Back from the SBIR

I just returned from a three-day conference for the Small Business Innovation and Research community. These are held roughly twice each year, on opposite sides of the country. You might ask yourself, apart from the many university scientists who participate in the conference what the relevance is to the non-profit/NGO world. In short, these people get grants, lots of grants. How much? Phase I grants are usually $100,000 for a six month project. Phase II grants are $750,000, awarded usually for two years.

SBIR is a sort of “set-aside” of 2.5% of all US federal grants that are awarded to outside contractors and researchers. This 2.5%, which this year includes more than two billion US dollars, has to be spent with “small businesses”. Awards are made by 11 U.S. federal agencies, including the National Institutes of Health, DOD (including Army, Navy, Air Force, DARPA), Department of Transportation, U.S. Department of Agriculture, National Science Foundation, etc. (By the way, the money being awarded is your money, federal taxpayer’s money.) So, you too, can be like Halliburton and Lockheed Martin, and receive federal largesse!

Actually, maybe you can’t. This program is for businesses, not non-profits. However, you can use a small business as a partner for a grant. This is exactly what happened in my case; I was a approached by a university researcher (the non-profit) to apply for an SBIR Phase I grant which we then jointly used for our telemedicine/videoconferencing project.

Not only are the grant applicants at the conference…and you might imagine how useful it is to compare notes with, say, a hundred other people like yourself who are applying for similar grants…but the grant givers present most of the conference sessions. So, in effect, the grant makers are telling you how to get their money. There are lots of discussion about what is required for a successful grant application. There are also lots of discussions of what didn’t work. Among the tips:

  • Have a “portfolio” of grants with different start and end dates to level the fluctuations of revenue, and spread out the work of application, record-keeping, and compliance.
  • Structure your grant as a project with outcomes.
  • Do pre and post testing of the project subjects and be able to state outcomes with data.
  • Follow the grant submission instructions, including font size and style, page lengths, specifications for attachements and so on. (This seems patently obvious…but apparently it is a real problem, even with the SBIR crowd.)
  • Use graphics in the presentation to encapsulate the essence of a project in an understandable form.
  • Put yourself in the reviewer’s shoes. Make the grant application easy to read. Several grant reviewers stated unequivocally that because of the volume of submissions, they look for any excuse to reject an application without having to read it, and formatting problems are an easy way to be able to quickly reject something.
  • Get to know the personnel at the grant agency or foundation. Schmooze! Find out who the relevant people are at the foundation or agency and talk to them as you are working on the application.
  • Keep in touch with the program officer at your granting foundation during the term of the grant. Appraise them in any change of scope of work. Avoid surprises.
  • Grant budgets include direct expenses; money that is spent on items and services directly related to fufilling the grant objectives, and indirect expenses; money that is spent as the cost of doing business, such as office expenses, heat, utilities, etc. Grantor agencies may or may not allow you to charge indirect expenses to the grant…but you do have to be able to account for those expenses. Enlightened grant-givers will allow you to charge a portion of your indirect to the grant and they will acknowledge these expenses. They will be suspicious if you don’t account for the indirect expenses.
  • You can’t be naive about accounting. QuickBooks by itself may not be the best solution for grant accounting. You need to be able to report all the financials by grant, as well as your consolicated financials.
    Accounting for management information purposes, may or may not be the same kind of accounting for financial purposes, and your system(s) need to be able to do both.

Related to the indirect expense issue, granting agencies and foundations are interested in your success as an organization. Your application should reflect your past successes, and your ability to keep your organization healthy. You need to demonstrate capability to follow through and execute the work plan. Such evidence can include things like:

  • Letters from third parties, collaborators and clients
  • Matching funds in-kind or in cash
  • Letters demonstrating community support
  • Experienced staff managing the project
  • Contributions to journals, conferences, and associations

So, it is a bit of a sales job. You have to demonstrate credibility and capability.
Anyway, if you have the opportunity to attend an event like this I recommend it. I was even able to get a grant for the conference expenses. 🙂

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