Fletcher Richman – Hacks & Thoughts
Fletcher Richman – Hacks & Thoughts

A series of guides on hacking the boring processes in startup life.

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Electrical Engineer and Entrepreneur turned VC. Partner @ Kokopelli.vc, started Spark Boulder in college.

The hacker’s guide to government SBIR grants

Fletcher RichmanFletcher Richman

TLDR; I walk you through how to apply for $225k in initial non-dilutive grants through the NSF SBIR grants which could lead to a total of $1M in grants. I focus on helping you minimize time traversing government websites and maximizing your chance of getting a grant.

This is part three in a series of step-by-step guides to hack slow, boring processes for startups. In this post, I’ll focus on SBIR grants, one of the hidden gems in startup financing options. I’ve seen several savvy entrepreneurs receive these grants and take full advantage of them. SBIR Phase I grants can be awarded to both very early idea-stage companies, as well as smaller companies trying to develop a new product. They can be great for companies building products with high upfront development costs, allowing them to build a product before going out to raise significant dilutive capital.

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The problem is that finding and applying for the right grant is a grueling process.

I’m going to walk you through the process of applying for a grant and point you towards all the links, tips, tricks, and best practices to give you a good shot at getting it, saving you hours of wandering through government websites.

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Types of Grants

The two main government grant programs are STTR and SBIR. STTR grants aren’t relevant to most startups, they are focused products related to a University research project. I’ll be focusing on SBIR grants for this article.  SBIR Phase I proposals may be submitted for funding up to $225,000. SBIR Phase I projects run for six to twelve months. Award notification is typically four to six months from the proposal submission deadline date.

SBIR_Stages_Graphic

A variety of government organizations offer SBIR grants, but the one that applies most to startups are National Science Foundation (NSF) grants.

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NSF grants cover a wide range of topics: http://www.nsf.gov/eng/iip/sbir/topics.jsp, and even specifies that the program “accepts proposals in any area of technology” outside of the topics. You might be thinking, great, I can get a couple hundred grand to fund my AirBnB for Dogs! Not so fast, before you spend the time writing the proposal, the NSF has some guidelines about the types of proposals it is unlikely to fund:

“Proposed efforts directed toward systems studies; market research; commercial development of existing products or proven concepts; straightforward engineering design for packaging; laboratory evaluations not associated with the research and development process; incremental product or process improvements; evolutionary optimization of existing products; and evolutionary modifications to broaden the scope of an existing product or application are examples of project objectives that are not acceptable for SBIR/STTR.”

My understanding of this is that the NSF is looking to fund new inventions and products that currently are not available. The government is interested in moving technology forward, not incremental changes to exisiting solutions.

Criteria & Pre-Submission Feedback

Diving a little deeper into exaclty what the NSF is looking for, Proposals are based on two main criteria:

  1. Intellectual Merit: The potential to advance knowledge in that field.
  2. Broader Impacts: Potential to benefit society.

There’s also some examples of funded projects under each topic. If you’re not sure if you fit the criteria, don’t fret. There’s a quite an easy solution, just solicit pre-submission feedback.

2 months before submission deadline, you can: “Email a 1-2 page executive summary to an SBIR/STTR Program Director to help gauge whether a project meets the program’s intellectual merit and commercial impact criteria. The summary should discuss: the company and team; the market opportunity, value proposition, and customers; the technology/innovation; and the competition.”

(Might be a bit late for the ‘16 cycle but doesn’t hurt to send over).

Here’s a list of all of the program directors and their contact info: http://www.nsf.gov/eng/iip/sbir/contact.jsp.

Registration and application

If you’re feeling confident that your company could be a good fit for a grant, it’s time to start the application process. At least 1 month before: register for DUNS, Fastlane, SAM, SBIR Registry: http://www.nsf.gov/eng/iip/sbir/registration.jsp. (as of this writing we’re a little under a month from the deadline, so get moving!).

Once you’ve registered for all the systems, you need to complete the full application on Fastlane. Before doing that, it’s a good idea to have a draft of your answers to each section (don’t want a reload to kill all your answers).

Here’s a high level checklist of the parts of the application: http://nsf.gov/eng/iip/sbir/documents/PhaseI_ProposalCheckList_SBIR.pdf.

Screenshot 2016-05-24 12.04.00

Application Details

To better understand what is required, here is a full description of each section and the entire application: http://www.nsf.gov/pubs/2016/nsf16554/nsf16554.htm (June 2016 version, check to see if there is an updated one).

That program solicitation goes into excruciating detail, and some of it isn’t that important. Here’s a breakdown of each section linking out to the specifics of what you need to prepare to complete your proposal:

Once you’ve got those items drafted, it’s time to go through the full process on Fastlane, the NSF’s submission tool.

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Here’s a step-by-step guide on the proposal submission on Fastlane: http://www.nsf.gov/eng/iip/sbir/documents/Phase_I_Proposal_Preparation_Booklet.pdf

Final Tips & Tricks

As you’re going through writing your proposal, keep this in mind:

Masschallenge did a good post on a few other tips: http://masschallenge.org/blog/9-tips-get-sbir-funding-startups-nsf

Good luck! Let me know in the comments if there is anything I missed or any questions you have, I hope to see more great companies leveraging this resource. 

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Electrical Engineer and Entrepreneur turned VC. Partner @ Kokopelli.vc, started Spark Boulder in college.

  • Nice write-up and super helpful (even if this one is unfortunately not for us). Looking forward to your next article.

  • Sean

    I’m wondering whether C2C companies in the social space could likely fit the criteria: “Broader Impacts: Potential to benefit society” with the help from a precisely written and correctly worded application. Past examples from Phase 1 of the IT category incline me to believe the answer may be no, but it would be worth a shot. Appreciate the heads up.

    • Fletcher Richman

      Yea, I think it would take something very very compelling to get them over the edge on a social play, they are more looking for something with a technology backbone.

  • Swaminathan Venkatesan

    Do you have any templates for letter of support?