The American government encourages startups to commercialize R&D projects

By April 25, 2013 Drop a comment
hands that hold the letters R and D

The United States Small Business Innovation Research (SBIR) program provides grant funding to help small businesses on the way towards marketing the fruits of their R&D.

 

One of the problems facing developed economies these days is the low transformation rate of scientific discoveries and Research & Development projects into real commercial ventures that can be rolled out to a mass market. In some specific ecosystems such as Silicon Valley, where major universities such as Stanford cohabit with a wide spectrum of startups, transforming R&D excellence into business can go relatively smoothly. This virtuous circle encompassing the two complementary worlds is unfortunately not the rule everywhere, and many projects lie dormant for want of financial backing. This is why the US government set up the federal SBIR program whose purpose is to help small businesses transform their scientific breakthroughs into marketable products and services.

Three stages of development

The program, which is financed from the federal budget, is implemented at State level, with periodic sollicitations for proposals requesting funding throughout the year. The criteria for eligibility for SBIR funding are: companies must be independent and owned by US citizens; they must be for-profit; the lead researcher on the technology which the project is developing must be a contractual employee; and the firm can have a maximum of 500 employees. The required financing will take place in three stages. Firstly, federal funding is granted to a company to undertake research into how it will go about commercializing its technology. Subsequently, an additional sum will be allocated to enable the actual development. Thereafter, the company ought to be in a position to push ahead with marketing the technology and at this stage it will need to find funding independent of the SBIR program.

Turning scientific excellence into profitable business

The SBIR program has four stated main objectives: first and foremost to spur technological innovation in the small business sector; secondly, to meet the research and development needs of the federal government; thirdly, to encourage people from socially and financially disadvantaged backgrounds to get involved in innovative and entrepreneurial projects; and last but not least to improve overall private sector commercialization of federally funded investments. Among the projects that have recently received SBIR funding is New Jersey-based CytoSorbents, which has developed a blood purification filter mechanism for treating life-threatening conditions arising from infections, septicemia or toxicity. A number of federal agencies from different fields participate in the program, ranging from defense and energy to healthcare.

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