Washington, D.C.— Today, House Small Business Committee Chairwoman Nydia M. Velázquez (D-NY) hosted a hearing focused on improving federal Research and Development (R&D) programs supporting small business innovation. The hearing covered the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, which help entrepreneurs commercialize federal R&D innovations.
“Today, our country is at a crossroads when it comes to our innovative capacity, just as we were when Congress created SBIR/STTR,” said Chairwoman Velázquez. “In the latest Bloomberg Innovation Index, the United States dropped out of the top ten entirely. Regaining our footing as one of the world’s most innovative nations should be a bipartisan goal. If we are to accomplish it, it’s vital that we utilize the power of small businesses.”
Since the 1980s, the Small Business Administration (SBA) has operated SBIR and STTR to reduce investment risks in small businesses and encourage entrepreneurs to commercialize federal R&D innovations. Congress funds these programs through federal set-asides of government agencies’ extramural research and development funds. SBIR and STTR have an impact on small businesses across a variety of different sectors every year. In FY 2020, agencies contributed $454 million for 1,030 awards to 744 small businesses. Small businesses that received early funding from SBIR and STTR have grown into successful corporations like 23andMe, Qualcomm, Symantec, and Da Vinci Surgical Systems.
With Congress preparing to reauthorize the program before September 30, 2022, the hearing gave members the chance to look at ways to improve the program to reach a maximum number of small businesses.
The hearing also examined how these programs can be utilized to address inequities in STEM fields. SBIR and STTR have the potential to assist minorities that often have a harder time accessing seed capital to pursue the creation of new technologies. During the hearing, members discussed ways that the two programs can reduce obstacles that underserved groups face in the small business innovation sector.
“This additional source of funding helped us bridge to a stage in which we were able to demonstrate our capabilities and potential, and thus acquire paid research partnerships, develop a therapeutics business, support the broader scientific community through published research, and even contribute a small part to closing the diversity gap in genetics research,” said Dr. Joyce Tung, Vice President of Research at 23andMe, Inc. “We believe supporting research in industry, particularly in small startups, will play an increasingly important role in innovation and that the SBIR program can play a critical role in nurturing that innovation.”
“Until we reach that critical revenue milestone where we can fully self-fund, we are grateful for the financial assistance of the SBIR/STTR programs,” said Pat Keady, Founder, CEO, and President at Aerosol Devices Inc. in Fort Collins, CO. “As a primary employer, our goal is to offer an increasing number of good-paying jobs and sell quality products to customers around the world. We aim to provide an exceptional return on the tax-payer investment. The SBIR/STTR grants have been a lifeline for our small early-stage company.”
“Without FAST funding, ASBTDC would not be able to offer these highly regarded services and innovative Arkansas companies would be lacking the established support services needed to succeed in the highly competitive SBIR/STTR program,” said Rebecca Todd, Innovation Consultant at Arkansas Small Business and Technology Development Center. “SBIR/STTR funding is critical to advancing research and commercialization of small firms that will lead to needed solutions and support higher wage jobs.”