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 statewide

network

of 15 to 20 proposal writing consultants. "While we have

successfully

offered proposal writing services in the past, we have had great

difficulty

maintaining a pool of qualified consultants," says Harmon.

"Successful

SBIR proposal writers are generally very entrepreneurial and the best

ones have little or no time for consulting."

Experienced business plan consultants, Harmon believes, could easily

be trained to help write strong SBIR proposals. "This will result

in stronger business models and business plans for the companies that

develop and submit proposals and improve the likelihood that the

technology

developed under SBIR will be commercialized," Harmon says. Gail

and Jim Greenwood of the Greenwood Consulting Group will train the

consultants and provide follow up support.

Technical marketing services are also funded by FAST.

The TCC is choosing a consulting firm to provide technical marketing

services to small sci/tech businesses. Working from the company level

up, the consultant will assess a company’s technologies and core

technical

competencies and then identify federal research programs and

laboratories

that participate in SBIR and are interested in these areas. Then the

consultant will help the entrepreneur contact the research program.

"Such networking has resulted in the generation of future SBIR

proposal topics and other collaborative agreements for the New Jersey

company," says Harmon.

Working from the government agency "down," the consultant

will try to match any future SBIR grant solicitations with the

technologies

and capabilities of firms registered in this state.

"SBIR funds are inarguably the best source of risk capital

available

to help fund the development of promising new technologies,"

summarizes

Harmon, "and it is the closest thing to `free’ money."

Even if your business is not an SBIR candidate, you can take advantage

of Harmon’s Technology Help Desk and his consulting services.

The Technology Help Desk, a toll-free telephone counseling

service, has been around for years. Call 800-432-1TEC (432-1832) to

get one-stop access to business development information, guidance

in commercializing new technologies, information on grants and

financing,

and referrals to a statewide and national resource network. "We

help clients identify and implement the steps required to take a

technology

concept and develop it into a sound business," says Harmon.

"Help

is available on an ongoing basis, at each step of the development

process."

Consulting services. The TCC’s consulting service helps

entrepreneurs launch and finance their technology-based businesses

and establish themselves in the marketplace. "As entrepreneurs

prepare to go after equity financing, the NJSBDC will review and

critique

their business plan to identify steps that they can take to strengthen

their plans, strategies and business model," says Harmon.

"This

will help them make a stronger first impression on prospective

investors

and improve their prospects of success."

Needed services might be with market entry strategy, business plans

and strategy, financing strategy and equity financing, approaching

equity investors, research and development grant proposals, financial

projections, and strategic business partnering.

In particular, he says, entrepreneurs may need help in coming up with

strong PowerPoint presentations. There’s nothing worse than poorly

planned PowerPoint.

— Barbara Fox


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