St. Anthony: Navy veteran Pat Dillon brings home federal bacon for emerging tech companies

Minnesota has gotten a pretty good return from Pat Dillon over the last decade.

Dillon is the unheralded founder of MNSBIR Inc., which recently became a stand-alone nonprofit enterprise. Working with several contractors and her budget of $265,000, she has managed to bring $63 million in federal funds for 93 promising Minnesota tech-oriented companies since 2014.

"There's a lot of companies I've worked with that made it to the winner's circle," Dillon said. "There also have been some that didn't work out. Our goal is to help small businesses improve their technology and become larger businesses."

Dillon's outfit helps small technology-driven businesses recruit nondilutive seed capital from more than a dozen federal agencies, including the Department of Defense and the National Institutes of Health.

Dillon, a youthful 65, is a retired naval intelligence officer who was activated for a 2011-12 tour in Afghanistan amid a 40-year active-duty and reserve career that started after graduating high school in rural Wisconsin. She got into the federal grant business on a part-time basis while in college at Winona State University in the 1980s.

Over the last decade, Dillon has increased Minnesota's modest share of federal funding.

Dillon works through the SBA's Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, dubbed America's Seed Fund.

The investment from these programs have resulted in a benefit to the Minnesota economy of more than $2 billion through "thousands of high-paying jobs," Dillon estimates.

Some of the better-known state companies include: now-booming Cirrus Aircraft in Duluth; Sage Electrochromic, a high-tech glass manufacturer in Faribault; and med-tech firms Surmodics, NVE Corp. and Miromatrix in the Twin Cities.

Two decades ago, Dillon helped family-founded Minnesota Wire of St. Paul secure the research and development grants that enabled it to broaden and accelerate its product portfolio of custom-designed wire, cable and interconnect assemblies for military, commercial and space industries.

More recently, Dillon helped Chromatic 3D Materials of Golden Valley — which uses 3-D printing to produce specialized molds for med-tech and other manufacturers — raise $1.4 million that got its products out of the laboratory. The company subsequently raised $10 million in private capital that has fueled its commercial growth.

The small firms she assists with federal funding include several that license technology developed by the University of Minnesota, Mayo Clinic and other research hubs.

The federal investment often spurs significant private investment.

Nationally, huge Qualcomm, Symantec and iRobot have benefited from SBIR investments in their salad days. At least two Minnesota firms that received SBIR grants eventually grew to be publicly owned companies: NVE Corp. and Surmodics. Some grow privately.

Late last year, Minnesota Small Business Innovation Research left Minnesota Technology Association, or MnTech, to become an independent nonprofit business.

The move has been in the works for a couple of years, said Jeff Tollefson, a former venture capitalist who is CEO of MnTech.

"Pat decided that starting her own nonprofit was what she wished to do and we fully supported her in this transition," he said.

"We will be more effective as a stand-alone organization because we now have a dedicated board of directors who are committed to the vision and mission of MNSBIR," Dillon said. "Startups and small businesses require a knowledgeable, experienced and dedicated resource to help them navigate the complicated and competitive federal research and development environment leading to commercialization of their technology."

Dillon is on the hunt this winter for $5 million in support from the Minnesota Legislature. The money is intended to expand MNSBIR's capacity and ability to expand small-business support and increase federal funding.