An Assessment of the SBIR Program at the National Science Foundation

to attend a commercialization planning workshop. Since 2001, it has engaged the services of Dawnbreaker, Inc., a company that specializes in providing commercialization assistance to small advanced technology firms, to help Phase I grantees to prepare NSF’s required commercialization plan for Phase II submissions.³ In addition, the NSF’s SBIR program has encouraged commercialization at the Phase II stage by offering its Phase IIB supplemental option, conditioned on the grantee obtaining third-party financing. The Phase IIB supplement stands out as an innovative method of encouraging companies to attract funding from other sources—a critical step toward commercialization. The development and enhancement of the NSF’s Web-based Matchmaker program to promote partnering may also encourage commercialization.

The NSF’s SBIR program is using Phase IIB Supplemental Grants as an innovative method of encouraging companies to attract funding from other sources, which

provides an incentive for firms to partner with the investment community,
can identify technologies with greater market potential, and
helps bridge the funding gap to commercialization.

Management of NSF’s SBIR, the Office of Industrial Innovation (OII), has taken another recent step to provide more commercialization assistance to its Phase II grantees. The NSF’s SBIR program entered into a partnership with the Department of Energy’s (DoE) SBIR program to jointly sponsor the 2005 DoE Opportunity Forum.⁴ This forum brought selected SBIR grantees face-to-face with prospective investors and allowed them to present their commercialization opportunities to the investors.

In addition to the 2005 DoE Opportunity Forum, OII brings together Phase II grantees on a regular basis at its annual grantee conferences. For example, OII cosponsored a Phase II Grantee Conference on May 18–20, 2006, in Louisville, Kentucky, with the Ewing Marion Kauffman Foundation, a Kansas City-based

According to Dawnbreaker, Inc., it is difficult to give extensive attention to business planning during Phase I, despite the fact that early business planning is desirable. Factors limiting what can be done include the following: the short time duration of Phase I; the fact that small-company resources are generally tight during this phase; the difficulty of attracting external funding during this early phase; and limits on available funding for commercialization assistance through the SBIR program.

⁴

The 2005 DoE Opportunity Forum brochure, “Partnering and Investment Opportunities for the Future.” The forum took place on October 24–25, 2005, in Tysons Corner, Virginia.

Table of Contents

Front Matter R1-R20

Summary 1-11

1 Introduction 12-20

2 Findings and Recommendations 21-40

3 Scope and Methodology 41-46

4 Overview of the NSF SBIR Program 47-82

5 Commercialization 83-119

6 Support to Agency Mission and to Small Business 120-124

7 Contributions to Knowledge 125-135

8 Program Management 136-188

Appendix A: NSF SBIR Program Data 189-204

Appendix B: NRC Phase II Survey and NRC Firm Survey 205-230

Appendix C: NRC Phase I Survey 231-239

Appendix D: Selected Case Studies 240-325

Appendix E: Structured Interview Guide Used in Coryell Study of Phase IIB Grants 326-334

Appendix F: Required NSF Postgrant Annual Commercialization Report (Deemed Ineffective by the NSF) 335-336

Appendix G: Bibliography 337-346