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Comment by matchagaucho | Hacker News Reader

Note: I've applied for SIBR funding in the past. Huge waste of time.

"The catch" Application process takes several months

Similar to an RFP, by the time a SIBR request is written, the preferred vendor has already been chosen.

Government agency usually gets perpetual use license of your product.

Pros: Received an actual written response (months later) with detailed rejection reasons. Something a VC would never do.

For DoD projects and vendors with TS clearances, a SIBR contract can be parlayed into 5-10 year deals.

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> Note: I've applied for SIBR funding in the past. Huge waste of time. Similar to an RFP, by the time a SIBR request is written, the preferred vendor has already been chosen.

This is misinformation. SBIR funding is the #1 source of early-stage funding for certain industries. Any startup developing a life-saving medicine or medical device is using SBIR for things like clinical trials. "The preferred vendor has already been chosen" is utter nonsense; it's like saying the government has already decided which drug is going to work.

To be effective at applying for SBIR grants you do need a good program officer. They will let you know whether it's worth spending the time to apply.

I’m a panel reviewer for NSF SBIR and the comment about a “preferred vendor already being chosen” is absolutely not true. In fact, firms that have been funded for years by govt grants are at a disadvantage compared to “true” startups.

IIRC to qualify for SIBR a startup must have annual revenue < $10M (?) which excludes larger vendors.

Anyway, a better wording may be "vendors in specific geographies with specialized skills".

The process is not as open as it appears. There is a strong bias for specialization.

Open a new "unrelated" subsidiary. Happens all the time.

I've found a couple of SBIR/STTR RFPs while I was responding to another question, and the ones I've found read:

Has, including its affiliates, not more than 500 employees and meets the other regulatory requirements found in 13 CFR 121.

That's from a DOE SBIR/STTR Phase I application.

hmm only less than 500 employees. Sounds legit.

Wrong. I could tell you stories Buddy, you would not believe. I could complain, but this could easily backfire and could get me and people who benefited from SBIR grants, into trouble. So no, nothing happened and I just dreamed this up when I was smoked up.

I just submitted another SBIR application. Not a really happy about would I delivered in the application, but in the end, to use the words of two of my friends who got an SBIR I +II "It is not an open race". Unfortunately. So the other option is to get funded for the project is China. They shit you with money there if you bring tech.

The SBIR process is based on solicitations. Each solicitation is associated with its own instigators, and there are also a multitude of USGov entities that participate in the program. It's entirely possible for what you experienced to be true and also for other solicitation processes to have been conducted as ethically as one would hope.

> Government agency usually gets perpetual use license of your product.

Misleading. The agency, in this case NSF, obtains march in rights for patents (not data) developed using funds received from them. They will only exercise that right in the most extraordinary circumstance. Basically, if you develop a cure to cancer and then decide not to commercialize it or make it publicly available, they may exercise march in rights and take it over. No agency, not even the DoD, has ever exercised it, to my knowledge.

You're competing against shops who make it their bread and butter to do tons of SBIR. So if you don't plan ahead and have the right connections/know-how, you're at a significant disadvantage there.

"Pros: Received an actual written response (months later) with detailed rejection reasons"

Yes, this may be indeed helpful. But many reviewers browse your application only. Let me phrase it this way: An idiot and google is a very dangerous combination. He gave an argument about costs and was basically two magnitudes off. And I explicitly wrote that is mass produced (10k units) this item would not cost 50k but 300-500 US$ per Unit. But yes, he googled it and found that a single unit with many features would cost 50k US$.

Its a Government agency, so it moves pretty slowly.

I've seen these programs used by existing businesses to secure funding to work on research-y stuff which would be hard to justify for a small business. My impression of it is that its a pretty amazing program for the right audience.

It may also depend on your company. I have written a bunch of SBIRs (http://seliger.com/Should-your-startup-seek-Small-Business-I...), and, for hard tech companies, they may be more desirable than for other kinds of companies.

The time involved and bureaucracy is true.

Government agency usually gets perpetual use license of your product.

Is that true for non-STTR applications? I'm doing some command-f through some old SBIR RFPs and am not finding the language (could be there). I am finding language like this:

Copyrights—The grantee may copyright and publish (consistent with appropriate national security considerations, if any) material developed with DOE support. DOE receives a royalty-free license for the Federal government and requires that each publication contain an appropriate acknowledgment and disclaimer statement.

But that's for a copyright to a publication.

Also, this applies to patents, not to the product itself:

Patents—Grantee may retain the principal worldwide patent rights to any invention developed with Federal support. The government receives a royalty-free license for Federal use, reserves the right to require the patent holder to license others in certain circumstances, and requires that anyone exclusively licensed to sell must normally manufacture it domestically. Information regarding patent rights in inventions supported by Federal funding can be found in the Code of Federal Regulations, 37 CFR 401.

As I said, I'm not sure that you're correct, but the statement does not jibe with my immediate memory.

Great writeup. Thanks for sharing.

For the particular SBIR I applied for 15 years ago, I recall having to accept a perpetual licensing outcome that capped the license profit margins to 10%-20% actual costs. Maybe that's changed.

It seemed like a fair deal. The gov funds the R&D, they of course want returns.

Wow, I had the exact same experience. Would never bother with it again.

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