1. National Science Foundation Industrial Innovation Funding F. C. Thomas Allnutt Division of Industrial Partnerships & Innovation Division of Industrial Partnerships & Innovation Vermont June 2008 - overview

2. The NSF Mission  To promote the progress of science and engineering  To advance the national health, prosperity, and welfare  To secure the national defense

3. NSF is… National Science Board Director IG Office Staff Offices Directorate for Engineering Directorate for Geosciences Directorate for Computer and Information Science and Engineering Directorate for Mathematical and Physical Sciences Directorate for Social, Behavioral, and Economic Sciences Office of Polar Programs Integrative Activities (MRI, STC) Directorate for Education and Human Resources Directorate for Biological Sciences Industrial Innovation and Partnerships (IIP)

4. Division of Industrial Innovation and Partnerships (IIP)  Link basic research to the marketplace  Cross-cutting programs – SBIR – STTR – I/UCRC (Industry University Cooperative Research Centers) – PFI (Partnerships for Innovation)

5. SBIR & STTR Programs  2.5% of NSF budget SBIR  0.3 % of NSF budget STTR  Goal is to move science from the bench to the marketplace

6. Bridging the “Valley of Death” Research and Education -Univ. -R&D Labs Prototypes Small Business Tech Development Business Development Seed Funding Business Startups; Expansions NSF SBIR

7.  DODDefense  HHSHealth  NASASpace  DOEEnergy  NSF~$110 Million  DHSHomeland Security  USDAAgriculture  DOCCommerce  EPAEnvironment  DOTTransportation  DoEDEducation Participating Agencies TOTAL ~ $2.3B Est. FY 2008

8. NSF SBIR/STTR Innovation Model PHASE III Product Development to CommercialMarket PHASE I FeasibilityResearch $100k/6 mos Taxes Federal Investment PHASE II ResearchtowardsPrototype $500k/24 mos MATCH MAKER Phase IIB Third-Party Investment + 1:2 NSF Matching Private Sector or Non-SBIRInvestment Unique to NSF Phase I B Third-Party Investment + 1:2 NSF Matching

9.  NSF is not the Final Customer  NSF is not buying a product, process, software, or intellectual property commercialize  NSF wants to see the grantee successfully commercialize the innovation  Company needs investment dollars beyond NSF SBIR/STTR Doing Business with NSF

10. SBIR/STTR Reviews  Technical Review – Technical Merit – Broader Impact  Commercial Review – Team – Market Opportunity – Technology, IP, and Competition – Financial Plan

11. Remember the Supplements! Remember the Supplements! http://www.nsf.gov/eng/sbir/phase_iib.jsp http://www.nsf.gov/eng/iip/sbir/supplemental_requests.jsp http://www.nsf.gov/eng/sbir/phase_iib.jsp  IB – Gap Funding – Max $50K (1:2) match for third party funds  IIA – Minority Partnership – Max $150K partnership with a CREST institute to delve deeper into the technology 30:70 (grantee : institute)  IIB – Third-Party Leverage – Max $500K (1:2) match for third party funds  IICC – Leverage of Community College – Max $40K partnership with a MSCC institute to delve deeper into the technology 25:75 (grantee : institute)  REU/RET – Increased Human Capital

12. IIB Supplement  Supplemental Research to Phase II  Bridge the gap between Phase II and Phase III  Third-Party match required  Third-Party can be Private, State, or Federal

13. NSF/SBIR Phase IIB Success 200420052006 Outside Investment$10.6 M$43.5 M$57.8 M NSF Leverging Funding$5.3 M$14.1 M$18.4 M # of Companies224449 Companies with >$1M Investment 42329 % (>1M / Total)16%52%59%

14. Takeaway  Many SBIR/STTR programs out there!  At NSF ~$110M/year granted primarily for seed- stage development in… – Software & Systems (SS) – Biotechnology & Chemical Technologies (BC) – Electronics (EL)  Program to mitigate technical risk and bridge the “Valley of Death”  Investment in Country’s Innovation Capacity

15. Useful Links: www.sbir.gov (SBIR Resource/gov run) www.sbir.gov (SBIR Resource/gov run)www.sbir.gov www.zyn.com/sbir/ (SBIR Gateway) www.zyn.com/sbir/ (SBIR Gateway)www.zyn.com/sbir/ www.nsf.gov/eng/iip/sbir/ (NSF SBIR homepage) www.nsf.gov/eng/iip/sbir/ (NSF SBIR homepage)www.nsf.gov/eng/iip/sbir/ Contact info: Tom Allnutt email: tallnutt@nsf.gov tallnutt@nsf.gov phone: 703-292-5332 Questions??

16. IB Supplement  Bridge gap between Phase I & Phase II  Foster partnerships with investors and attract third party funding  Maximum award $50,000 based on a third party investment of $100,000

17. IIA Supplement - Minority Partnership  Consistent with the SBIR Legislation – encourage minority participation  Opportunity to further enhance the science and engineering research underlying the SBIR technology  Phase IIA is a supplement to an active Phase II grant

18. Phase IIA Minority Partnership (continued)  Requires a Phase II grantee to partner with a CREST/RISE grantee: http://www.nsf.gov/pubs/2005/nsf05/nsf0520. pdf  Budget not to exceed $150, 000 – SBIR portion <30% – CREST/RISE portion >70%

19. Phase IIB Review  Reviewed in-house  Submission must be within original 24 month award period  Reviewed by at least two NSF Program Officers  Two Criteria  Award recommendations within 90 days from the two closing dates of September 1, 2006 and March 1, 2007  Minimum $100,000 total Third-Party investment (s)

20. Phase IIB Information  NSF will match 50% of the funds received  Overall total (Phase II & Phase IIB) cannot exceed $1,000,000  Payment schedule (50% with the supplemental award, 50% with the submission and approval of 6 month interim report)  Extends Phase II grant by one (or two) year (s)

21. IIB Third-Party Funds Can Come From...  Another company  Venture capital firm  Individual “angel” investor  State Government  Local Government  Non-SBIR Federal Government  Any combination of the above

22. MatchMaker Phase III Goal - Link Early Stage Investors and Strategic Corporate Partners with Qualified Phase II Grantees

23. MatchMaker “Value-Added”  NSF Program Officers have done “due diligence” on companies  Because of NSF Program selectivity Corporate Partners will receive targeted matches  Through MatchMaker Corporate Partners will be locked into Future opportunities

24. MatchMaker – Grantee Criteria  Definitive plan to protect intellectual property  Consent to NSF SBIR to provide reference for company  Phase II proposal ended 5 years ago or less  Good standing within the SBIR program

25.  Mailbox (SBIRmatch@nsf.gov) was created to allow potential investors and PI’s to register  Program Manager matches their PI’s with potential investors and makes the introduction  MatchMaker Coordinator manages the mailbox and maintains the database MatchMaker Connection