this now and we have the potential to create a significant number of jobs in a relatively short time frame.

I’m by no means alone in this thinking. Led by Jere Glover, a DC attorney (at one time the SBA’s General Counsel) who’s the Director of the NSBA’s Small Business Technology Council (SBTC), there’s a revitalized focus on getting the SBIR Program reauthorized and improved. In fact, if we don’t keep the pressure on, there’s a chance that SBIR could get lost in the shuffle and die. Jere puts it succinctly and bluntly: “Currently, the SBIR is set to expire on March 20th, 2009. Unless it is reauthorized, this program will go away, and Federal Agencies will no longer be required to allocate any of their R&D money to small businesses. We need your help to make sure this important legislation is taken up before it is allowed to expire.”

The SBTC is sponsoring a “Washington Fly-In” on February 9th and 10th, where those of us who understand SBIR’s importance and are willing to commit resources to support it, will make a coordinated effort to educate our legislators in both the House and the Senate on the importance of SBIR as an economic stimulus for small business. The SBIR Coach will be there, of course. We’ll be visiting with the small business liaisons of many of our Senators and Representatives to provide recommendations on how to improve the SBIR Program’s effectiveness so as to stimulate the maximum potential for private sector job creation. The objective will be to garner support and sponsorship for SBIR reauthorization as an economic stimulus.

Join us if you can. Click HERE to register to be a part of the group. The headquarters will be at the Westin DC City Center. You DC locals have no excuse not to participate! We’ll have a planning session at the Westin on Monday evening (Feb 9th). There’s to be a breakfast Tuesday morning (Feb 10th) in the Senate Small Business and Entrepreneurship Committee Hearing Room (Russell 432). We’ll be having a conference call on February 3rd to get everyone briefed on the event. Once you’ve registered you’ll get the details of that and more.

Some of you may be unfamiliar with the complex and somewhat contentious SBIR reauthorization issues. If you'd like to see my view of what the issues are, go to the "SBIR Reauthorization" page under the "SBIR Program" tab on my website: www.SBIRcoach.com. (Refresh your screen if the page doesn't show up under the tab. It's new and your cache may need clearing.)

I’m helping coordinate a Texas delegation. Executives from some of Texas’ most successful SBIR companies have already committed to attend. If you’d like to join our delegation, please let me know ASAP. We’ve already got appointments with both Senatorial offices and quite a few of those from the House. Add your voice to the chorus. In this game, there’s strength in numbers!

Here’s an idea: If you can’t attend the Fly-In, send me a letter to present on your behalf. Letters from all States are welcome!

And if you think that it’s only a few of us SBIR wags who are arguing for such small business economic stimulus, think again. I’ve seen several articles in the past couple of weeks that promote this thinking. To wit: “Use broader definition of shovel-ready in weighing economic stimulus”, “Entrepreneurs are key to job creation”, “Economic Recovery and the SBIR”, and “Nurturing The Soul Of America”.

I predicted earlier this month that SBIR wouldn’t get reauthorized by March 20th, but would simply be temporarily extended without improvement. How quickly my thinking has changed (on the timing, not the issues). Help me be wrong on this prediction!

Stay tuned…..
.

Will President Obama's Techonomics Program Impact SBIR?

Well, we now have a new President, and he's hit the ground running. The Obama administration has proposed federal legislation with an aggressive techonomics [click on the word if you don't know what that means] stimulus package that emphasizes innovative science and technology and calls for dramatic increases in short-term funding levels for R&D. Very significant increases over currently authorized amounts are proposed for the National Science Foundation (NSF), the Department of Energy (DOE), and the National Institute of Standards & Technology (NIST).

This got my attention, as any increases in funding for R&D in the NSF, DOE, and NIST should translate directly into increased funding for SBIRs in those agencies. That means more potential projects for all of us to work on!

Both the R&D and education provisions of the new House initiative harmonize with President Obama's promise to enhance innovation by providing short-term stimulus spending where it is needed, while providing a long-term basis for economic growth. But will it work?

I had a conversation with Dan Loague today. Dan is the Executive Director of the Capital Formation Institute (CFI), an educational organization whose mission is to be the "premier international research and educational entity in the fields of early stage capital financing and enterprise creation and growth." Dan's take on the Obama Techonomics stimulus package, and what it will take to make it work, is:

"Science, technology and research help create the raw materials of innovation, but it’s the buyers, sellers and markets, not inventions, that create jobs and income. Think about it: filling the barn with better paint will not get the barn painted. It’s going to take specific actions, not just hope that new ideas can somehow be turned into U.S. companies that find success the competitive global market.

We should now ask the following key questions: (1) What part of the funding will actually help to produce jobs and new capital from science and technology? (2) How much of the money will be used to increase the launch of new products into the marketplace and the numbers of new consortia of science, technology and corporate solution seekers? (3) How much of the money will be devoted to helping create high impact jobs that will produce new subject matter experts?"

To focus attention on this, the CFI is sponsoring a RoundTable Teleconference on "Obama's Techonomics Program". It's tomorrow, Wednesday, January 21st, at 2PM EST. See the details at http://www.cfi-institute.org/Roundtable. You'll find the call-in number there, along with pictures of the discussion leaders: Robert Boege (ASTRA), Ray Felts (Nine-Sigma), Connie Luthy (Medical Products Innovation), and Marc Oettinger (SURA).

The SBIR Coach will be participating in the call, raising issues pertinent to SBIR of course. I encourage you to join in as well.

Dan and I are now working on a CFI Roundtable Teleconference, to be scheduled in February, to focus on "Reinventing SBIR: Effecting order of magnitude scale improvements in Federal economic stimulus programs designed for small business." Improvements in SBIR will be the goal in the SBIR reauthorization activities to be undertaken with this new Congress, so this is timely and important. Stay tuned for details in upcoming Blog postings, and on the CFI website (http://www.cfi-institute.org).

And, finally, to tie this all together, Tom Still of the Wisconsin Technology Network, highlighted the impact of SBIR on the country's economic health in his just published article (http://wistechnology.com/articles/5389/) on suggestions for economic stimulus priorities:

"[Congress must] Reauthorize the federal Small Business Innovation Research (SBIR) program. Launched 25 years ago, this program has enabled 700,000 small businesses to develop cutting-edge products. Eleven federal agencies granted about $2.3 billion in the latest year for merit-based research and development projects. Over time, SBIR and related programs have created 1.5 million jobs in small companies that typically employ high-wage scientists and engineers. It's a program that works - so why not reinvest?"
.
Indeed! Tune in to tomorrow's Teleconference, and participate! Please!
.
UPDATE: Wednesday, January 21st, 5PM CST
We had the Techonomics Teleconference this afternoon and it was great! Lots of good commentary and questions. The intended hour actually stretched to almost 90 minutes, and Dan said that he'd explore having an ancillary session to continue the discussion. If so, I'll report on it here.
.

The story behind the DOD's 6AM SBIR proposal submission deadline

.
Well, I'm sitting here in my LaZ-Boy recliner, my laptop in my lap, sipping my coffee in the pre-dawn darkness, and reminiscing about what happened six years ago this week. The DOD's winter SBIR proposal cycle just closed an hour or so ago, and I successfully accomplished the final upload of a client's 3rd version of the final draft of their proposal just a few minutes before the 6AM EST deadline. (The things I do for my clients!) Ever wonder why the DOD has a 6AM deadline? It's quite a story...

Back in 2003 the DOD had a 5PM EST deadline for SBIR proposal submissions. The DOD's electronic submission website had been enabled just a year or so earlier, thankfully eliminating those dreadful red-form paper cover pages (remember those?). Of course, everyone always worked right up to the deadline, causing intense pressure on the DOD's network resources and slowdowns as the deadline approached were common. The DOD's instructions included a warning that early submission was recommended. They thought that covered them.

I was working with a client on an Air Force proposal that January afternoon in 2003 as the 5PM deadline loomed. We finished around 3PM and tried to upload the proposal. No response. The site had crashed. The help-line was ringing busy. Talk about frustration! In desperation, as 5PM was just a few minutes away and the site was still down, we finally emailed the proposal to the Air Force's Topic Group Program Manager to time-stamp it, but that wasn't an official way to do it, and we knew that the proposal would probably not be accepted that way.

The next morning I called Ivory Fisher, then the DOD's SBIR Program Director, to ask what they were going to do about the situation, and was informed that their warning advising early submission was sufficient. Nothing needed to be done. Tough luck. Sadly, I predicted that he'd soon be in the middle of a storm of protest. I was right. The firestorm eventually drew Senator Ted Kennedy into it, and the DOD was forced by Congress to re-open the solicitation for three weeks in March to allow the submissions that were prevented by the site crash. Unfortunately that delayed the evaluations and awards, punishing those who had submitted early! Ivory retired soon after, for health reasons unrelated to the angst created by the problem.

My friend Jeff Bond (he had directed the BMDO's SBIR program previously) was appointed to succeed him as the DOD SBIR chief, and he was charged with fixing the system. In addition to increasing the submission site's network resources (I call it enlarging the funnel), he implemented the absolutely brilliant idea of moving the deadline from 5PM to 6AM! That effectively ensured that everyone wouldn't be clogging the funnel at the same time. It works! In the past six years I've only helped a client work to the 6AM deadline twice. Most of the time we finish by the end of business the previous day (or even earlier) without any pressure at all. Thank you Jeff!

By the way, Jeff retired from government service a few years ago and is now Grant & Proposals Director for the Association For Manufacturing Technology (www.amtonline.org). Any of you who are in the manufacturing arena should join this organization and enlist Jeff's counsel if you're desirous of learning about relevant funding opportunities. Give him my regards when you call him.

Time for another cup of coffee.....
.
NOTE: The January Issue of the SBIR Coach's Newsletter will be available by clicking on the following link: SBIR Coach's Newsletter - Jan-2009.
.

Some SBIR Predictions for 2009

For my first Blog of 2009, with the SBIR Program in flux at the same time that our leadership in Washington DC is about to undergo a major shift and with our nation's economy on life support, I thought it would be fun to offer some predictions and ask those of you who follow this Blog to offer your own contributions.

Prediction #1: The SBA will not raise the funding caps on Phase I and Phase II SBIRs independent of reauthorization activities. They announced the intent to do it last fall, and solicited comments, but we haven't seen any action yet. I doubt we will. The SBA has no real authority over the agencies, and the agencies will resist any efforts to interefere in their administration of their R&D budgets. The new SBA chief, Karen Mills, won't allow her boat to be rocked by this issue.

Prediction #2: The Grants.gov submission portal will undergo some major changes as the agencies rebel against being forced to use it. The SBIR grant application submission process is tainted by the extreme hassles of dealing with the vagaries of the arcane processes involved in using this portal. The Dept of Education has gone back to paper submissions rather than use it. Others will follow. Major changes will be announced in how Grants.gov works this year, increasing confusion. Problems will continue.

Prediction #3: The SBIR landscape will become even more competitive as entrepreneurship grows at the same time that agency R&D budgets are being trimmed. Whenever the economy receeds, and talented people find themselves without salaried positions, entrepreneurs emerge. SBIR is just about the only game in town for getting no-strings high-risk seed funding. There are some State initiatives (such as the Texas Emerging Technology Fund) that provide some early seed money, but the amount of money they make available is a drop in the bucket. The net result is more proposals competing with a shrinking pot as agency R&D budgets are trimmed as money is diverted to supporting operations. Remember, the SBIR pot is a percentage of the extramural R&D budget, not a fixed amount.

Prediction #4: Reauthorization of the SBIR program will not be finalized by the March 20th deadline, and we'll see a new continuing resolution to extend it, probably for a period of up to two years. This Congress has much more critical elements than SBIR to deal with, and this issue just won't generate sufficient buzz to rise to the surface in the short time between now and mid March. Besides, we need the full attention of our legislators to get things done right. With new players on key small business committees in both the House and the Senate, we need to educate them on the issues and garner support for improving the program, not weakening it. There's just not enough time to do what's needed, and we MUST avoid knee-jerk rammed through actions such as was done in House last summer, and in misunderstandings that result in obstruction such was done in the Senate this fall. The path of least resistance will be to delay action. That will give us time to marshal our forces to really evolve SBIR in a direction that will stimulate technology innovation rather than stifle it.

OK, that's enough of The SBIR Coach's neck sticking for today. What say you? Any comments on my predictions? Care to offer your own predictions? Let's get some dialog going! Click on the Comments link below and put your two cents worth in! If you'd rather comment in private, email me.

One more thing -- my monthly SBIR Coach's Newsletter provides education on SBIR issues. The January Issue will be available by clicking on the following link: SBIR Coach's Newsletter - Jan-2009. If you have a subject for which you'd like to see some special coverage in an upcoming issue, email me and suggest it.
.

Successful SBIR technology transition may require deviating from the norm

Back in the "old days" when I was helping guide my own companies through the SBIR process, I discovered that all DOD SBIR program managers and administrators did not think alike. Most were very competent at what they did, which was to make sure that proposals turned into contracts, that the proper documents were in the proper places at the proper times, and that the contractual interests of the DOD were being met. Only very occasionally did we encounter an exceptional individual in the SBIR PM role who actually felt it was his or her job to motivate us to thinking about Phase III - the transition to commercialization. One such person was Linda Whittington in her role as a Navy SBIR Program Manager. We quickly became good friends and I learned to listen to her advice.

Linda retired from government service earlier this year and decided to launch her own SBIR-related consulting practice to utilize her vast knowledge of the DOD's technology transition process to help SBIR companies succeed in ensuring Phase III success. She sought me out for advice on some consultancy issues, and to open discussions about collaboration with SBIR Coach clients who were seeking to deploy their technology within the DOD.

We met up at the National SBIR Conference last month, and I took the opportunity to conduct an impromptu interview for the edification of my readers:

FP: Give me a capsule summary of your Navy SBIR Program Management experience.

LW: I started as an SBIR Program Manager at the Naval Supply Systems Command (NAVSUP) in 1985 and finished my government career as the SBIR PM at the Space and Naval Warfare Systems Command (SPAWAR) in May of this year.

FP: You saw many SBIR companies over the years. What characteristic did the successful ones share?

LW: The most successful companies were open to new ways of doing business, had a business focus and a well articulated commercialization strategy. After winning an award, they kept the lines of communication open with their technical points of contact and SBIR Program offices and were proactive in the transitioning effort of the technology.

FP: Getting to Phase III (commercialization) is the goal. How did you view your role in that?

LW: I felt it was my duty to spend the tax payers’ dollars wisely and give our war fighters the technology they required. Therefore, I made it my responsibility to make other potential users inside DOD aware of technical efforts that we had funded and encourage them to leverage this technology into deployment. To make the offer even more appealing, I also offered procurement assistance to facilitate the Phase III effort for multiple users. This saved both time and money.

FP: What did you do differently from other Navy and DOD SBIR Program Managers?

LW: My goal for successful SBIR efforts was to create a win-win solution for all players. When faced with challenges that threatened that result I was tenacious in finding a solution that allowed us to move forward. More often than not, this meant taking risks, thinking out of the box and overcoming internal DOD cultural barriers. As an example, there was a requirement for an anti-terrorism effort that clearly would require more than one technology to resolve. I took the novel approach of putting together a consortium of five SBIR companies that, working together, successfully responded to the anti-terrorism requirement. DOD doesn't normally operate this way and we had significant management and procurement challenges to overcome.

FP: What advice would you give to SBIR awardees for them to be more likely to succeed at commercialization?

LW: Make your presentations high level, clear and concise. Be proactive and tenacious. Follow through and be open to new ways of doing business.

Linda recently gave me a T-Shirt that proclaims: "Without deviation from the norm ... Progress is not possible." (A quote from, of all people, Frank Zappa!) Linda's SBIR philosophy was, and continues to be, exactly this. You can see what Linda's consulting business is all about on her website: www.WhittingtonSolutions.com.

Rick Shindell sent out a new SBIR Insider Update yesterday. Here are a few of the highlights in headline form:
> Mary Landrieu (D-LA) to succeed John Kerry as Chair of the SBE Committee in the Senate
> SBIR Program Directors Vinny Schaper (DHS) and Steve Guilfoos (USAF) to retire soon
> SBA posts "Affiliation and Size Standard Rules" discussion on their website
> NIST TIP Program call for White Papers on areas of "critical national need"
> New Air Force BAA released
See the details of these items, and others, at The SBIR Gateway's Insider Newsletter page, or email me for a copy.

SBIR Coach Newsletters are now archived on the Web and available for download from my website. Subscribe for email delivery by clicking the button on the left.

Please permit me to wish everyone a very warm and fulfilling Christmas or Hanukkah celebration, and may all of us successfully withstand the the current economic turmoil and experience a prosperous New Year.
.

More SBIR Tidbits: Upcoming Deadlines, Boeing interest, SITIS, and other stuff

Everyone's taking a deep breath after last week's flurry of activity to get the NSF and NIH SBIR proposals submitted on time. I hope that everyone was able to jump through the FastLane and Grants.gov/eRA Commons hoops without hassle, although I've only rarely heard of anyone getting through the NIH submission process without having to do a corrected submission -- it's always something!

The NIH did put on a webinar with representatives from the NIH SBIR Office, Grants.gov, and the eRA Commons on-line to ostensibly allow applicants with questions to get them answered. They did a good job. I listened in and did learn some things. Evidently hundreds of questions were submitted via the on-line mechanism, but unfortunately only a very small number of them were able to be answered in the time allotted. It's clear that the NIH proposal submission system has evolved to be so complex that many find it too formidable to deal with. That's a shame. It shouldn't have to be so tough! Anyhow, the PowerPoint presentations the webinar speakers made are available for download from the NIH SBIR web page. Click HERE for a quick link to them.

Now we're into the post-Thanksgiving pre-Christmas push to get DOD, NIST, NOAA,and DHS SBIR proposals written for submission by mid-January, although my experience in dealing with proposal writers says that most will procrastinate until just before the deadline anyhow....Sigh..... DHS proposals are due Jan 5th, DOD and NOAA on Jan 14th, and NIST on Jan 22nd. NIST and NOAA require paper copies delivered by specific deadlines, while DHS and DOD have proprietary submission portal websites. All four of these agencies issue contracts or purchase orders for the work, not grants, so none of them use Grants.gov (hooray!). You should, however, have a DUNS Number and be registered in the CCR. [Remember, the SBIR Coach provides support for start-to-finish Proposal Preparation Coaching or just for Proposal Draft Reviews. Contact me if you'd like to discuss.]

Boeing has released its interest list for SBIR participation and support for the DOD 2009.1 topics. Write me if you'd like a copy. Kudos to Boeing's Rich Hendel for being the most proactive big-company SBIR supporter in the country! According to the information that Rich presented at the SBIR National Conference last month in Hartford, it's paying dividends for Boeing. Are the rest of you big-dogs paying attention?

The DOD officially opened their SBIR submission website for the 2009.1 round on December 8th, so no more communication with Topic Authors (aka TPOCs) is permitted, other than through SITIS, the official on-line system for asking questions and getting answers on the topics. My December SBIR Coach's Newsletter discusses how to use the SITIS system effectively. Write me for a copy of this one, and subscribe to future issues by clicking the "Join" button in the margin on the left of this Blog post.

Not much is happening on the SBIR re-authorization front. The current economic turmoil has everything else on hold. But, we'll turn on the heat as soon as the new Congress convenes.
.