Phase I SBIR Grants

We have previously written about SBIR Grants and the benefits receiving one could pay

to your business. There are three phases to an SBIR Grant, and the phase that will likely benefit your small business the most is Phase I. We’ll provide a comprehensive guide to Phase I grants here.

Business Requirements

Before beginning the application process, you must make sure that your small business

meets the SBIR requirements. These are not especially stringent requirements, and are mainly looking to ensure that you’re fully committed to your business and that you and any partners have a strong desire to grow your business. The full list can be found here.

Which Agencies Should You Apply to?

There are 14 different government agencies that you can apply for an SBIR to, and the

burden of deciding which ones are appropriate for your innovation falls to you. These agencies include the Department of Agriculture, two chambers of the Department of Commerce, the Department of Defense, the Department of Education, the Department of Energy, the Department of Health and Human Services, the Department of Homeland Security, the Department of Transportation, the Environmental Protection Agency, NASA, and the National Science Foundation.

Review Process

After you’ve verified that your business meets the requirements and have submitted your

application, the NIH Center for Scientific Review will process your application. The application

is judged on a dual peer review system that filters out most applications. After this, the

application is reviewed again by the advisory council of the government agency you submit your application to. The director of that program will then make the final call whether or not to fund your innovation. Results will vary from year to year, but from 2012-2016, the funding rate ranged between 13 and 30 percent.

The typical SBIR Phase I grant lasts no longer than 6 months, and grants no more

funding than $150,000. However, this money cannot be spent indiscriminately for whatever need you foresee for your business. The NIH puts certain restrictions into place to ensure that the money is spent wisely, and provides resources for you to understand these restrictions and decide where to allocate the grant to put it towards the best use.

Moving Forward

After you’ve made use of your Phase I grant, you have the option of continuing on to

Phase II of the SBIR process, or running your company without government grants. It’s worth

nothing here that Phase II grants are somewhat easier to attain than Phase I grants-the funding rate varies from 30 percent to 54 percent-but it can also be a long process to apply, receive funding, and comply with government requirements. Whichever direction you end up taking your business, remember that government resources-even things as simple as online guides and advice-are always available to help you as you move forward and commercialize your innovation.