Millions of dollars in federal research grants are available for small and early-stage technology companies in Minnesota. They just have to know how to ask.
Starting Tuesday, the Minnesota High Tech Association (MHTA) will be accepting applications for its new accelerator program, which will coach dozens of small-tech firms and entrepreneurs on how to successfully apply for grant funding from the highly competitive Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs.
The MHTA accelerator program aims to enroll 120 companies in 10 program groups in 2020, starting with the inaugural class of 12 companies that will receive guidance on seeking grants from the many entities under the National Institutes of Health. The deadline to apply is Oct. 15, and the coursework runs Oct. 24 to Jan. 6. The free program includes in-person training sessions augmented by “a personalized and customized approach” for each company, MHTA said. The schedule for the future classes is still being determined.
No one is required to attend an accelerator class to apply for an SBIR or STTR grant. But the programs are highly competitive, and some companies have to apply multiple times before securing an award. The high-tech association is receiving state and federal funding to run its accelerator class.
Together, SBIR and STTR dole out roughly $3.7 billion in grants to more than 5,000 companies annually in fields ranging from medical technology and biotech to defense, energy and education. The broad goal is to use the funding to cut down the time from development to commercialization for “high-impact” innovations by issuing grants for research and development efforts to address early technical hurdles.
In the decades since the grant programs were started, Minnesota firms have won more than $700 million in funding, which has led to further private investments, new products and services, and acquisitions and initial public offerings of stock. Past recipients include nanotechnology firm NVE Corp., gene engineering firm B-MoGen Biotechnologies (now owned by Bio-Techne), and digital security and engineering firm Adventium Labs. Med-tech startup Quench Medical recently won $224,000 in Phase 1 funding for its asthma-medicine delivery platform.
This year, the new Minnesota accelerator program aims to specifically invite 40 of its 120 companies to take part, with a goal of obtaining funding for 10 of the 40 invited companies. Any project in the grant program can be accepted for up to $5 million over five years, in three phases.
“It’s a great source of nondilutive funding,” said Pat Dillon, director of the MHTA’s Minnesota SBIR/STTR Assistance Office in the Minneapolis Grain Exchange Building. Federal grantmakers “are not going to take a piece of the company. ... And it’s not a loan.”
The grants are intended to fund early-stage companies and ideas, but applicants have to be savvy enough to already know a lot about their problem and proposed solution. The application for the accelerator requires companies and aspiring entrepreneurs to answer five specific questions based on the same questions SBIR and STTR will ask, including:
• Describe the origins and focus of your project, and how it meets the mandate of supporting research and development (R&D) for unproven, high-impact innovations, in 500 words.
• Give 500 words on the proposed R&D or technical work, including how you will prove the product or service is technically feasible and why it meets the definition of true R&D (rather than being straightforward engineering or incremental product development).
• And 250 words each on the market opportunity and the company/team that will lead the efforts described in the pitch.
“Everything that has to be done for your proposal you are going to do as part of the program,” Dillon said.