What is the Small Business Technology Transfer Program (STTR)?
The Federal STTR program seeks to combine the innovative nature of small business entrepreneurial skills with the unique capabilities of non-profit research and development activities in institutions, such as Louisiana’s colleges and universities, which are better able to handle the risk and expense. These technologies/products are transferred from the laboratory to the marketplace and the small business as well as the institution benefits from the resulting commercialization.
STTR is a highly competitive three-phase program that reserves a specific percentage of Federal research and development funding for awards to small businesses in partnership with nonprofit research institutes to move ideas from the laboratory to the marketplace, to foster high-tech economic development and to address the technological needs of the Federal Government.
Conversely, nonprofit research laboratories are instrumental in developing high-tech innovations. But, frequently, innovation is confined to the theoretical, not the practical.
STTR combines the strengths of both entities by introducing entrepreneurial skills to high-tech research efforts. The technologies and products are transferred from the laboratory to the marketplace. The small business profits from the commercialization, which, in turn, stimulates the U.S. economy.
What Federal Agencies participate in the STTR Program?
There are 5 federal agencies that participate in the STTR program. Those agencies are as follows:
- Department of Defense
- Department of Energy
- Department of Health and Human Services
- National Science Foundations
Who is eligible to participate in the STTR Program?
The business eligibility requirements for the STTR program include the following:
- American Owned (at least 51%) and Independently Operated
- For-profit Entity
- Able to perform two-thirds of the Phase I and one-half of the Phase II work
- An SBA-defined Small Business (less than 500 employees)
The specific definitions regarding principal investigator requirements vary among the agencies, so check to determine the guidelines for the agency you are applying.
The non-profit research institution must be located in the United States and meet one of following three definitions:
- Non-profit College or University
- Domestic Non-profit Research Organization, or
- Federally Funded Research and Development Center (FFRDC).
There is no size limit for the non-profit research institution.
STTR is a three phase program
Phase I: Phase I is the start-up phase. Awards of up to $100,000 fund the exploration of the scientific, technical and commercial feasibility of an idea or technology. Awards are for periods of up to one year.
Phase II: Phase II awards of up to $500,000, for as long as two years, to expand Phase I results. During this period, the work is performed, and the developer begins to consider commercial potential. Only Phase I award winners is considered for Phase II.
Phase III: Phase III is the period which Phase II innovation moves from the laboratory into the marketplace. No STTR funds support this phase. The small business must find funding in the private sector or other non-STTR federal agency funding.
How are future rights to projects developed under the STTR determined?
The small business concern and the research institution must develop a written agreement prior to a Phase I award. This agreement must be submitted to the awarding agency if requested. It should be noted that under the STTR program; the small business concern or the research institution, might subcontract or jointly fund a subcontractor to fulfill the STTR proposal obligation. Furthermore, the small business concern is considered the prime contractor or grantee in an STTR proposal.
The minimum percentage breakout for conducting research in the STTR program is as follows: the small business concern is responsible for at least 40% of the work, and the research institution is responsible for at least 30% of the work.
STTR Proposal Specifics
STTR proposal can not exceed 25 pages and must follow the specific guidelines established by each agency. The following is a general list of proposal elements regardless of agency:
- Cover Sheet
- Abstract or Project Summary
- Description of the Problem or Opportunity
- Background and Technical Approach
- Technical Objectives
- Work Plan
- Related Research
- Commercial Applications
- Key Personnel
Review the specific agency guidelines and format prior to preparing your proposal to insure that you comply with the requirements. If your proposal does not follow the agency’s requirements it will be administratively rejected with out review. Also check on the deadline receipt requirements. Some agencies require delivery and other require a post-mark prior to the deadline for submission.
STTR Proposal Evaluation Process
Each agency uses different review processes. Some agencies use internal reviewers or employees of the agency.
Other agencies use external reviewers such as university faculty members. All agencies use the same general review criteria. The review criteria includes the following:
- Scientific and Technical Merit
- Importance of the Problem
- Scientific or Technical Innovation
- Potential Commercial Application of Innovation
- Investigator and Resource Qualifications
The time required for the review process varies among agencies but generally takes approximately five to six months. Each agency also uses different scoring or ranking systems.