Tom Temin: Ms. Bahar, good to have you on.
Mojdeh Bahar: Good morning. Nice to be here.
Tom Temin: Tell us about these grants. These are small businesses, innovation, I mentioned artificial intelligence — give us the scope of what you’re driving at here with these grants.
Mojdeh Bahar: Department of Commerce, basically, the National Institute of Standards and Technology and the National Oceanic and Atmospheric Administration are one of the 11 federal agencies that have SBIR or Small Business Innovation Research Programs. And this program basically has four broad goals. We want to further technological innovation, we want to help meet federal research and development needs. We want to encourage participation by minority and disadvantaged persons in technology innovation. And we want to increase private sector commercialization. Basically, we want our awardees to succeed by developing marketable products through the course of their project, through the course of their award.
Tom Temin: And this round of grants is aimed, I guess, generally at artificial intelligence and the application of it to some big problems.
Mojdeh Bahar: Yes, we have actually a very good example in this round that is quite relevant, given what’s going on in the western part of our country. We have a company called Reacts Engineering Inc, that will develop a wildfire modeling system that builds in initial attack modeling. That’s the decision on how to suppress fire immediately after it’s reported, and implements the smoke transport algorithm, quantifies potential risks and impacts using these new computational techniques. And the end result is that there will be a web portal that facilitates communication among stakeholders by providing reliable forecasts that is updated by first responders input. So that’s one application that was awarded during this round that is quite germane to what’s going on right now.
Tom Temin: Any other good examples?
Mojdeh Bahar: This round of awards actually covered many different industries, they included artificial intelligence, advanced manufacturing, biotechnology, cybersecurity, and detection of infectious disease. So this time, we really were lucky in that we had a very broad spectrum of industries and companies covered. And these awardees were in different states obviously, I think we covered 12 states, 12 or 13 states in this round. So not only did we have a geographic breadth, but we also had, as I mentioned, an industry and technology breadth in this time.
Tom Temin: And these are relatively small grants, I think 100,000 to 400,000. What is the deliverable from the first round or this round of funding to these companies?
Mojdeh Bahar: As you know, SBIR has a phase two as well. And so what we expect to happen in phase one, which are some of these awardees, is that we asked them to stablish the merit of their project. Which means is this a project that deserves funding in phase two? We asked them to show us this project is feasible and has commercial potential. So basically, the final deliverables vary per project, but results of phase one projects are the basis for further development and the award of the second round.
Tom Temin: Got it. And how would you characterize the companies, they’re small? Are they all minority owned? Give us a sense of the population of recipients.
Mojdeh Bahar: As you know, the Small Business Innovation Research is for small companies that are mostly US owned, so about 51% of the company needs to be owned by a US citizen, and they cannot have more than 500 employees. In our case at NIST, the awardees are technology based firms with strong research capabilities and 10 or fewer employees. In fact, this time 10 out of our 12 phase one awardees had 10 or fewer employees. And they are very new businesses, about 6 out of 12 awardees, phase one awardees, were established within the last five years. So they’re new businesses with a very small workforce small but mighty.
Tom Temin: And these companies do create intellectual property as a result of the grants. Do they keep it? Does it become something in the public domain? How is all that end of it handled?
Mojdeh Bahar: So as you know intellectual property is a rather complex issue. But generally SBIR awardees retain rights to all of the intellectual property that they develop during the award. The reason I say generally is because we have a type of SBIR word which is called SBIR technology transfer. And those are based on technologies that have already been conceived and reduced to practice at NIST. And a company comes, takes that technology and furthers it. So basically the first part of that, the first half of that technology, may be owned by NIST. And then whatever comes out of it, the SBIR award is owned by the company. So if they don’t do the SBIR-TT the company owns the property, if you do engage in SBIR technology transfer, NIST also has some ownership and inventorship rights.
Tom Temin: And where are we in this particular program? You mentioned there’s a phase one, which is almost the proof of concept and then phase two. We’re all in phase one at this point?
Mojdeh Bahar: Some of these companies are in phase one, and some are in phase two.
Tom Temin: And what, in general is the survival rate of people that get phase one funding that are able to prove proof of concept that it would have commercial value that go on to get that second award? And then what happens then?
Mojdeh Bahar: Usually, at that stage, these companies have not only, as you mentioned, proven that this concept is commercially viable — but by the end of phase two, we are hoping that they have a product that they can put on the market.
Tom Temin: Because I see in the list of awardees, some of them are phase one, but some of the same companies are in phase two. So that would be the phase two that they’re getting now was from an earlier phase one.
Mojdeh Bahar: That’s correct. And sometimes companies get phase two based on phase one from a different agency. So it doesn’t have to be from the same agency at times as well.
Tom Temin: What happens after phase two is completed, do they then presumably have a product and you wish them well to go out and sell as many copies as they can?
Mojdeh Bahar: Yes, we hope that they continue on their path to success.
Tom Temin: Alright. And what’s next for the SBIR program here?
Mojdeh Bahar: So this program was basically first established in 1982. And it was last authorized in 2017. The next authorization is going to come in September 30, 2022. So we hope that it continues as its first innovation and helps a lot of small businesses as we mentioned,
Tom Temin: Mojdeh Bahar is Associate Director for Innovation and Industry Services at the National Institute of Standards and Technology. Thanks so much.
Mojdeh Bahar: Thank you.