SBIR General

Q: What is NIST's SBIR Program?

A: The program consists of three phases: In Phase 1, a small business can receive up to $90,000 to establish the scientific or technical merit or feasibility of ideas that appear to have commercial potential. The successful completion of Phase 1 enables the awardee to compete for a Phase 2 contract for up to $300,000 to continue research in the same technical area. Phase 1 awardees have 6 months to complete their work; Phase 2 awardees have up to 2 years. Phase 2 is the principal R&D effort. Under Phase 3, no SBIR funds are available to pursue commercial applications of the technology.

Q: What makes a small business eligible?

A: A small business concern is one that at the time of the award (phase 1 and phase 2), meets all of the following criteria:

1. Organized for profit, with a place of business located in the United States, which operates primarily within the United States or which makes a significant contribution to the United States economy through payment of taxes or use of American products, materials or labor;

2. In the legal form of an individual proprietorship, partnership, limited liability company, corporation, joint venture, association, trust or cooperative, except that where the form is a joint venture, there can be no more than 49 percent participation by business entities in the joint venture;

3. At least 51 percent owned and controlled by one or more individuals who are citizens of, or permanent resident aliens in, the United States, or it must be a for-profit business concern that is at least 51% owned and controlled by another for-profit business concern that is at least 51% owned and controlled by one or more individuals who are citizens of, or permanent resident aliens in, the United States -- (except in the case of a joint venture);

And

4. Has, including its affiliates, not more than 500 employees. For example:

Example 1. Offeror to the SBIR Program is owned 100% by Company A. Company A is owned 100% by U.S. citizens. The offeror, or small business applying for an SBIR award, is eligible for the program because it is owned and controlled to extent greater than 51% by a business that is in turn owned by citizens of or permanent resident aliens in the United States.

Example 2. Offeror to the SBIR Program is owned 51% by U.S. citizens and permanent resident aliens of the United States and 49% by a corporation. It is eligible for the program, assuming it meets the other eligibility requirements (such as size) because 51% of the ownership rests directly with U.S. citizens and permanent resident aliens of the United States.

Q: How does a small business apply?

A: An annual program solicitation document is published containing a list of R&D topics. Applicants can choose from the research topics identified in the solicitation and submit a proposal for any topic in which they feel qualified. Proposals must adhere to the guidelines provided in the solicitation; proposals that do not comply will not be considered. Unsolicited proposals are not accepted.

Q: How are the awardees selected?

A: Each Phase 1 proposal is evaluated and numerically scored by two Agency experts familiar with the topic, according to prescribed criteria contained in the program solicitation. Selection is based on those technical scores, combined with a priority ranking provided by the laboratory management sponsoring the topic, with heavy emphasis on the probability of commercialization of the technology. The selection methodology is similar for Phase 2, and even greater emphasis is given to the commercial potential of the project.

Q: May I include in my SBIR proposal work that I intend to subcontract to a federal lab?

A: NIST will not issue an SBIR funding agreement that includes a provision for subcontracting any portion of that agreement back to NIST, to any other Federal Government agency, or to other units of the Federal Government.

Q: I have applied for a patent (or, considering to apply) on a great idea that could revolutionize my field. Will the NIST SBIR Program fund the development of this technology to bring it to market?

A: No, the R&D feasibility study Phase 1 of the SBIR Program is a required component that cannot be skipped. There are other sources of funding available to develop product from technology already established, such as: angel investors, venture capital, and loans. The SBA website provides guidance in this area.

Q: The NIST SBIR subtopic ### in the Solicitation states: "A prototype is expected at the end of phase 1..." Is it reasonable to perform a feasibility study, design and manufacture and test a prototype in 6 months with a budget of $90K without having already done most of the work?

A: Of course, the complete development of the functional system that meets all market demanded specifications is not expected to be completed in six months with a $90k budget!

The first phase, as a proving ground, provides the demonstration of a new technology by designing, building and testing a prototype. The resulting prototype from a Phase 1 effort may not have "bells and whistles." For example, it may not be hand-held, or robust, or whatever other higher-level requirement there may be. However, the Phase 1 prototype would encapsulate the innovative technologies researched during Phase 1 that are needed to overcome basic and challenging technological gaps that exist in the state of the art. Phase 2 would progress to the reduction of the demonstrated technology toward a prototype more comparable to that which would hit the market during the commercialization Phase 3.

Q: Is it permissible to re-submit a proposal rejected from the prior year's Solicitaion? One of the subtopics in this year's solicitation is similar to a topic in last year's solicitation. Maybe a resubmission with updated material would be appropriate and responsive to the current subtopic?

A: Provided it is updated to include state-of-the-art technology and addresses deficiencies that were noted in the reviewers' comments, you may resubmit. Please note that if it is essentially the same proposal, it will be returned without review. If it was deemed unacceptable once, it would meet the same fate again and will not pass the screening stage.

Q: My small business was awarded an SBIR grant by an agency other than NIST (eg DoD, NIH, NSF, ...) and I would like to work with NIST on certain aspects on that research because of NIST's unique capabilities. Will NIST provide me with technical assistance that I need?

A: NIST research labs may not be considered as a resource for general product development research in SBIR projects. SBIR funds should be spent in private sector research labs whenever possible. However, NIST research labs could be used under conditions where there is a very special piece of instrumentation/measurement/expertise not available in the private sector which may facilitate the overcoming of significant barriers in SBIR research. In such cases, a clear definition of the measurement required (i.e. what exactly has to be measured) should be identified and if the NIST resources are available, collaborative efforts may be possible. Any use of the NIST research labs should be aligned with the NIST mission of addressing new measurement needs for innovation and industrial competitiveness. In most cases, any research performed at NIST is open to the public.

If SBIR funds are to be used to fund the NIST effort, a waiver from the SBA is required. This waiver is handled through the agency that granted the SBIR funding agreement.

NIST has regular services that are available for small business and SBIR awardees. For example, the Manufacturing Extension Partnerships and Calibrations and Standards may be available.

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NIST SBIR Subtopics

Q: How do the subtopics make their way into a particular round of SBIR solicitation topics?

A: NIST SBIR has two different types of subtopics. We refer to subtopics that fall under the original guidelines as "R" or Regular topics. Our new topic categories are referred to as "SBIR-TT" topics.

Q: OK, so what are "R" subtopics?

A: "R" subtopics describe research areas that are high priority for NIST Laboratories' missions. These topics support industrially-relevant measurement science, standards, and technology. That is, during the course of their work, NIST researchers may recognize the need for a device, material, or algorithm that is not available off the shelf anywhere. The submission of an "R" subtopic in the annual SBIR solicitation is a way to encourage technology-based small businesses to both bring their innovation capability to the needs of the researchers, as well as present a case for a particular innovation's market opportunity beyond the NIST Labs.

Q: What might serve as grounds for the rejection for a proposal submitted in response to a regular subtopic?

A: "R" subtopics typically describe the end-point functionality required by the NIST research program, and as such give specifications that are needed to integrate the desired SBIR deliverable into the NIST Laboratory setting. The specifications can at times be very detailed, for example if a detector is being solicited, then the dark count, wavelength range, and sensitivity will be provided. It is understood that the solicited research will be a significant improvement on the current state-of-the-art available in the market. We expect it to be a challenge to build the specified deliverable. That's the spirit of "Innovative Research." Companies that submit proposals that offer only incremental changes to an existing fix or propose their own benchmarks of operability will not get funded. We are looking for innovative ideas with a reasonable chance of success. There is risk involved for both NIST and the proposing company: indeed the project may fail (the result does not meet spec.). Our reviewers evaluate proposals with this in mind. But, there is no penalty for failure of a good idea -- other than the fact that the hope of a new product that can be sold for profit is dashed.

We are often faced with a couple of proposals that present equally promising and novel approaches. But, we rarely make more than one award for a given subtopic 1) because of limited available funds and 2) more importantly, because of the need to avoid any potential conflicts with the confidentiality of proprietary information. In cases where we have multiple proposals of merit, we look for the one that brings more resources to bear on the project and weigh the letters of support. All other conditions being equal, we want to reward the team that is the most qualified to do the work.

Q: Now what are the new "SBIR-TT" subtopics?

A: In the SBIR-TT approach, NIST researchers identify work -- that they have published or patented -- which has potential commercial value but still requires further research. For the work to be done under the SBIR award, a company's proposal must specify the innovative research that is needed in order to push the NIST background technology closer to the marketplace.

The  "TT" subtopics include: a description of the background technology with appropriate references for more details; the research gap that prevent it from direct market adoption with all the details as would be in the "R" subtopics; and whatever NIST resources would be made available to potential proposers to support their work. This could include consultation time with the NIST researcher(s), materials, equipment, drawings, etc. It is usually the case that the NIST researchers will not engage in that research themselves because the federal government will not compete with private industry.

Q: So NIST's SBIR solicitation topics are generated on the basis of the immediate and forecasted needs of current NIST research endeavors. Or, they derive from a need to move NIST technologies into the market place via technology transfer through a for-profit small business. The SBIR-TT option sounds like an incredible opportunity for a small business that has the capacity to improve the functionality of a NIST innovation, but may not have its own intellectual property. I'm sure the SBIR-TT subtopics require a lot of back and forth communication between the companies and the topic author. What happens during the black-out period when companies are prohibited from contacting the topic authors?

A: NIST has a "brown-out" since communication is allowed through the website. We institute the communication constraints to keep the competition open and fair. If one company has the opportunity to gain special insight into what the federal agency is seeking, its motivation, or other information that is not otherwise public, they would have an unfair advantage.

Q: It seems that the drafting of solicitation subtopics (to either spin out existing technologies, or meet the current needs of NIST researchers in the lab) could cause companies to produce technologies or services available for insertion perhaps after they are actually needed by the market. Is that true?

A: The research work done at NIST and the needs which are solicited through the SBIR Program are ahead of the commercial insertion curve. For the most part, the 2-4 years that an SBIR project would take to reach maturation would generally align with market needs. It's the strategic planning of our research programs that inform the content of the research we solicit through the SBIR program.