For startups and small businesses in STEM fields, the Small Business Innovation Research (SBIR) program is a little-known funding resource with the power to propel early-stage research efforts to full potential.
Formed in 1984 as part of the U.S. Small Business Administration, the purpose of the SBIR is job creation and commercialization.
Around the time the program was formed, universities were claiming that for every $2 million given to research, they could create a patent.
“For less money, we create jobs,” said Gary Archamboult, program director for South Dakota’s SBIR branch.
Functioning as a bridge between university funding, basic research, and technology commercialization, the program mandates that all federal agencies with extramural research and development (R&D) budgets of over $100 million must set aside 3.2 percent for SBIR programs.
At this time, eleven agencies are involved:
- Department of Agriculture
- Department of Commerce
- National Institute of Standards and Technology
- National Oceanic and Atmospheric Administration
- Department of Defense
- Department of Education
- Department of Energy
- Department of Health and Human Services
- Department of Homeland Security
- Department of Transportation
- Environmental Protection Agency
- National Aeronautics and Space Administration
- National Science Foundation
Some are larger players than others, says Archamboult. For instance, the contribution from the Department of Defense (DOD) makes up about 50 percent of the SBIR’s overall funding, and the Department of Health and Human Services covers about 40 percent.
While some of the funding functions similarly to a grant, the DOD works only in contracts, where the end goal is always to purchase the developed technology.
However, all funding received through the SBIR is non-dilutive, meaning no equity is lost and nothing is owed beyond the completed research. For students, researchers, and small businesses just starting out, this is incredibly valuable.
“My SBIR clients aren’t bankable, because they aren’t producing a product yet. It’s really hard to get an investor interested until you have a prototype and a proof of concept,” Archamboult said. “This is early-stage funding for tech projects that gets them ready for investor funding.”
How to Get Started
For the South Dakota branch, Archamboult exists as a liaison between researchers and agencies, available to assist at any stage in the application process.
“This is not a simple program,” he said.
Most proposals are technical in nature, but Archamboult says he’s seen almost everything imaginable during his time with the SBIR.
“The main focus for South Dakota has really been healthcare, but I see everything from advanced manufacturing to software that assists in county road maintenance,” he said. “There’s virtually nothing you could be researching that isn’t covered by the federal agencies.”
Archamboult can help with everything from refining a research concept to proposal writing and submitting applications.
“I’ve taken people and said, ‘Here’s what they’ve funded in the past. You have to propose something different than what’s already been funded,’” he said.
According to Archamboult, doing your homework on the different agencies and their solicitation processes is key to submitting a successful bid. Every agency operates differently and has specific timelines and requirements for submissions.
Additionally, visiting the SBIR office for assistance is shown to increase a proposal’s odds at success, he says.
“I’m not afraid to tell you, ‘They won’t fund this,’” Archamboult said.
Throughout the year, he hosts several events across the state, including informational seminars or proposal workshops. Interested people should email Archamboult to sign up for his monthly SBIR newsletter with up-to-date event information.
Last month, Archamboult hosted the SBIR Road Tour at the University Center.
The day-long event brought in representatives from each of the eleven agencies and gave attendees the opportunity to present a quad chart highlighting the technology, application, cost, and development of their research concepts. After these presentations, they were able to request one-on-one meetings with the agency representatives.
Events like the Road Tour are just one of the many ways Archamboult seeks to spread the word about the SBIR in both the university and business communities.
“We want students to understand that this money is out there,” he said. “I go and talk to different classes, and we also wrote a grant to give $2000.00 to each campus to hold a business plan competition.”
All of the resources and services offered through the SBIR are free of charge.
“We’re trying to create an ecosystem of business development support,” Archamboult said.
Archamboult travels regularly across the state and is available via phone or email, but he says face-to-face meetings are always preferable. His office is located within the Small Business Development Center (SBDC) at 2329 N Career Ave., Suite 106, Sioux Falls, SD 57107.
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