It is also worth pointing out that CAI is a limited tool focused exclusively on commercialization. SBIR’s other objectives are not addressed. Moreover, use of the CAI omits several important economic benefits of the SBIR program that contribute to the viability, growth, and profitability of small firms. These components of value are discussed in other sections of this chapter.

Thus, while CAI is undoubtedly a useful tool, it is important that DoD—and the selection process in particular—remain aware of its limitations.

Commercialization: Conclusions

As noted in the introduction to this section, there is no single metric for identifying commercial success. Instead, multiple indicators, and multiple metrics within those indicators, are needed to develop a broad assessment of commercialization within the DoD SBIR program.

This assessment supports the view that there has been considerable effort to bring SBIR projects at DoD to the market, with some substantial success. Even though the number of spectacular commercial successes (as is typical in most early-stage research efforts) has been few, the overall commercialization effort is substantial.40

Products are coming to market and significant licensing and marketing efforts are underway for many projects. Approximately 40 percent of projects generate products or services that eventually reach the marketplace (an unusually high percentage). These data all paint a picture of a program where the commercialization objective is well understood by award recipients and by the agency.

Overall, integrating survey findings and case study narratives suggests that firm experiences under the DoD SBIR program do not appear to differ markedly from private sector firms that invest in their own R&D. Christensen and Raynor, for example, note that recent surveys of private sector R&D report: “Over 60 percent of new product efforts are scuttled before they ever reach the market, and of the 40 percent that do see the light of day, 40 percent fail to become profitable and are withdrawn from the market.”41

This approximate benchmark puts an even more positive light on DoD SBIR commercialization outcomes, since private sector R&D is typically weighted far more to product development than to the science and technology activities (6.1–6.3) within the DoD SBIR portfolio; thus private sector R&D should be expected to produce comparatively higher success rates.

However, as we shall see in Chapters 5 and 6, there are still considerable barriers to SBIR awardees achieving success within the DoD acquisition system itself—which represents an area of significant potential improvement.


The distortion is echoed in venture and angel investments, both of which are often downstream of SBIR, which normally makes earlier-stage investments.


C. Christensen and M. Raynor, Innovator’s Solution, Boston, MA: Harvard Business School, 2003, p. 73.

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