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5 reasons to stop sleeping on the SBIR grant program

G. Nagesh Rao, chief technologist at the U.S. Small Business Administration, wants to open your eyes to the power of “America's Seed Fund.”

Government grants can power cool innovation, too. (Photo by Flickr user Phil Roeder, used under a Creative Commons license)

G. Nagesh Rao — chief technologist at the U.S. Small Business Administration, where he advises on the Small Business Innovation Research (SBIR) grant and contract program — is energetic, enthusiastic and opinionated. All of which is complemented by his impressive resume: He’s got a background in engineering and has worked across both the private and public sectors. He was a 2016 Eisenhower Fellow, and spent time in both Vietnam and Sri Lanka over the past year advising both countries how to bring a SBIR-like program to life.

It's one of the best kept secrets and we don't want it to be a secret.

Rao has been working with the SBA for three years now, and he still gets really excited when talking about the kind of investments the SBIR program makes. The Roomba vacuum? That tech was initially developed via a SBIR grant. And many of the component pieces inside your iPhone? Same.
The SBIR program, which brands itself as “America’s Seed Fund,” is all about fostering American entrepreneurship. Investment in far-fetched ideas encourages research which could, down the line, yield innovations for use in the federal government or even as a commercial product. It’s classic tech transfer.
But despite the cool innovations coming out of SBIR funding, Rao is always looking to spread the word about the grants available to new and diverse entrepreneurs. Given this, here are five things he’d like entrepreneurs to know about the SBIR program:

1. It exists!
  • All told, federal agencies give out about $2.5 billion per year via SBIR grants and contracts. And yeah, a grant means that the government takes no equity — rather they’re making a long-term investment in the idea that a successful, innovative business will be worth a bunch in taxes down the line. “It’s one of the best kept secrets and we don’t want it to be a secret,” Rao said.
2. If at first you don’t succeed, try, try again.
  • Every year, the 11 federal agencies that participate in the SBIR program publish different funding opportunities. Some, often from the National Science Foundation, for example, are very broad prompts, while others (NASA prompts are a good example of this) very specifically lay out expectations. Find the opportunity that fits best for your innovation and your company.
3. Use your resources.
  • should be your best friend if you’re looking to apply for a grant. The site has tutorials on how to apply, info on all the current and coming opportunities and more. Program managers are also available to talk about your application, Rao said, but be sure to do your homework before you give them a call.
4. The SBIR program is all about making long-term bets.
  • Got a big, complicated idea that won’t immediately yield return on investment but could be important down the line? This is precisely the kind of thing SBIR grants are great for. For example ZMapp, the Ebola drug deployed during the outbreak in 2014, received SBIR funding back in 2007 or 2008. “We take the bets on the crazy kids that the private sector won’t,” Rao said.
5. Really. We’re talking big, huge ideas here.
  • SBIR grants are about advancing tech, not just creating the next Facebook. Not that Rao has anything against private-sector tech, but he does seem somewhat miffed that traditional venture capitalists get all the credit for investing in cool stuff when it’s really the SBIR program (to his mind) that is making the most revolutionary bets. “I get it. Uncle Sam’s not cool,” Rao said. But from his perspective overseeing how our proverbial uncle is driving innovation, that’s just not the case.
Companies: U.S. Small Business Administration

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