Corrections or additions?
This article by Barbara Fox was prepared for the
November 28, 2001 edition of U.S. 1 Newspaper. All rights
reserved.
For Small Business, Free (Almost) Money
If you have a technology business, your best chance
at getting “almost free” money is through the Small Business
Innovation Research (SBIR) program. It is the federal government’s
largest R&D grants program targeted to the small business community,
says Randy Harmon, director of the Technology Commercialization
Center, part of the New Jersey Small Business Development Center
(NJSBDC)
of Rutgers Graduate School of Management.
Princeton Multimedia Technologies on Witherspoon Street, Discovery
Semiconductors on Princeton-Hightstown Road, and Vectramed Inc. on
Plainsboro Road are among the Princeton area firms that have taken
advantage of these SBIR grants.
Aiming to help New Jersey’s high tech businesses get more SBIR money,
the federal Small Business Administration (SBA) gave the Technology
Commercialization Center (TCC) $100,000 under the Federal and State
Technology (FAST) program. With this and a matching amount from the
New Jersey Commission on Science and Technology, TCC is staging
statewide
training programs focused on different aspects of the grant process.
The first training is set for Wednesday and Thursday, December 12
and 13, at the Rutgers Fiber Optic Materials Research Center in
Piscataway.
The topics will be Phase I proposal development and cost proposal
preparation. The final program, on Tuesday, February 5, will cover
Phase II SBIR proposals. Cost: $60 per day or $95 for two days. Call
973-353-1923 (or E-mail: scitech@yourbizpartner.com).
“The odds for the SBIR grants are very good,” says Harmon,
“one in eight for Phase I and two in five for Phase II. Under
Phase 1 you can get up to $100,000 for `proof of concept’ work. For
Phase II, some agencies go up as high as $750,000 for proof of concept
and developing a prototype.
The first workshop on proposal writing will cover both SBIR and Small
Business Technology Transfer (STTR) grants. STTR funds often work
better for academic researchers who can’t meet the SBIR requirement
that the principal investigator spend at least 50 percent of his or
her time on the grant project. Nevertheless, STTR grants have the
unusual requirement that 30 percent of the funds must go for a
collaboration
with a nonprofit institution.
The STTR program is the poor sister of SBIR, Harmon says. Nationally,
STTR funds amount to only $60 million compared to the $1 billion SBIR
treasure chest. In contrast, STTR grant monies cap at $500,000.
“But
you can get an awful lot of development done and get the technology
to the point where you are limiting more and more risk, so it is a
great prospect for equity financing,” says Harmon. “In today’s
economic environment, this program becomes even more significant.”
At the second workshop, entrepreneurs will learn how to avoid an
audit.
Those who fail to follow through on the fine print of their proposals
could be penalized for charging the government too much — or
failing
to justify an expenditure. They will also learn about the cost
proposal
and government accounting requirements.
The FAST workshop sponsors include the NJSBDC (which operates in
partnership
with the federal SBA and the New Jersey Commerce and Economic Growth
Commission), the New Jersey Commission on Science and Technology,
and Rutgers Graduate School of Management. Hale and Doerr is the
exclusive
law firm sponsor.
Harmon majored in industrial labor relations at Cornell,
Class of 1975, and has an MBA from Rutgers. Most recently, he headed
the Technology Help Desk at the Rutgers business incubator in New
Brunswick. After six years in charge of the incubator there, he left
to open TCC at the New Jersey Small Business Development Center at
43 Bleeker Street in Newark.
“Over the last few years I have been serving more businesses
outside
the incubator than inside,” says Harmon. “We decided last
spring to launch the Technology Commercialization Center, and I moved
up to Newark about four weeks ago.” He administers these
additional
services funded by FAST monies:
Program consultants. The TCC is training a statewidenetworkof 15 to 20 proposal writing consultants. “While we havesuccessfullyoffered proposal writing services in the past, we have had greatdifficultymaintaining a pool of qualified consultants,” says Harmon.”SuccessfulSBIR proposal writers are generally very entrepreneurial and the bestones have little or no time for consulting.”Experienced business plan consultants, Harmon believes, could easilybe trained to help write strong SBIR proposals. “This will resultin stronger business models and business plans for the companies thatdevelop and submit proposals and improve the likelihood that thetechnologydeveloped under SBIR will be commercialized,” Harmon says. Gailand Jim Greenwood of the Greenwood Consulting Group will train theconsultants and provide follow up support.Technical marketing services are also funded by FAST.The TCC is choosing a consulting firm to provide technical marketingservices to small sci/tech businesses. Working from the company levelup, the consultant will assess a company’s technologies and coretechnicalcompetencies and then identify federal research programs andlaboratoriesthat participate in SBIR and are interested in these areas. Then theconsultant will help the entrepreneur contact the research program.”Such networking has resulted in the generation of future SBIRproposal topics and other collaborative agreements for the New Jerseycompany,” says Harmon.Working from the government agency “down,” the consultantwill try to match any future SBIR grant solicitations with thetechnologiesand capabilities of firms registered in this state.”SBIR funds are inarguably the best source of risk capitalavailableto help fund the development of promising new technologies,”summarizesHarmon, “and it is the closest thing to `free’ money.”Even if your business is not an SBIR candidate, you can take advantageof Harmon’s Technology Help Desk and his consulting services.The Technology Help Desk, a toll-free telephone counselingservice, has been around for years. Call 800-432-1TEC (432-1832) toget one-stop access to business development information, guidancein commercializing new technologies, information on grants andfinancing,and referrals to a statewide and national resource network. “Wehelp clients identify and implement the steps required to take atechnologyconcept and develop it into a sound business,” says Harmon.”Helpis available on an ongoing basis, at each step of the developmentprocess.”Consulting services. The TCC’s consulting service helpsentrepreneurs launch and finance their technology-based businessesand establish themselves in the marketplace. “As entrepreneursprepare to go after equity financing, the NJSBDC will review andcritiquetheir business plan to identify steps that they can take to strengthentheir plans, strategies and business model,” says Harmon.”Thiswill help them make a stronger first impression on prospectiveinvestorsand improve their prospects of success.”Needed services might be with market entry strategy, business plansand strategy, financing strategy and equity financing, approachingequity investors, research and development grant proposals, financialprojections, and strategic business partnering.In particular, he says, entrepreneurs may need help in coming up withstrong PowerPoint presentations. There’s nothing worse than poorlyplanned PowerPoint.— Barbara FoxPrevious StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
