Applying for USDA innovation grants
by Patricia & Martin Bremmer, Windcall Manufacturing Inc. and GrainGoat
Photo by Patricia & Martin Bremmer
Over the past three years, we have received four grants for our work with our product the GrainGoat totaling more than $100,000. We currently have a grant proposal submitted for $600,000. People tell us how lucky we are to be receiving grants. We smile and say, “the harder we work the luckier we get”. You can’t just pick up the phone and tell the government you would like a grant to continue your work. It is a long and sometimes grueling process providing information in a concise manner.
When we began our research on USDA-SBIR grant writing, we were instructed to set aside approximately one-hundred hours to write our grant. Of course, we realized that was an over-dramatization. I’m an author so we knew we could write a grant in a fraction of that time! To write our first SBIR grant, it didn’t take one-hundred hours… it took closer to one-hundred and twenty hours (an entire month).
TIP 1: Give yourself enough time to complete proposal (a month or more). If you are applying for a grant don’t wait until the last minute. Start well in advance of the deadline, one month or more. And, be sure to submit your application no later than a week prior to the deadline. If you are one minute late, your application is disqualified. Ouch!
I know it take a lot of time BUT it’s worth it! We applied for an SBIR (Small Business Innovative Research) Phase I grant. The SBIR grant program was established by the Small Business Administration (www.sbir.gov) to assist new businesses with money for research and development of their new products. Grant money is preferred over investment money simply because you don’t pay it back and it is non-dilutive money--no equity lost.
TIP 2: Choose the right federal agency. The SBIR supports approximately 11 different agencies, including the USDA. Each agency has different requirements. Choose the correct agency to match your product. Thousands of applications are submitted each year.
TIP 3: Understand the goals of each Phase. SBIR has three phases. Phase I (product feasibility) for an agricultural grant is $100,000. Phase II (product development) is $600,000. Phase III aids in the commercialization stage of your project. For Phase III, it's important to show that your team is capable and you can raise non-governmental revenue. In Nebraska, we received a Department of Economic Development Phase 0 grant of $5,000 to cover the cost of preparing and submitting an SBIR grant. You can hire a grant writer or pay yourself. We paid someone to review our finished grant. Check with your state to see if a similar program exists. Be sure to choose the right phase (it’s probably Phase 1 or Phase 0, if that’s available).
TIP 4: Read the SBIR instruction manual (no…really). Approximately 14 percent of the applicants who applied to the USDA division were awarded a Phase I grant, that’s only one in seven. Of the successful Phase I awardees that apply for Phase II, only 50 percent receive a grant. The money, although extremely helpful, is not easy to obtain. The SBIR provides an instruction manual (41 pgs.) for preparing their grant application. It would be in your best interest to read it from cover to cover, highlighting as you go. Mark up the margins for points you don’t want to miss. If you don’t follow it to the letter, your application will not even be reviewed.
TIP 5: Support claims with facts. You can never have too many facts to substantiate your claims. Prove why your product is better and why it's likely to be a commercial success.
TIP 6: Follow the page guidelines. Be aware of the page limits for each section of the application. Do not exceed those limits.
OTHER THINGS TO CONSIDER
- Take it one step at a time.
- Do your homework.
- Have all of your research material and data prepared to enter into your application.
- Know your product and explain it well.
- Know your competition.
- Describe how it will help your target customer improve his or her way of life or business.
- Explain your company's ability to scale and commercialize your product.
We submitted our grant and nervously waited from the October submission date until we received a phone call in March telling us that we were the number one application in our division and our grant would begin in August (a year after we started our application). Unfortunately, there is no playbook that covers everything from bumper-to-bumper; you must do your own research every step of the way. There are many reporting deadlines. We were surprised at the amount of paperwork once you receive the grant. Remember you are working with the government.
A start-up company can really take off with a $100,000 grant. If you apply and are awarded a Phase II grant it can make the difference in whether or not your company becomes successful. We are currently in the waiting period until June 2017 when we learn whether or not we are in the group being awarded a Phase II grant. Fingers crossed, we hope all of our hard work will make us lucky again.
The Request for Proposals (RFP) for the USDA SBIR grant for Phase I will be posted in June and proposals will be due in October. Check out the USDA SBIR program website to access webinars and other information about the program.
Patricia & Martin Bremmer are cofounders of Windcall Manufacturing, Inc., a company that designs agriculture technology for farmers and researchers including GrainGoat. GrainGoat is a miniaturized, handheld grain combine that helps growers test the moisture of their grain. Windcall Manufacturing, Inc. competed in the Rural Entrepreneurship Challenge and was a finalist who competed in the final Challenge round. Windcall Manufacturing has successfully applied for a series of SBIR grants, including a 2016 grant.