Workshops teach ABCs of getting SBIR grants
BYLINE: CAROLYN DUFFY MARSAN STAR CORRESPONDENT
Eyeing a multibillion-dollar prize, Indiana is stepping up its efforts to attract federal research grants for small businesses.
The Indiana Economic Development Corp. is hosting a series of workshops this week to teach entrepreneurs how to write research proposals to federal agencies for funding.
Grant writing isn't so easy.
The Mek Group, a Carmel marketing firm, has submitted a Small Business Innovation Research proposal to the Department of Agriculture to develop software for rural economic development officials. The application, the company's first, took 200 hours to prepare.
"If we're successful in getting a Phase 1 SBIR grant to develop our prototype and a Phase II grant for commercialization, in 36 to 48 months we could have a $10 million software division," says Michael A. Snyder, a principal with The Mek Group. The Carmel company offers marketing consulting services.
In 2004, 35 Indiana small businesses received $12.6 million in SBIR grants. That amounts to less than 1 percent of the more than $2 billion in SBIR funds available nationwide.
Indiana ranked 26th out of 50 states in SBIR grants, behind Midwestern peers Ohio, Michigan, Illinois and Wisconsin.
"Our number should be higher," says Brooke Pyne, SBIR program manager with the IEDC.
"A lot of it is due to the lack of education and awareness across the state," Pyne said. "We're trying to not only educate entrepreneurs about the SBIR process in general, but . . . we're trying to help them navigate the process."
The IEDC wants to double the number of SBIR grant proposals and awards tied to Indiana companies.
Through the SBIR program, companies with fewer than 500 employees can get up to $100,000 to fund technological innovation. Follow-on awards are available for up to $750,000 to commercialize an idea.
"What we're looking at in these grants is high-risk R&D that you might not be able to get funded by anyone other than the federal government," Pyne says. "It's a win-win for the entrepreneur because it's not a loan, so there's no repayment."
A companion program offers Small Business Technology Transfer grants to startups that partner with universities and federal labs on research and development projects.
Six federal agencies participate in the STTR program and the awards are up to $100,000 for the initial research phase and up to $500,000 for the commercialization phase.
The IEDC workshops cover how to write successful SBIR and STTR proposals. The workshops cost $25.
Getting an SBIR grant isn't easy. The forms must be filled out precisely, and each agency has its own priorities for making awards.
Proponents say SBIR grants are worth the effort because they validate an entrepreneur's idea. Winning an SBIR grant also means that a federal agency is interested in buying products based on the research.
Information In Place., a Bloomington developer of instructional software and hardware, got its initial funding in 1999 through an SBIR grant from the Coast Guard. Since then, the company has received seven Phase 1 SBIR awards and four Phase 2 SBIR awards for total federal funding of around $3 million.
"SBIR grants have been absolutely essential to us," says Jonathan Schalliol, vice president of business development and chief financial officer of Information In Place. "This company would not exist if it were not for those contracts."
Today, the company has 16 employees and revenue of more than $1 million per year. It is shipping its first commercial products to two manufacturing facilities in Northern Indiana. "We will continue to develop our technology road map through SBIRs," Schalliol says.
Local startups get an extra boost because Indiana matches initial SBIR and STTR grants through its Indiana 21st Century Research and Technology Fund. Entrepreneurs can use the Indiana matching grants to protect intellectual property and to fund ongoing operations between initial and follow-on SBIR grants.
The Mek Group will find out about its $75,000 grant proposal by the end of the year. If it is approved, the company actually will receive double that amount, or $150,000, because of the state matching grant, said Snyder, the company's president.
"These grants are transformational in nature, particularly the way the state matches the Phase 1 grant,'' he said. "The SBIR program enables you to invest the money you need to create truly innovative product with almost no risk."
___________________
Grant workshops
Here's the schedule for this week's SBIR Phase I Proposal Preparation Workshops hosted by the Indiana Economic Development Corp. The cost to attend is $25.
Tuesday at the Radisson Hotel at Star Plaza, Merrillville.
Wednesday at the Innovation Center of Northeast Indiana, Fort Wayne.
Thursday at the University Place Conference Center, Indiana University-Purdue University Indianapolis.
Nov. 28, French Lick Resorts, French Lick.