Modest SBIR investments bring big benefits.

• Author: Lundquist, Edward
• Position: Viewpoint

The defense industry is big, technologically complex and highly competitive. The bar for entry can be high. For small companies who think they have something new or different to offer, vying for a chance to compete can be daunting.

The cost and risk involved with science and technology and research and development to bring a new product or service to market can exceed the ability and resources of many small businesses. So special funding is available to help them develop their ideas and prove their technologies. Meanwhile, program managers and prime contractors have incentives to bring small companies to the table.

The Small Business Innovation Research (SBIR) program makes funding available to small companies to develop technologies to meet warfighting requirements and that can transition to a program of record and commercialization. The Small Business Technology Transfer (STTR) program is similar to SBIR, but requires the small business to formally collaborate with a research institution.

Then-Assistant Secretary of the Navy for Research, Acquisition and Development Sean Stackley said in a 2015 memo that a competitive, healthy small business industrial base is vital to the long term success and affordability of the service. "Where affordability is paramount, a strategy that includes small business creates more affordable outcomes and promotes innovation and technical advancement," he said.

Bob Smith, director of the Navy's SBIR/STTR program, said in May 2016 that the service announces topics three times a year. It issued about 170 topics in its most recent cycle. From that it received about 2,800 proposals. It reviewed, evaluated and prioritized each one, and selected two proposals for each topic. One of the two is chosen to go forward as a Phase II project. The Navy looked at 252 Phase II proposals, and selected 137 Phase III awards to help those technologies transition.

"These might seem like low numbers, but if you talk to any venture capitalist, that's a pretty good track record," Smith said.

While SBIR can help small companies introduce and develop their new technologies, Smith said companies should not focus solely on winning these awards. "Do not make SBIR your only business model. It will not work."

For Mide Technology Corp., a small business in Medford, Massachusetts, SBIR efforts have led to some surprising developments. From missile instrumentation to bulkhead shaft seals to smart wetsuits, Mide has seen SBIR grant activity...