Gail & Jim Greenwood, Greenwood Consulting Group, Inc.

Copyright © 2004 by Greenwood Consulting Group, Inc.

You probably know already that the main purpose of a Phase 1 SBIR or STTR project is to prove the feasibility of your innovation in meeting a need, solving a problem, or exploiting an opportunity. But there is actually a second purpose to the Phase I project. It is hinted at by several agencies, including EPA and NSF, when they make statements like "Phase I should show the ability of the proposer to conduct R&D." So what exactly does that mean? Glad you asked.

If you are a newcomer to SBIR/STTR (or at least new to the particular agency to which you sent the Phase I proposal), they probably don’t know you from Adam (or Eve). Phase I, then, is an investment of $100k for the agency to "get to know you" and to judge whether you are someone who can be trusted to do good things with a subsequent $750k Phase II project.

Given that you are trying to establish your credibility in Phase I as someone in which the agency should invest in Phase II, what should you do? Here are some suggestions:

Finish the Phase I project. Seems simple enough, but we’ve seen Phase II proposals that basically say "we didn’t finish what we said we’d do in Phase I." What do you think that does for your credibility? It says you are a quitter—you don’t finish what you start if you get tired, distracted, or run out of money despite signing a grant or contract in which you said you would do the work. This includes filing final administrative reports, invention disclosures, and the like.

Finish Phase I on time. If you had to ask for a no cost extension to complete the Phase I project, have a good explanation. Having higher priorities, taking an extended vacation, or mismanaging the project are not going to give your Phase II reviewer a comfort level.

Use the team you proposed. Did you propose to have your hot shot PI do 100% of the Phase I work, but then had her only do 5% and had a junior staffer do the rest? Did you tout your relationship with Harvard Medical School in the Phase I proposal but actually use Harvey’s Junior College instead? Once again, you are sending the message that you cannot be trusted to do what you say you will do. Of course, there’s also the question of whether you have also violated your contract or grant terms…

Summarize your good work. Every agency, as part of your Phase II proposal, wants you to write a summary of your Phase I project. This is a great chance to describe your careful and professional approach, your thorough analysis, and your reasoned conclusions—and in doing so show the agency that you know how to do high quality research. By the way, this is a great place to include some photos of your team doing some of the Phase I work, especially if your folks look professional (clean white lab coats, not Hooters t-shirts and greasy jeans) and they are in a good environment (modern equipment on a real lab bench, not duct-taped washing machine parts on a shipping crate).

Don’t be a stealth Phase I recipient. In his presentations, Joe Henebury (who runs DOT’s SBIR program) asks the group who they think has a better shot at a Phase II: (a) the Phase I winner who has kept DOT informed of his/her progress, has asked for input, and has asked for help making contacts for Phase III; or (b) the Phase I winner who signed the SBIR contract and isn’t been heard from again until he/she is back at the trough asking for Phase II money? That doesn’t mean being a pest, and realize the level of communication with Phase I SBIR/STTR winners varies by agency and their project managers, but the "take the Phase I money and run" strategy is seldom the right approach. The word is "schmooze," and if you aren’t doing it in the Phase I project you are making a mistake.

Don’t be labeled as a Phase I whiner. No, that’s not a typo—we’re talking whiner rather than winner. Actually, Phase I whiners are a subset of Phase I winners—a whiner is a winner who contacts the awarding agency repeatedly with management woes, doubts about their own ability to perform the work, begging the agency to tell them how to overcome routine problems. Why would an SBIR/STTR agency want to prolong such agony by giving a whiner two more years of support under a Phase II award?

The Phase I priority clearly is to prove feasibility. However, it is also a critical time to prove yourself to the awarding agency.