Researchers in northern Colorado and the Boulder Valley often come up with big ideas that they think could make a big difference. But it takes money, patience, and time to get there, and most potential investors have the money but not the patience and time.
The answer often comes in the form of SBIR or STTR grants.
Eleven federal agencies – including the National Center for Atmospheric Research, the National Renewable Energy Laboratory, the National Institutes of Health, the National Science Foundation, the Department of Defense, the National Institute of Standards and Technology, and NASA – offer Small Business Innovation Research (SBIR) grants, and five of them also participate in STTR, the technology transfer program for small businesses.
With these grants, Loveland-based aerospace company Opterus R&D Inc. is developing better designs for retractable ramps and on-board satellite solar panels, Longmont-based LumenAstra Inc. is developing a way to measure a body’s core temperature without use a painful sensor needle. , and Lafayette-based Boulder Nonlinear Systems are perfecting a beam linked to 3D mapping to safely steer autonomous vehicles.
Louisville-based company Solid Power used the boost it received from grant programs not only to refine its solid-state electric vehicle batteries, but also to attract partners Ford Motor Co. and BMW. Group, land a $ 135 million Series B investment round led by Ford, BMW and Volta Energy Technologies to merge with Decarbonization Plus Acquisition Corp. and are preparing to go public on the Nasdaq this fall.
Solid Power, a spin-off from the College of Engineering at the University of Colorado at Boulder, has received more than 10 SBIR and STTR grants totaling over $ 10 million.
CU Boulder recognized the SBIR and STTR grants as such a critical source of funding that they established a Translational Research Center just over a year ago. The center provides university researchers with resources and coaching to help them write and submit competitive SBIR and STTR grant proposals.
The benefits for early-stage development are that grants are non-dilutive and carry little risk.
âNon-dilutiveâ means that the founders of a company do not lose any capital because the funding agency does not take any when their grant is accepted. This differs from private venture capital investment, in which investors take capital in return for helping fund research and development.
Thomas Murphey, who founded Opterus in 2015, said the STTR and SBIR grants his company won allowed him to âput R&D dollars into product development without giving up any stake in the company. It is quite amazing. We were able to get a few of those prices, and we started out in the sense that I’m the sole owner, we have no debt or any other stakeholder. We are developing and marketing three to four product lines, so that’s pretty cool.
In an interview with the Boulder Daily Camera, Brynmor Rees, Assistant Vice Chancellor of the University of Colorado at Boulder for Research and Innovation and Managing Director of Venture Partners at CU Boulder, described the risk mitigation.
âIf a company brings something new, disruptive to the market, usually new technology, the risk is high and requires a lot of research and development to show that it can operate in a relevant environment,â he said. âSubsidies take away the technical risk that is really inherent in bringing disruptive technology to market. “
According to the recent Boulder Innovation Venture 2.0 report, prepared for the Boulder Chamber, innovators in the Metropolitan Statistical Area of ââBoulder attracted $ 256,022,595 in SBIR and STTR grants in fiscal years 2014 to 2018, the latter for which full totals are available. This works out to about $ 796 per person living in Boulder County, a per capita rate significantly higher than in other tech hubs such as Silicon Valley in California; Boston-Cambridge, Massachusetts; Ann Arbor, Michigan; or Bryan-College, Texas station. For the city of Boulder alone, which attracted $ 175,404,660 in grants for the period, the per capita rate was even higher, $ 1,634 per person.
The highly competitive grant programs encourage research by small US companies with the goal of bringing innovative and profitable products to market. The STTR program also requires small businesses to collaborate with nonprofit research institutions such as CU Boulder, Colorado State University, and Colorado School of Mines.
Both awards go directly to a company, but under STTR, a company must outsource to a research university. Under SBIR, the principal investigator must be at least 51% employed in the company.
The grants are divided into three “phases”. Phase 1 aims to establish the technical merit, feasibility and commercial potential of the proposed R&D efforts and to determine the quality of performance of the small business receiving the grant. Phase II pays to continue the research started in Phase 1, and Phase III helps winners continue to commercialize.
At Opterus, said Murphey, âWe have just been informed of a Phase II grant with the Air Force for a small satellite solar panel that we are working on. We just completed Phase II with NASA for a much larger solar panel that we developed with SBIR dollars. “
Opterus has received two STTR grants and nearly a dozen SBIR grants, Murphey said. âIt sounds like a lot,â he added, âbut when you talk about developing a new boom or a new solar panel, to really achieve them, it takes $ 5-10 million of effort. So those efforts SBIR shakes it up, but you also need to get other funding because the development of spacecraft components is very expensive. â
Several CU Boulder spinoffs have taken advantage of the grants. For example, Aspero Medical is commercializing new endoscope technology that prevents slippage and can reduce endoscopy failures. Artimus Robotics has developed a soft and flexible robotic actuator, moving from a robot made of hard metal or plastic components to one that moves more like an octopus. And LumenAstra has five student researchers working on its project in a UC lab.
Once the grant is received, a verification process ensures that recipients use the funds for the funded project.
Murphey gives a lot of credit to the Opterus Growth Grants. âWe have 15 employees,â he said, âand we are looking for a chief engineer and a senior engineer. “
Manufacturing of Opterus takes place over 9,000 square feet in a former Hewlett-Packard factory in Loveland that has become the Rocky Mountain Center for Innovation and Technology and is now the Forge Campus.
âWe incorporated in New York as part of an accelerator there, but they weren’t too transformative for us,â said Murphey, âso the one that’s been a lot more helpful is The Warehouse in Loveland , which is also on the Forge campus. Loveland is a good place in northern Colorado because we have access to Boulder County stuff as well as Larimer County stuff. We have a good relationship with CU and CSU.
What advice would Murphey give to anyone applying for an SBIR or STTR grant? The hardest part is monitoring grants offered by federal agencies.
âYou have to really try to find the client who has the solicitation process there, and really understand what they want,â he said. âUsually in the solicitation it’s not clear. You read it and it’s a page and you’re like, “I don’t understand. What are you really asking? So you need to be able to contact the government groups that are trying to develop these technologies.
âIt’s all about ‘tech pushes’ – tech developers trying to push their technologies into commercial systems,â he said. âSo you have to understand what these groups are trying to do. Reaching out to them and talking to them is the hardest thing to do. If you can figure this out, now you have a basis for doing something they really want.