Take it for granted: need cash to develop your latest high-tech product? There's probably an SBIR grant for you

Entrepreneur, Jan, 2005 by David Worrell

A Passion for Products

Carron at DeltaNu has taken a radically different course through the SBIR process. Although he, too, relied heavily on the grants for early financing, the R&D work the grants paid for was always product-oriented.

DeltaNu's Inspector Raman product was developed with a Phase II SBIR grant from the NIH. The grant paid for research on the broad topic of how to detect illicit drugs. "In the process, we realized that even our bench-top model was too big," says Carron. "We needed something to be carried by police in the field."

The end result, a wireless, battery-operated system, has uses far beyond what the NIH ever imagined. The device has applications in law enforcement, hazardous materials management and homeland security, to name just a few. "It can be used to look for explosives, hazardous materials, weapons of mass destruction, or even to analyze artwork," says Carron. "It's nondestructive, so you could analyze a rare piece of art and never even have to take it off the wall."

With such broad applications, Carron estimates that Inspector Raman will generate revenue of $2 million or more per year for the company. Combined with other product sales, that's a nice return on the company's SBIR awards.

Street Cred

Whether you end up developing a blockbuster product or not, completing an SBIR grant means more than just money. Says Shindell, "Once you have become an SBIR award winner, you've gained an incredible amount of credibility for your company."

DAVID WORRELL is an investment banker and author of the e-book Finding Funding Contact him at david@ dworrell.com.