12 



The second stage consisted of intensive assistance in putting to- 

 gether sound, clear and concise visual materials describing a busi- 

 ness opportunity that could be presented in 20 minutes to potential 

 sponsors. The participants also practiced and received critiques on 

 their presentations. 



In the third and final stage, a commercialization opportunity 

 forum was held in which about 25 companies made individual pres- 

 entations to about 60 decisionmakers from large corporations and 

 venture capital firms in an effort to interest them in either joint 

 ventures, licensing, venture capital investments or other teaming 

 arrangements. 



One-on-one sessions between the SBIR awardees and the poten- 

 tial sponsors were also held at the forum and these sponsors in- 

 cluded Boeing, Dupont, General Dynamics, Westinghouse Electric, 

 Xerox, and many venture capital firms. 



As a result of participation in the 1991 project, the small compa- 

 nies have already received more than $14 million for commer- 

 cialization of their research with a projected royalty stream of an 

 additional $24 million from option agreements over the next 4 

 years. About 43 percent of the firms that completed the project 

 have received further funding for their work. All of the companies 

 that participated in the project over the last 6 years have devel- 

 oped skills in business plan development and these skills will be 

 very useful in pursuing other commercial opportunities, including 

 future SBIR projects from any Federal agency. Both the SBIR 

 awardees and potential sponsors felt the project was very worth- 

 while. 



Next I would like to describe our unique system of maintaining 

 continuity of funding between Phases I and II. In planning the 

 awards of Phase II grants, attention was paid to the potential cash 

 fiow problem that a small business would experience if it were to 

 suffer a hiatus in funding between Phases I and II. Such a gap in 

 funding is most difficult for businesses that are either very new or 

 very small. 



In our first year of Phase II awards in 1984, a system was de- 

 vised and implemented that allowed Phase I awardees to submit 

 their Phase II proposals before their Phase I grants ended, if they 

 felt they were ready to do so. For each of the 12 years in which 

 Phase II awards were made, such grantees who were chosen for 

 Phase II funding, were able to begin their projects with no inter- 

 ruption in funding between the phases. 



Since 1984, 35 percent of our Phase II awardees have had contin- 

 uous funding between Phases I and II, and this DOE-developed 

 system has received very favorable reaction fi-om the small busi- 

 ness community. Concerning on-time perfo7*mance, during each of 

 the programs 12 years, we have issued every solicitation on sched- 

 ule and met every deadline for the selection of Phase I and Phase 

 II awards. 



Now I would like to make two suggestions for improvements in 

 the program. To increase the return on the Government's annual 

 investment of nearly $1 billion in the SBIR Program, we believe 

 that at most 1 percent of the SBIR set aside should be used to fund 

 projects like the DOE commercialization assistance project and to 

 provide administrative support for the program. The SBIR reau- 



