SBIR at the National Science Foundation (2015) / Chapter Skim
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Appendix E: Case Studies
Appendix E: Case Studies
Pages 252-336
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From page 252... ...
They operated in a wide range of technical disciplines and industrial sectors. Overall, this portfolio sought to capture many of the types of companies that participate in the SBIR program.
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From page 253... ...
; these data are drawn from NSF awards data, and reflect company self-certification.
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From page 254... ...
. According to ALD NanoSolutions, the company is the first to carry out atomic layer deposition on particle surfaces and on polymer surfaces (also includes non-particle surfaces)
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From page 255... ...
For aluminum oxide, ALD NanoSolutions' most popular and versatile chemistry, one layer is composed of molecules containing aluminum, the second layer is oxygen- containing molecules: water molecules. The aluminum molecules react with the surface to be coated, depositing one layer of aluminum atoms on the surface (since aluminum molecules do not react with other aluminum molecules)
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From page 256... ...
FUNDING AND COMMERCIALIZATION ALD NanoSolutions has utilized a range of commercialization strategies and approaches, aside from SBIR funding. These include the following:
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From page 257... ...
Consequently, the contract R&D side of the business has grown rapidly, and now accounts for more than 80 percent of annual revenues. ALD NanoSolutions continues to receive other funding as well, including more than $7 million in Phase I and Phase II SBIR awards from National Science Foundation (NSF)
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From page 258... ...
She believes that most of the company's early work will in the end find its way into a commercial product in some way. And she also added that ALD NanoSolutions' most promising commercial partnerships -- for example with Tyco -- have been based on data from NSF SBIR awards.
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From page 259... ...
At ALD NanoSolutions, some projects would have required $80-100k in external testing -- so they could not be funded through SBIR Phase I and were dropped. • Timelines.
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From page 260... ...
Louis County. Divergence also leases greenhouse facilities and uses core labs in advanced proteomics/mass spec and microscopy at the Donald Danforth Plant Science Center.
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From page 261... ...
, and transgenic plants (STEM™) ; • emonstrated the efficacy of its novel nematicidal chemistry against plant d parasites in multiple field trials; • alidated approaches to plants with built-in nematode resistance which are v being developed for soybeans and other crops; • aised more than $20 million from investors and received more than $10 million r in grant funding for research and development; • reated a significant intellectual property portfolio, including multiple pending c and 35 issued patents as well as trade-secrets, around our discovery platform, molecular targets, chemistries, and transgenic methods for parasite control; • stablished multiple important research and commercial relationships, includ e ing a collaboration with Monsanto Company to develop nematode-resistant soybeans and a relationship with a leader in animal health.
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From page 262... ...
, about 25 percent came from grants (including SBIR awards) , and about 25 percent came from corporate relationships.
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From page 263... ...
Other High-Potential Markets Divergence has identified several other markets where its core technologies could be applied commercially. Veterinary Medicine: Animal Parasites Livestock and companion animal parasites include internal worms such as nematodes (endoparasites)
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DIVERGENCE TECHNOLOGY Divergence utilizes its expertise in the application of comparative and functional genomics to the control of parasitic nematodes. The last decade has seen revolutionary progress in both the generation of sequence information and methods for rapid gene knock-down.
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From page 265... ...
Divergence is a very strong supporter; without SBIR funding he did not know where the company would be: it might not exist, and it certainly would not be the company that it is. In addition, these awards provided a significant influx of non-dilutive funds, which added to the company's attractiveness to professional investors.
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From page 266... ...
Divergence sees the NSF SBIR program as somewhat different from those at other agencies. • Submission requires use of FastLane, which is completely different than other application processes, and requires that the company provide more detail.
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From page 267... ...
USDA is reportedly now splitting commercial and scientific review. • Commercialization support programs.
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From page 268... ...
Three products from the company are being commercialized. The Divergence nematicide tioxazafen is now in phase III in Monsanto's technology pipeline as a seed treatment for corn, soy, cotton and eventually other crops with an anticipated 2017 launch.
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From page 269... ...
IST management has been working on flexible plasma displays since the late 1990s. The company's strategy was based on pairing high tech glass display capabilities, which were located in the Toledo region, with low tech "bubbles" to create large, flexible displays at various sizes without the need to invest in a multi-billion dollar manufacturing plant.
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From page 270... ...
Plasma-spheres are also produced much more rapidly, as the 12-16 hour gas-processing step is bypassed. According to IST, plasma spheres have substantial advantages over standard plasma displays.
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From page 271... ...
Ms. Wedding noted that its flexible displays have substantial advantages in terms of shipping.
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From page 272... ...
Wedding notes, "IST could not do the necessary research to develop its innovative products." IST has positive views on the NSF SBIR program in particular, which IST believes does a particularly good job of selecting high quality projects for funding. According to Ms.
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From page 273... ...
Larger awards would lead to too great a focus on hot topics, and potentially good projects would be ignored. More Flexibility on Matching Funds for Phase IIB In particular, IST saw the need for more flexibility on the timeframe for acquiring matching funds.
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From page 274... ...
Since 2010, the company believes that the NSF SBIR program has evolved from providing assistance in commercialization (via DawnBreaker) to demanding commercialization within a time frame of about two years.
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From page 275... ...
. 6 Note that Immersion Corporation was also included in a series of NSF case studies in an earlier study of NSF SBIR grant companies, published in 2008.
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From page 276... ...
However, the need for these patents is clear in the context of the license-based business strategy for non-medical devices, and the Sony patent infringement settlement shows that this approach has in some ways already been successful. HAPTICS TECHNOLOGY Immersion haptics systems typically include five kinds of elements: • One or more sensors • Actuator (motor)
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From page 277... ...
The medical devices business in contrast uses haptics technology to provide competitive advantage in the market for simulated surgical training. The Licensing Business Key components of the licensing business include the following: Gaming Devices Immersion began to license products in 1996, starting with the gaming d evices sector.
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From page 278... ...
Simulators allow these professionals to practice in a risk-free environment where mistakes have no dire consequences and animal or cadaver use is unnecessary. Specifically, Immersion has developed four lines of medical simulation products covering a.
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From page 279... ...
The NSF Phase II and Phase IIB awards were, according to Dr. Ullrich, instrumental in funding this important development.
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From page 280... ...
As with other NSF Phase IIB awards, this suggests that in some ways the Phase IIB program may simply reward existing relationships.
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From page 281... ...
Dr. Ullrich commented that although they provided useful networking opportunities and helped to build valuable connections between companies and NSF program managers, commercial training was not especially important to a publicly traded firm like Immersion.
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From page 282... ...
SBIR funding was key to equipping the facility and hiring a dedicated founding staff. This development coincided with the final stages of the telecom boom.
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From page 283... ...
Initially, the company worked with practitioners and surgeons at Stanford University Medical School, in cardiology, radiology, and oncology. Through its Stanford connections, the company then moved on to partner with several local medical devices companies who will manage FDA market testing and industry-specific marketing.
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From page 284... ...
Moslehi observed that photonics face the classic difficulties encountered by many highly innovative technologies in that they face underdeveloped markets if they are early to the game: while customers may want a new product, he notes that they may not feel they need it immediately. This sometimes causes substantial problems for innovative companies working in emerging markets.
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From page 285... ...
The I* Sense® family of commercial products includes several core elements: Sensors Optical sensors are the nerve endings of any monitored system and IFOS provides many different types of sensors as described below: • Off-the-shelf sensors packaged for industrial usage • Bare fiber Bragg gratings (FBG)
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From page 286... ...
IFOS is presently negotiating a licensing agreement with a well-established company. APPLICATIONS AND MARKETS Traditional electronic sensors can meet many current marketplace needs but often fail to operate in harsh and demanding environments, have insufficient
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From page 287... ...
Fiber optic sensors are used because they are small, highly sensitive, immune to electro magnetic interference, and reduce the risk of explosion. To take one example, optical sensors can be used in sub-sea environments to monitor dynamic pipeline strain levels, provide real-time detection of impacts by hydrate movements, and to monitor pressure, temperature and strain in deepwater pipelines at water depths greater than 2,000 feet and at temperatures around 400 degrees F
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From page 288... ...
IFOS supports the Phase IIB program, in which it has participated in the past. Matching funds have been primarily generated through purchase orders from customers as part of IFOS efforts to garner interest in its products and partner
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From page 289... ...
Overall Dr. Moslehi is concerned that agency SBIR programs do not distinguish clearly enough between emerging and non-emerging technologies or between areas where incremental improvements can be marketed and others that are potentially transformative but markets are limited in the short term.
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From page 290... ...
is a privately held company located in Santa Cruz, California. LIM now focuses mainly on providing consulting services to the education publishing industry, covering both software and print materials.
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THE INTERNET REVOLUTION OF THE LATE 1990s Reaching the market is insufficient for commercial success. The widespread advent of the Internet in the late 1990s changed educational software dramatically; the provision of online tools and web-based environments generally meant that publishers had to be prepared to offer larger system able to handle much larger numbers of simultaneous users.
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From page 292... ...
Over time, LIM stopped applying for NSF SBIR awards, for two primary reasons. First, the company shifted toward consulting and away from self- enerated g stand-alone projects.
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From page 293... ...
Given the speed with which market conditions change, a single annual deadline seems unnecessarily inflexible.
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Hans Wijmans, Director of Research19 August 19, 2009 BACKGROUND MTR is a privately held company headquartered in Menlo Park California. The company has sales offices in Houston and Brussels.
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From page 295... ...
The field test validated the potential for MTR's membrane process to efficiently capture up a substantial portion of the CO2 from coal-fired power plant flue gas.20 SBIR AWARDS Clearly, SBIR played a critical and ongoing role in funding the development of MTR's core membrane technology, while providing the equivalent of stable contract funding to underwrite a portion of MTR's overall budget during the 15 years before commercial products finally began to dominate. 20 Tim Merkel, Xiaotong Wei, Jenny He, Bilgen Firat, Karl Amo, Saurabh Pande, Steve White, and Richard Baker, "Membranes for Power Plant CO Capture: Slipstream Test Results and Future Plans.,
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From page 296... ...
Wijmans, SBIR was an integral part in the evolution of the company, and supported the development of most of the company's early core technologies: • early DoE awards supported development of the CFC technology • EPA SBIR awards addressed PVC manufacturing • DoE SBIR awards funded work on polyolefin applications and demonstra tions of the application of existing technologies to wider applications Most awards supported the work well beyond simple feasibility studies. NSF awards came later, and supported work on hydrogen (for green energy)
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From page 297... ...
• Recovery of ethanol from fermentation and food industry process streams. • Removal of organic contaminants from wastewater streams.
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From page 298... ...
IMPROVING SBIR Dr. Wijmans believes the NSF SBIR program is too focused on the VC funding model.
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From page 299... ...
MTR's participation in the SBIR program is significantly reduced compared to 5 years ago, particularly in the NSF program. MTR's impression is that the company is "too big" for the SBIR program, even though it employs fewer than the 500 employee limit used to define a small business.
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From page 300... ...
In line with this, the company developed a number of partnerships focused on different applications of its core technology. Since 2005, the company has increasingly focused on a new set of markets and a new business model.
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From page 301... ...
That led to a collaboration with Bayer CropScience to identify commercially valuable chemistries that enhance stress tolerance. BOX E-4 Example of genetic modification: Enhancement of Photosynthetic Output Mendel has discovered novel gene networks and multiple transcriptional regu lators of those networks that control core photosynthetic output in a number of different ways.
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From page 302... ...
This close relationship made it relatively simple for Mendel to meet the requirements for NASF SBIR Phase IIB without any change to its standard business operations (see SBIR below)
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From page 303... ...
SBIR also helped Mendel return to genetic approaches to disease resistance, for example addressing the rapidly growing threat of Asian rust in soybeans. SBIR funding and the award itself helped Mendel attract Monsanto's attention to a possible solution to this problem.22 This reflects Gutterson's view that "SBIR is all about leveraging to build off the core Mendel platform into new areas." Mendel also received some Phase IIB funding from NSF.
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From page 304... ...
The submission of a regulatory dossier represents a major step toward final commercialization.26 Bayer CropScience In early 2008, Mendel announced a new research partnership with Bayer CropScience, which continues previous joint activities focused on stress responses generated by Bayer agrochemicals like Imidacloprid and Trifloxystrobin. The program aims to discover and develop further chemical products that regulate plant stress tolerance, leveraging Mendel's knowledge of plant transcription factor pathways with the expertise of Bayer CropScience as a leader in agricultural 24 See Mendel Biotechnology Press Release, "Mendel Biotechnology Yield Trait Reaches Phase III for Monsanto Soybean Products," January 9, 2009.
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From page 305... ...
BP In May 2007, Mendel and BP entered into a strategic long-term collaboration for the development of a BioEnergy Seeds and Feedstock business. This reflects Mendel's new focus on biofuels as a pillar of the company's future.
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From page 306... ...
Application Deadlines Gutterson strongly endorsed the need for multiple deadlines; a single annual deadline is no longer sufficient given the rapidly accelerating speed of technical change. Topics Mendel would like to see more broad topics, where firms can decide which technologies fit the agency's requirements.
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From page 307... ...
Since then, TSi changed to a company with a global market, selling ground stations and mission control centers in more than twenty countries, most of which have retained TSi for ongoing management and maintenance, often for decades. In the early 2000s TSi rolled out a second major product line, the Trident I ntegrated Maritime Surveillance System (IMSS)
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From page 308... ...
The Division has worked in software, sensors, control systems, and active materials, including m agneto-rheological fluids for semi-active dampers. Supported in large part by the SBIR program, the Division has investigated a wide range of areas, some leading to new products for TSi (elements of the coastal stations)
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From page 309... ...
As a small business, Innovital has made use of the SBIR program to fund its basic research. TSi Products and Markets Satellite-based Search and Rescue (SARSAT)
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From page 310... ...
The TSI MCC is a command and communications system based on a client server structure, which gathers data from satellite ground stations (Local User Terminals) , aggregates and manages the data through its server and proprietary software, and delivers the data for display and analysis in a graphical interface and 3D GIS.
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From page 311... ...
In parallel, TSi used SBIR funding to develop solutions using flexible hoses and air to provide air driven mechanical operation of flaps on aircraft wings. The air driven hoses ("pneumatic muscles")
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From page 312... ...
Initially, SBIR awards had provided funding for investigator-initiated research and an important funding stream that allowed for the growth of the company and its personnel during its early years. As the Company transitioned toward a product-driven model, SBIR funded the research that led to both of the Company's core product lines -- SARSAT search and rescue, and Trident ship based monitoring.
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From page 313... ...
Similarly, TSI now builds high performance cameras, which are also sold as part of its integrated systems, and grid free power systems for installations in remote areas lacking in reliable power. Phase IIB TSI's spinoff company TRX Systems won one of the first Phase IIB awards from NSF.
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From page 314... ...
He has since started two new companies, one working in sleep health, and the other in medical devices. Both have received SBIR funding.
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From page 315... ...
It focuses on providing tools for building tactile images so that educational materials can be used by visually impaired students. TG is a world leader in this field, with commissions from a wide range of educational and government organizations.
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From page 316... ...
31 The TTT is currently in wide use around the world, and TG now provides additional capabilities related to the TTT, such as the TTT Authoring Tool, which allows teachers and other users to develop their own talking tactile materials, and are now also being used to publish illustrated digital talking books. In addition, the TTT has been used to deploy standardized tests to visually impaired students, for example the MCAS 8th grade math assessment.
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From page 317... ...
The Braille courseware project and others reflect the company's view that it would be unwise to place too large a bet on any single product or product line, and also that with the accelerating pace of technological change, it is not feasible to bank on any single product indefinitely. The Talking Tactile Pen (TTP)
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From page 318... ...
in California was in fact engineered by the NSF program director, Ms. Sara Nerlove, whose hands-on approach generated some additional work, but also led her to make a connection that neither company was initially very interested in making.
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From page 319... ...
Landau, SBIR was very important for TG: The company would never have developed any commercial products without the SBIR funding. There is no money in the assistive technologies field for new technologies.
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From page 320... ...
Increased flexibility in these areas would permit TG to return to NSF for further SBIR funding.
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From page 321... ...
BUSINESS MODEL TRX is the developer of NEON®, an indoor location system that delivers precise, infrastructure-free tracking of personnel inside buildings where GPS is not available and in outdoor urban centers where GPS is unreliable. NEON greatly improves situational awareness and command effectiveness through the use of advanced sensor fusion, time of flight ranging, and mapping algorithms that deliver precise, real-time location of personnel in GPS-denied locations.
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From page 322... ...
The NEON Engine software includes application programming interfaces APIs for integrating input or constraints from partner systems and for providing indoor location data to third-party applications. System Components In addition to delivering location information in an API, TRX delivers an application into the public safety market (called NEON Tracker Command Software)
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From page 323... ...
This differentiates NEON sharply from many competing p approaches, which rely in part on existing building maps and often require installation of beacons to deliver location indoors. Defense Dismounted war fighters increasingly rely on location for navigation and to deliver the situational awareness required for optimal command effectiveness.
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From page 324... ...
Partners and Business Model TRX has focused primarily on infrastructure-free applications for which it has a substantial competitive advantage and on government applications in particular. It is now expanding to include mobile applications.
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From page 325... ...
Federal Highway Administration: Navigation Aid for the Blind and Visually Impaired TRX is developing a navigation aid for the blind and visually impaired, to track the location of a blind person anywhere, including areas where GPS is not available or reliable (for example, indoors or in urban areas with tall buildings)
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From page 326... ...
"The TRX NEON Indoor Location System clearly complements Motorola Solutions' capabilities to improve safety for mission-critical users." 40 TRX AND SBIR TRX can already be viewed as an SBIR success story. Only 5 years after its founding, it received a Tibbetts award in 2012.
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From page 327... ...
Important early support was also provided by a TEDCO grant from the state of Maryland, which together with the SBIR program provided critical early funding to deliver proof of concept. Carol Politi notes that this early support was very important to the company's success and allowed it to file its first patents in 2007 and 2008.
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From page 328... ...
TRX frequently rejects opportunities to pursue SBIR funding in order to stay focused on its core business of location and mapping. SBIR Matching Funds and Enhancements TRX has found enhancement programs within SBIR to be of considerable value and would recommend expanding them, particularly at DoD where they can be used to help fund company efforts to traverse the difficult and demanding DoD validation process.
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From page 329... ...
Ms. Politi observed that through NSF, TRX had received commercialization support from LARTA, whose process was especially helpful in relation to a new collaborative mapping initiative.
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From page 330... ...
DiBello, this dual focus draws criticism from some parts of the academic community; however, other senior academics have been strong supporters of WTRI's work. WTRI's business to date can perhaps best be understood as providing sophisticated and highly customized war gaming capacity to business organizations, focused on improving the efficiency of their internal processes within the business environment that they face.
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From page 331... ...
Dr. DiBello observes that by breaking business processes into discrete elements, a substantial amount of the simulation design and build process -- perhaps 90 percent -- can be automated and scaled.
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From page 332... ...
This rapid feedback is valuable, as it permits companies to see whether their executives can handle change at the pace and depth required. For example, a chemical company planned to introduce radical change into their business model, and wanted to determine whether C level managers can could work with the new strategy.
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From page 333... ...
WTRI has also developed versions of OpSim using virtual world operational simulation, using environments such as Second Life.43 The virtual world OpSim provides more flexibility in design, and is used by WTRI in particular for rehearsal of business strategies that are heavily technology supported, such as logistics distribution or network management. In 2008, WTRI collaborated with IBM to developed 3-D environments for training IBM employees in the managing enterprise IT engagements.44 WTRI is now heavily involved in using OpSim to work with leaders of the project management and mining industries, and will likely sell its lower end c apabilities in this area to a buyer in the project management sector.
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From page 334... ...
DiBello remains overall a strong supporter of the SBIR program in general, and the program at NSF in particular. SBIR has been central to the development of WTRI technology -- and has been used to fund development of 45 WTRI |
From page 335... ...
DiBello has a positive view of the NSF SBIR program, and of the division with which WTRI has been working. WTRI's strong commercialization track record and effective use of SBIR funds in the past has, she believed, helped to support successful application record.
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From page 336... ...
RECOMMENDATIONS Dr. DiBello was primarily concerned with what she saw as two core issues for the NSF SBIR program: 1.
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