Both the individual inventor and the small, high technology firm face major obstacles during process of creating, developing, and commercializing an innovation-of turning ideas into dollars. Ideas into Dollars is aimed at making those obstacles less intimidating. By providing you as inventors and small business managers with information on the variety of government and private organizations, programs, and publications dealing with invention and innovation, the SBA hopes to in crease your chances of commercial success.
The contents of this publication are organized to be quickly accessible: the process of innovation, along with the appropriate resources, is laid out in successive stages from invention through commercialization. The resources listed in this Guide should help you as an inventor or small business owner or manager to mix effectively the four essential ingredients necessary for turning ideas into dollars: 1) determining technical feasibility, 2) assessing market demand, 3) identifying capital sources, and 4) developing overall management competence.
We suggest you skim this Guide, determine the stage you are in, and then "dive into" the wealth of information available from the resources listed. As advocates for small business, we understand the complications faced by an inventor or innovative firm when dealing with Government Agencies. The purpose of writing Ideas into Dollars is to help you deal effectively with all the complexities, blind alleys, and frustrations that are frequently a part of working with Federal Agencies, corporations and other larger organizations. By explaining whom to contact and what procedures to follow, this Guide should help the innovation process flow somewhat more smoothly.
Acknowledgements
Several individuals in both Management Assistance and Advocacy were principal contributors. Barry Unger, of Innovation Support in Arlington, Mass., a Presidential Exchange Executive at SBA during 1979 80, was the publication's Technical and Science Advisor and Jerry Feigen, Advocacy's Associate Advocate for Capital Formation and Venture Capital, was the liaison between Management Assistance and Advocacy. Dr. Bruce Whiting, Director of Program Delivery for Management Assistance, was the originator of the project and Gregory Dielcks, Writer Editor, Support Services Branch, was the Project Director.
Your Help Requested
Readers who are aware of any additional resources, whether publications, programs, or organizations, which would be of use to inventors or small, high technology firms, are requested to please send a full description of them to:
Ideas Into Dollars U.S. Small Business Administration (MA/SSB) 1441 L Street, NW Washington, D. C. 20416
The information contained in this publication was current at the time of writing. However, over time, programs change, publications come and go, organizations are restructured, and offices move. While every effort has been made by SBA to assure accuracy, some of the specific information may become dated.
Invention Stage
Idea Generation Phase
Idea generation has two interrelated components: the psychology of creativity, and the organizational encourage ment and promotion of new product ideas.
The thrust of this Guide is not to describe the nature of creativity, although creativity is the basis of invention. For those interested in studying creativity, there are many publications on its psychology. Most university and large local libraries will reference them. The American Psychological Association, 1200 17th Street, N.W., Washington DC 20036, (202) 833 7600, publishes a broad range of journals and indexes. It welcomes inquiries. The Creative Education Foundation, Inc., 1300 Elmwood Avenue, Buffalo, NY 14222, located at the University State College, has an extremely extensive library of reference materials on creativity. For further information write or call (716) 878 6221.
This Guide also does not presume to tell the small, high technology firm or the individual scientist, engineer, or technician how to arrive at new ideas, whether individually or organizationally. This Guide, however, does provide detailed advice on the resources available for use during the process of turning ideas into doUars-once the initial idea has been created.
Idea Evaluation Phase
Idea evaluation is the first major step after a concrete, detailed idea has been developed. This is a critical phase since every following phase requires the investment of more time and money. The purpose of an idea evaluation is to determine the overall technical and commercial feasibility of an idea-what its full potential actually is.
These evaluation activities seek to determine whether the fledgling invention is a marked improvement over its competition; whether it is likely to be commercial viable; what the probable demand for it will be; who could produce it, and how it would be distributed. The ultimate purpose here is to arrive at the decision to go ahead to the commercialization stage, to redesign the invention, or to kill the project altogether.
There are both private, money making organizations and public or quasi public organizations like innovation centers that can assist the inventor at this stage. The money making organizations include invention brokers and consultants, some of whom are in the business not only of bringing the inventor and buyer together-an aspect of commercialization-but also of helping evaluate the technical and commercial aspects of the invention or idea. Some work for a set fee. Others work on a contingent fee basis. This means that while the technical/commercial evaluation may be free, they will receive a percentage of the profits-but only if there are profits. These private organizations are discussed in more detail in the Com mercialization Stage, see page 7.
On the non profit side, several types of organizations can help evaluate inventor~s ideas, both technically and commercially but, unlike invention brokers, they are either free or charge a nominal fee. You should not become discouraged if a negative evaluation is received. Since there is no standardized evaluation system, try someplace else. However, any limitations cited by the evaluation reviews should be considered by you when determining ways to improve upon your invention. Among these public and quasi public evaluation organizations are: universities, Government Agencies, inventors' associations, and corporations (since they generally do not charge to develop a promising idea.)
University Evaluation Centerx Many universities have formal programs specifically designed to assist individuals with ideas for new or improved products or services. Nearly every state has a least one college or university that can provide research and development facilities to technically oriented companies or individuals. Listed below are the principal university evaluation programs whose purpose it is to promote innovation, invention, and product development.
MIT Enterprise Forum
Alumni Center
77 Massachusetts Avenue
Cambridge, MA 02319
(617) 253~240
A non profit organization affiliated with Massachusetts Institute of Technology. Provides entrepreneurs~officers of technically oriented businesses with one time (with occasional follow ups available] evening panel discussions or "clinics" organized around a review of their startup or ongoing business, its plans, and the critical problems or issues it faces. Panels consist of 5 to 6 successful entrepreneurs and experts from industry, academia, and government who are recruited specifically to address the technological and business issues of the case at hand. The effort is made to have a panel broad enough to give a full perspective on the characteristics and opportunities of the entrepreneur's business. The nature of pro blems that companies have sought advice on has ranged from organizational strategy, to marketing, to financing, to managerial style and succession, to staffing, to increasing profitability, to requests for a general review of company opera tions or a review of a new company's business plans. Most of the approximately 30 companies served so far have found the "clinic" experience helpful. Sessions currently are held in the New York and Boston areas. Special arrangements, however, can be made to accommodate those companies based in other locations. A fee of $100 to defray expenses is charged to companies who are accepted for presentation to the Enterprise Forum.
The M.I.T. Enterprise Forum also runs occasional other activities such as a day long program with workshops on Financing Technology Based Organizations. Businesses entrepreneurs seeking assistance should contact Paul E. Johnson (Executive Director), Arthur C. Parthe Jr., Stanley R. Rich, or Barry Unger at the above address.
The University of Kansas Center for Research, Inc. 2291 Irving Hill Road Campus West Lawrence, KS 66045
The Center offers an interdisciplinarv approach to solving technical problems companies often encounter when developing new products. Those interested should write the Center brief explanation of their needs.
Carnegie Mellon University
Center for Entrepreneurial Development
4516 Henry Street
Pittsburgh, PA 15213
(412) 621 3940
This Center aids inventors and business owners in overcoming problems related to new product development. Provides technical advice and idea evaluation.
Massachusetts Institute of Technology
Innovation Center
Room 33 111
Cambridge, MA 02139
(617) 253 6947
The Center evaluates and screens innovations. Emphasizes idea evaluation and start up problem assessment. Students are heavily involved in this Center's programs.
University of Utah Utah Innovation Center Office of Business 391G So. Chiteta Way Salt Lake City, UT 84112 (801) 581 3433 Assists inventors with development of their ideas. Screens and evaluates new product ideas and provides assistance in writing business plans.
California State University at Fresno
Bureau of Business Research and Service
Fresno, CA 93740
(209) 487 2352
Conducts research on small business problems. Provides consulting services for small businesses.
Industrial Technology Research and Development Foundation
(ITRAD)
P.O. Box 1335
132 No. l2th
Durant, OK 74701
(405) 924 5094
A federally funded, non profit, Oklahoma State University
affiliated evaluation center supporting south central United
States. Performs idea evaluations and commercial feasibility
analyses.
Center for Private Enterprise and
Entrepreneurship
Hankamer School of Business
Suite 308
Baylor University
Waco, TX 76703
817) 755 3766
Offers an Innovation Evaluation service aimed at determining commercial feasibility. A nominal $50 fee is required.
Center for New Business Executives Innovation Center P. O. Box 12793 Research Triangle Park, NC 27709 (919) 549 8193 An independent, state affiliated organization, closely associated with the University of North Carolina. Provides
training and management assistance to new and potential entrepreneurs.
Wisconsin Innovation Service Center A Service of the University of Wisconsin Small Business Development Center
402 McCutchan
University of Wisconsin
Whitewater, WI 53190
(414) 472 1365
For a $75 fee, performs an extensive preliminary commercial feasibility analysis.
Center for Innovation and Entrepreneurial Development 209 Classroom Building University of California Santa Cruz, CA 95064 (408) 4Z9 2980
Provides credit and non credit seminars and practice sessions on idea evaluation and invention management.
The Small Business Administration's Division of Management Assistance, 1441 L Street, NW, Washington, DC 20416, sponsors a nationwide, university based Small Business Development Center program. These Centers provide a wide range of management assistance to inventors and small, high technology firms, including idea evaluation. Appendix 9 lists these Centers and their phone numbers. Contact the Center in your area for more information.
Not all evaluation centers respond immediately; so, as an inventor, do not become discouraged if your letters are not always answered. Perseverance is important.
Government Evaluation Offices National Bureau of Standards, Institute of Applied Technology, Office of Energy Related Inventions (OERI), Department of Commerce, Washington, DC 20234, (202) 921 1000.
The NBS Energy Related Invention Evaluation Program aims at encouraging innovation in developing non nuclear technology. The program evaluates all promising energy related inventions. NBS does not offer grant assistance but rather acts as a screening and referral agency for the Depart ment of Energy (DOE) which does provide funding. Interested energy oriented inventors may write to OERI for a complete information packet containing the appropriate application forms and a full description of their evaluation process. The DOE grant program is discussed in the Government Grant Pro grams section of the booklet, see page 9. It should be mentioned that this NBS evaluation program is a lengthy process which recommends about 11/2 percent of the submissions to WE. WE, however, funds nearly all those recommended.
NBS's Office of Energy Related Inventions also has an Inventor Information Resources Center pilot project. Three public libraries, Boston Public Library, Sunnyvale (CA) Public Library, and Price Gilbert Public Library (Atlanta, GA) are to act as depositories for and access points to a wide range of computer accessible data, instructional and technical information. These libraries are also Patent Depositories. Contact NBS for more information.
The Small Business Administration is funding three Innovation Centers to help inventors and small, high technology firms develop and market their innovations. These Centers are similar to the University Evaluation Centers but offer a much wider range of services. The SBA Centers not only can provide engineering, design, and testing assistance, they also offer management assistance in such areas as market research and planning, production planning, personnel management, financial accounting systems development. and venture capital source analysis. These services span the entire invention commercialization continuum. Each Center has a different orientation. For more details contact:
Innovation Center Commercial Credit Management Corporation 300 St. Paul Place Baltimore, MD 21202
This Center emphasizes high technology products like electronics.
Center for Innovation
PO Box 3809
Butte, MT 59701
(406) 494 6100
The emphasis here is on new products and inventions related to energy, agriculture, and mining.
Golden State Energy Center
Bldg. 1055
Fort Cronkhite
Sausalito, CA 94965
(415) 561 7692
This Center works primarily with San Francisco based firms in the area of renewable energy products and processes. The Center works closely with the Department of Energy, and other Federal and State Agencies.
Inventors' Associations Inventors' Associations provide advice on a new product development, idea evaluation, etc. They frequently publish newsletters so inventors can keep in touch with each other and with the new trends in engineering design. They also advertise inventions. Listed below are some of these associa tions. You can use these associations to talk with people "who have gone through it all before" and can give advice on other sources of help.
American Society of Inventors
134 Narberth Avenue
Room 101
Narberth, PA 19072
California Inventors' Council
Box 2096
Sunnyvale, CA 94087
Central Florida Inventors' Club
2511 Edgewater Drive
Orlando, FL 32804
Inventors' Assistance League
345 West Cypress
Glendale, CA 91204
Inventors of California/National Innovation Workshop P.O. Box 158 Rheem Valley, CA 94570
Inventors' Workshop International Box 251, Tarzana, CA 91356; and 32 22 92nd Street Oueens, N.Y. 11369
Minnesota Inventors' Congress
Box 71
Redwood Falls, MN 56283
Mississippi Society of Scientists & Inventors Box 2244 Jackson, MS 39205
Oklahoma Inventors' Congress
Box 53043
Oklahoma City, OK 73162
Technology Transfer Society
11720 W. Pico Boulevard
Los Angeles, CA 90064
Corporations Many corporations, due to legal complications among other reasons, make it their policy not to review ideas coming from the outside-at least the likelihood is remote. However, if you have a well developed idea and are looking for a larger company to evaluate, manufacture, and/or sell it, then you should consult reference publications like Thomus' Register of Manufacturers, Dun ~ Bradstreet directories, MacRae's Blue Book, for the names, addresses, phone numbers and product orientations of the various companies.
To submit ideas to companies not specifically oriented to handle inventions, you may find useful a publication by the American Bar Association's Section of Patent, Trademark & Copyright Law entitled, "Submitting an Idea." It describes the usual procedures involved in submitting an idea to a company. Copies are available for a nominal fee from:
Circulation Department
American Bar Association
1155 East 60th Street
Chicago, IL 60637
Publications on Idea Evaluation See: Books section, page 13, for materials on Invention Management.
Guide to Invention and Innovation Evaluation, Gerald G. Udell, Michael F. O'Neill and Kenneth G. Baker. GPO. Superintendent of Documents, Government Printing Office, Washington, DC 20402. $3.50. Stock Number 038 000 00411 5.
The Lightbulb, Inventors' Workshop International, Box 251, Tarzana, CA 91356.
Commercialization Stage
The Commercialization Stage Phases include Protection and Legal Assistance, Financial Assistance, Management Assistance, and Production and Sales Assistance.
Protection and Legal Assistance Phase
Now that the invention has passed through the official agency where this is legally executed. Written correspondence should be sent to Patent and Trademark Office, Washington, DC 20231 or phone (703) 557 3158.
The Patent Office provides several services for the inventor, in addition to patent protection. First, it has a Document Disclosure Program which permits the certified storage of papers for up to two years. This certified storage not only keeps safe important papers but also provides evidence of the date of the conception of inventions.
Second, before an inventor can obtain a valid patent, a search of pending patents must be made. The staff of the Patent Of fice will assist the inventor in this search, which can be done by going to the Search Room, Crystal Plaza, 2021 Jefferson Davis Highway, Arlington, Virginia. There are also 29 Depository Libraries in the U.S. They keep complete files of all U.S. patents. See Appendix 1 for a listing. A search can be done at any of these libraries if more convenient.
Third, an official roster of all registered practitioners who prepare and prosecute patent applications for inventors is available (see: Government Publications below).
Fourth, for a small fee, the patented invention can be advertised, in the Patent Office's official Gazette, as being available for licensing or sale. The Gazette is widely circulated among manufacturers, research companies, and business owners. A Gazette entry includes the patent number, the name of the invention, and the inventor's name and address. And fifth, every February, in conjunction with National Inventors' Week, an inventors exposition is sponsored. Write to the Patent Office for complete information.
In addition to these five Government patent services, an important new law has been enacted. PL9~517 now allows small businesses to retain title (ownership) to an invention created with the help of Federal funds. So today, if a small business develops a patentable product or process while being funded by a National Science Foundation grant, for example, that firm can patent and profit from its invention.
Government Publications on Patents and Protection The U.S. Department of Commerce, Patent and Trademark Of fice, Washington, DC 20231, publishes the following booklets.
For information on obtaining item, write or call (7(~3) 557 3158.
Patents and Inventions: An Informal Aid for Inventors.
The Disclosure Document Program.
Questions and Answers About Patents.
Attorneys and Agents Registered for Practice before the U.S. Patent Office.
Official Gazette of the U.S. Patent Office.
Technology Assessment and Forecast.
Patents and Government Developed Inventions.
General Information Concerning Patents.
Patent and Trademark Office Notices.
The National Technical Information Service of the Department of Commerce, is the central source for the public sale of government sponsored research, development, and engineering reports prepared by Federal Agencies or contractors. NTIS has on line search, bibliography and hard copy production capabilities. An especially useful NTIS publication for high technology firms is Government Inventions Available for Licen sing. For full information about NTIS write: NTIS, 5285 Port Royal Road, Springfield, VA 22161 or call (703) 487 4600.
The Small Business Administration offers two free publications on idea protection-MA 6.005 Introduction to Patents and SBB 90 New Product Ideas. Request copies from SBA, P.O. Box 15434, Ft. Worth, TX 76119.
Non-government Publications on Patents and Protection Abernathy, David and Wayne Knipe. Ideas, Inventions and Patents. Pioneer Press, P.O. Box 76025, Atlanta, GA 30328.
Bush, George P. and Robert H. Dreyfuss, editors. Technology and Copyright: Sources and Materials. Lomond Publications, P.O. Box 88, Mt. Airy, MD 21771.
Grosswirth, Marvin. The Mechanics Illustrated Guide to How to Patent and Market Your Own Invention. New York David McKay Co., 1978.
Jones, Stacy V. The Inventors Patent Handbook. The Deal Press, 750 Third Avenue, New York, N.Y. 10017.
Pressman, David R. Patent It Yourself! How to Protect and Market Your Inventions. New York McGraw Hill, 1979.
Taylor, Clarence R. How to be a Successful Inventor Patenting, Protecting, Marketing, and Selling Your Invention. Hicksville, NY: Exposition Press, 1979.
Patent Licensing Gazette/Technology World. Technical Research Associates, Inc., Willow Grove, PA 19090.
Financial Assistance Phase
Funding is critical to the continued development of an invention, new product idea, or new method of doing something. The resources identified in this section can help you as an inventor or small firm in several ways: by supplying the funds needed to bring an invention into commercial production (venture capital companies, investment bankers, lenders, etc.), by negotiating for the inventor with these financial sources (brokers),or by giving grants for the continued development of an already well thought out idea ~Government grants.) Grants should not be confused with procurement. The next section of this publication, Production and Sales, deals with Government procurement; here we are discussing grant programs only.
Venture Capital Organizations Venture capital is another name for the funding needed to start a new business (based on your invention) or expand on existing one (again, based on an invention or new product idea). Traditional lenders like banks and savings and loan companies frequently resist becoming financially involved in such risky undertakings. However, there are several types of venture capital organizations that thrive on the uncertainties of starting a business. These organizations usually want their equity investment (as opposed to a straight loan) to be easily convertible to cash at some future date, and they will take a much more active role in managing the new or expanded business than traditional lenders since they may now own some of your common stock or a share of your business in return for the loan. There are several principal sources of venture capital:
1) Venture Capital Companies privately or publicly held
businesses;Small Business Investment Companies (SBlC's~SBA licensed investment firms whose purpose is equity and risk, long term capital lending. For more information on SBlCs, ask your SBA field office for SBIC Financing for Small Business, OPC 13;
Large Corporations;
Investment Bankers and Bank Trust Departments in re cent years more emphasis has been placed on venture capital funding by banks. Check with your local Chamber of Commerce, SBA or Department of Commerce field office, or your local banker for further information;
5) Insurance/Pension Plan Funding probably not of too
much use for direct assistance as they lend to the lenders
but worth investigating if you need a large sum; and
6) Public Funding the traditional sale of stock ownership
through the public equity market.
To grant venture capital funding, these lenders will require from you a solid business plan. These organizations, it should be remembered, are interested in funding promising inventions or products, not in evaluating or developing ideas. So you will need a well thought out plan which describes the general nature of your new product, the structure of your business, the market for your product. its competitive superiority along with your production, sales and distribution plans, including revenue, costs, and profit projections. All these are required as a basis for your loan negotiation.
There are several listings of venture capital companies. One of these is published annually in the December issue of Venture Maganzine, entitled "Venture Capital Directory." Copies can be
obtained by writing Venture Magazine, Special Projects Department, 35 West 45th Street, New York, NY 10036, phone (212) 840 5580. There is a nominal charge for the listing. Two recent books with extensive listings of venture capital companies, their addresses, phone numbers, product orientation, and so forth, might also be useful. One is a Guide to Venture Capital Sources (5th edition), Stanley E. Pratt, editor, 1981, Capital Publishing Corporation, Two Laurel Ave., P.O. Box 348, Wellesley Hills, MA 02181. The other is entitled Planning and Financing Your New Business: A Guide to Venture Capital, John McKiernan, 1978, Technology Management, Inc., P.O. Box 230, Chestnut Hill, MA 02167.
There are also two national trade associations of venture capital companies. The National Venture Capital Association (NVCA), Suite 750, 1225 19th Street, N.W., Washington, DC 20036, (202) 659 5756, is interested in stimulating the free flow of capital to new and growing small businesses. Inventors and innovative small firms may wish to ask NVCA for advice on venture capital matters. The NVCA membership list of venture capital companies also might be worth requesting. The Na tional Association of Small Business Investment Companies (NAS81C), 618 Washington Building, N.W., Washington, DC 20005, (202) 638 3411, publishes a Membership Directory (of the SBA underwritten SBICs referred to earlier on page 8) giving company name, address, phone numbers and industry preference. The Directory costs $1.00.
Government Grant Programs The Federal Government has a very complex system of grant programs. Nearly every Agency offers some kind of grant fun ding. In this section, coverage is limited to Project Grants, (research, technical assistance, training, unsolicited contractual agreements, etc.), Direct Payments, and Loan Assistance. Contracting for procurement of goods and services is covered in the Government Procurement Programs part of the Production and Sales Phase. Appendix 2 provides a summary of how to apply for Federal grants. Some of the principal grant oriented publications and programs include:
National Science Foundation NSF) Grants
The NSF, Publications and Grants Applications Office, 1800 G Street, N.W., Washington, DC 20550, phone (202) 357 7861, makes available several key publications which detail their own and other Agencies' R&D grant programs. They include the NSF Bulletin (monthly), the Guide to Programs, the Grant Policy Manual and the Small Business Guide to Federal R~D.
A key office, the one that publishes Small Business Guide to Federal R~D, is the Office of Small Business Research and Development. It acts as the ruxus between the scientific/technological elements of the small business community and NSF grant and procurement programs. This is a very useful contact for high technology small firms and can describe many of the NSF programs such as the new Small Business Innovation Research Program. For complete information on the activities of this office contact the Director, Small Business R&D Office, NSF, Room 1121, Washington, DC 20550, phone (202) 357 7527.
The Engineering and Applied Science Directorate (EAS), publishes Program Solicitation for Small Business Innovation Resear~h, NSF 79 59. This booklet describes the EAS grant pro gram aimed at supporting advanced research in the general areas of applied science and engineering (excluding product development, technical assistance, pilot plant development, clinical and weapons' research) that could have significant public benefit if successful. Initial grants are in the $25,000 range, with more money possible at later stages. The Small Business Research and Development Office should be contacted for complete information on this program.
In addition to EAS Directorate programs, another key NSF grant program is the Appropriate Technology Program, which is aimed at strengthening the science base for appropriate technology development. For more information contact the Director, Appropriate Technology Program, Room 1108, NSF, 1800 G. Street, N.W., Washington, DC 20550, phone (202) 357 7491.
Department of Energy Grants
Within Department of Energy, Washington, DC 20585, (202) 252 5000, there are several grant type programs aimed at developing energy related technology. NSF's Small Business Guide to Federal R~D lists the DOE programs that relate to research and development. The following are some of the principal DOE grant programs:
The Appropriate Technology Small Grants Program funds projects that are of small scale, decentralized, and energy related. The major types of projects include: Concept Development where awards of up to $10,000 are granted to develop new ways to simplify or streamline energy use; Development where up to $50,000 is granted to test the new ideas; and Demonstration where up to $50,000 is granted for actual use testing. It should be borne in mind that less that 5% of those inventors seeking grants actually are awarded them. For further information contact: DOE, Office of Inventions and Small Scale Technology, Appropriate Technology Small Grants Pro gram, Room 6G040, 1000 Independence Avenue, S.W., Washington, DC 20585, phone (202) 252 9104. Since this pro gram is administered through the regional offices, the fastest response probably can be gotten by contacting your local DOE Regional Office. See Appendix 3 for a listing.
Another program sponsored by the Office of Inventions and Small Scale Technology of DOE provides the inventor with grants for continued research, development, modeling, hiring of consultants, etc. It is a part of the previously described NBS/DOE Energy Related Inventions Program. This Office considers grant requests only after a favorable evaluation by the National Bureau of Standards' Office of Energy Related Inventions. Therefore, to apply for these particular grants, do not contact DOE directly, go to the NBS first. NBS will thoroughly evaluate your invention and then forward your request to DOE if it is favorably evaluated. You should remember that only 10% of all evaluations by NBS are favorable. However nearly all of the favorable evaluations are funded by DOE. This NBS/DOE evaluation/grant program offers one time, one year grants ($80,000 average) to support non nuclear, energy related inventions. (Turn back to page 5 for information on the NBS evaluation program. For more information the DOE grant pro gram, contact either NBS or call DOE at (202) 887 8258.)
Department of Commerce Grants
The US Department of Commerce's Office of Minority Business Enterprise sponsors several Special Project programs. The Technology Commercialization Program, for example, promotes new, high technology, minority small business opportunities. For further information contact: OMBE, Department of Commerce, 14th Street between Constitution Avenue and E Street, N.W., Washington, DC 20230, phone (202) 377 3024.
The National Oceanic Atmospheric Administration has a National Sea Grant Program that funds marine research. For fur ther information contact: NOAA, National Sea Grant Program, 6010 Executive Blvd., Rockville, MD 20852, phone (301) 443 8290.
The National Bureau of Standards offers grants for technical research and development on methods and approaches in the area of engineering and applied science. NBS' funds are granted by way of unsolicited proposals, that is, an unsolicited written offer by a business or individual to perform engineer ing and applied science research. Such proposals must contain a detailed description of an effort that will enhance NBS' research and development mission. It can not be an effort related to advertising or standard commercial product development. For further information ask for Guidelines for Preparation of Unsolicited Proposals from: National Bureau of Standards, Office Management Division, Technical Proposals Coordinator, Building 301, Room B126, Department of Commerce, Washington, DC 20234, phone (301) 921 3521.
Department of Defense (DOD) Grants
DOD has a new program aimed at utilizing small, high technology firms to solve complex scientific/technical problems facing the national defense community. Phase I funding for preliminary R&D is up to $50,000. Phase II funding for advanced development is up to $500,000. Phase III consists of DOD production awards or commercial applications. For further information contact DOD, Director for Small Business and Economic Utilization Policy, Office of the Under Secretary of Defense for Research and Engineering, Rm 2A340, Pentagon, Washington, DC 20301.
Important Financial Assistance Publications There are several important publications for those interested in learning more about the various sources of Federal financial assistance. The Catalog of Federal Domestic Assistance, Executive Office of the President, OMB, Washington, DC 20503, for sale by the Superintendent of Documents, GPO, Washington, DC 20402, is the basic reference tool needed to understand the entire Federal system of grants and financial assistance. (This book does not deal with procurement information.) The Catalog describes all the Federal programs of all Agencies, with programs cross~indexed by subject, purpose, name, functional classification, eligibility requirements, etc. Also detailed are the types of assistance available, how to apply for assistance, how to write proposals and other sources of information. The Catalog is available through GPO, at many State and local government offices, in Federal Agency field offices, and at major libraries.
The Small Business Administration, 1441 L Street, N.W., Washington, DC 20416, publishes many pamphlets useful to inventors and small businesses seeking financial assistance. Free copies can be ordered from SBA, P.O. Box 15434, Fort Worth, TX 76119. Refer to the specific title and number.
MA 1.001 The ABC's of Borrowing
MA 2.007 Business Plan for Small Manufacturers
MA 1.00~Venture Capital Primer for Small Business
Another useful SBA publication on financial assistance is en titled Small Business Guide to Federal Financial Assistance. Copies can be obtained by writing the Director, Office of Information, Bureau for Advocacy at the Washington, DC address or by calling (202) 653 6273.
The following SBA publications are sold by the Superintendent of Documents, Government Printing Office, Washington, DC 20402. (For current prices and mail order form, write: SBA, P.O. Box 15434, Fort Worth, TX 76119 and ask for SBA 115B, "For Sale Booklets".)
SBMS Small Business and Government Research and
Development
SBMS 39 Decision Points in Developing New Products
Other key Federal financial assistance publications are:
OM8 Circular Nos. A 21, A 95
Parts I and III, A 102, A 110
A 111 and FMC 744
Publications Office
Office of Administration
726 Jackson Place, N.W., Room G 236
Washington, DC 20503
Guide for the Submission of Research and Development Proposals by Individuals and Organizations Other than Educational Institutions Department of Energy Washington, DC 20585
Guidelines for the Preparation of Unsolicited Proposals
Research Applied to National Needs Program
National Science Foundation
Washington, DC 20550
Treasury Circular 1082
Department of Treasury
Budget and Program Analysis, Room 2449
Washington, DC 20220
United States Government Manual
Superintendent of Documents
U.S. Government Printing Office
Washington, DC 20402
Sources of Funds for Solar Activities
Center for Renewable Resources (Not governmental)
1001 Connecticut Avenue, N.W., 5th Floor
Washington, DC 20036
(202) 466~880
NASA Grant Handbook (NGH) NASA Procurement Regulations (NAPR) Superintendent of Documents Government Printing Office Washington, D.C. 20402 (202) 783 3238
The Securities and Exchange Commission's Office of Small Business Policy offers several publications discussing the Federal securities laws small firms must comply with when raising capital through public security sales. Relevant publications include: Small Business, Capital Formation, and the Federal Securities Lows; S18; Rule z40 and 242; Regulation A; and Q ~ A: Small Business and the SEC. Single copies can be obtained by writing the Small Business Policy Office, 500 North Capitol Street, Washington, DC 20549. For multiple copies send requests to the Publications Office. The SEC phone number is (202) 272 2644.
State Government Sources of Information on Federal and State Grant~ There exists at the state level, a central source of information about Federal grants and grants awarded by States and localities. The State Central Information Reception Agency (SCIRA) is an office or unit of State government designated by the Governor to receive notification of grant awards issued under the provisions of Treasury Circular 1082. Federal Agencies are required to notify the appropriate SCIRA in each State of Federal financial assistance awarded, any subsequent related transactions, changes in the value or duration of a grant, or Federal grants awarded to States or localities. The SCIRA in each State is set up primarily to serve the Governor and the legislature. The extent to which it is equipped to serve others such as local governments or the general public varies from State to State. See Appendix 4 for another computer based source of Federal grant information available in most States.
Management and Technical Assistance Phase
Invention Brokers and Consultants Whereas the major purpose of the venture capitalist is to lend money and obtain an equity holding in a company, invention brokers and consultants' principal role is to bring together a seller (inventor~ and a buyer. However, they also may supply expertise on new product development and financial management, and some help fund the continued development and production of new products.
Most brokers/consultants work solely on a contingent fee basis; that is, they receive a percentage of the revenues generated by the invention. If the new product produces no sales, they earn nothing. Obviously, these organizations are very careful about what they will back and for how long.
Much as been written recently about the suspect business practices of some invention brokers. A word of caution should be mentioned: Some inventors have found themselves in difficulties when dealing with some brokers because the inventors signed contracts calling for them to supply up front money. After the money is paid, very little financial or technical assistance is given, in some instances. Before signing any contract, it is strongly recommended that you consult with your attorney or banker.
If you have any questions as to the reputation of an invention broker, check with the Federal Trade Commission by writing: FTC, Bureau of Consumer Protection, 6th and Pennsylvania Avenue, N.W., Washington, DC 20580 or call (202) 523 3844. Checking with your local Better Business Bureau or consumer groups might also be prudent.
Below is a listing of some of the major invention broker/consultant organizations. For a much more extensive listing see: Consulting and Consulting Organizations Directory, 4th ed., Paul Wasserman and Janice McLean, editors, Gale Research Company, Book Tower, Detroit, MI 48226. Look under Field 82, New Ventures.
Batelle Development Corporation (BDC) 505 King Avenue Columbus, OH 43210 (614) 424 6424/7446 BDC also runs a commercial feasibility analysis.
Business Growth Services General Electric Company 120 Erie Blvd., Room 380 Schenectady, NY 12305 (518) 385 2577 General Electric's Business Growth Services department offers to innovative businesses new products and processes available for licensing or outright purchase. In Selected Business Ventures and New Business Digest, GE lists their own and the pro ducts and processes of all other leading companies, laboratories, and universities that are available. These listings provide detailed information on licensing/purchasing arrangements, market outlook, development status, and contacts. New Business Digest Annual provides the names, addresses, and phone numbers of many of the leading technology oriented businesses.
Arthur D. Little Enterprises Acorn Park Cambridge, MA 02140 (617) 864 5770/2254 Arthur D. Little's Invention Management Group welcomes inventions from outside sources. It provides a full range of (free) services to the inventor from detailed technical evaluations, to commercial potential assessments, to making licensing arrangements. Arthur D. Little usually acquires the exclusive right to license an invention and negotiates all commercial agreements for the inventor. Request Invention Management and related publications if you want further information.
Control Data Corporation Technology and Information Services P.O. Box o HQV001 Minneapolis, MN 55440 (612) 853-3575/800 328-1870 Toll Free
Technology and Information Services offers consulting, technology management and research services to assist business identify its opportunities. An integral part of these services is TECHNOTEC, a world wide, computer based, technology data base, accessible via telex, TRW, computer terminal, phone or
mail. A small firm can use the TECHNOTEC data base to search for needed technologies, available licenses, or joint ventures and can make their technologies and inventions available to other companies. There is a direct use fee for all computer time. Control Data's Technology and Information Services collects no fees or commissions from resultant business transactions.
Dr. Dvorkovitz & Associates
P.O. Box 1748
Ormond Beach, Florida 32074
Dr. Dvorkovitz & Associates is an international licensing firm which specializes in providing information in the field of technology exchange. Services include: Instant TechEx, which provides access to a data bank of products and processes from all technical fields which are available for license, joint venture and/or acquisition. The listings come from worldwide sources in industry, government, universities and private inventors and may be stored in the data bank at no charge. The potential licensee (seeker of technology) pays all fees pertaining to retrieval of information. TechEx, a World Fair Technology Exchange, is an annual exhibition held at multiple sites whose purpose is the transfer of products, processes, know how, etc. among participants Participation is by attendance or by exhibiting in a booth, buyer office or inventor booth.
Minnesota Cooperation Office 965 Southgate Office Plaza 5001 W. 80th St. Bloomington, MN 55437 (612) 830 1230 The Minnesota Cooperation Office (MCO) is a tax exempt, non profit corporation. It is a private sector effort to create innovative, high growth companies. Directed primarily at the future economic strength of the State of Minnesota, MCO offers its knowledge, experience and contacts to help solve the problems of technology oriented, new businesses. MCO assistance to entrepreneurs extends from an initial evaluation to the final draft of a business plan. MCO also makes available to clients, its knowledge of business financing and its contacts with major institutional sources of venture capital. Supporting organizations include: Arthur Anderson & Co., Control Data Corp., Cargill Foundation, Honeywell, Inc., Minnesota Dept. of Economic Development, Price Waterhouse & Co., R.C. Lilly Foundation and The Toro Company.
Product Resources International, Inc. 800 3rd Ave. New York, NY 100Z2 (212) 980 8980
REFAC Technology Development Corporation 122 E. 42nd Street New York, NY 10017 (212) 687~741
Unirad Corporation 4765 Oakland Street Box 39002 Denver, CO 80239 (303) 371 7400 Emphasis is on scientific instrument development.
University Patents, Inc.
2777 Summer Street
Stanford, CT 08905
(203) 325 2285
SBA Management Assistance Programs The Small Business Administration's Management Assistance Division has several programs useful at this stage of the invention process:
SCORE, the Service Corps of Retired Executives, is a free counseling service in which retired, volunteer executives help small firms solve their technical and management problems.
ACE, the Active Corps of Executives, augments SCORE by providing more specialized expertise.
SBI, the Small Business Institute program, calls on the skills of university faculty and graduate students to provide management counseling for small businesses.
SBDCs, Small Business Development Centers, are university based organizations whose purpose is to develop the economy of the region around the university by providing a wide range of management assistance to small businesses and individuals in the area. Some SBDCs offer the services of specialists in the area of innovation management. See also page 5.
For a full description of SBA's Management Assistance pro gram, contact the SBA field office nearest you. A list of field offices is provided in Appendix 5.
S8A Management Assistance Publications To order up to five copies of each title, write: SBA, P.O. Box 15434, Fort Worth, TX 76119. Ask for them by title and number. They are free.
MA 2.006 Finding Q New Product for Your Company MA 1.008 Attacking Business Decision Problems with Breakeven Analysis MA 2.013 Can You Make Money With Your Idea or Invention? MA 2.016 Checklist for Going Into Business MA 4.019 Learning About Your Market
SBB 9
SBB 13
SBB 18
SBB 89
SBB 90
Marketing Research Procedures National Directories for Use in Marketing Basic Library Reference Sources Marketing for Small Business New Product Development
SBA also publishes a pamphlet describing its field structure, its various programs, plus it gives a guide to small business organizations, Congressional Delegations, selected committees, and so forth. It is called Small Business Guide to Government, published by the Office of Advocacy, and can be gotten through the field offices or from 1441 L Street, NW, Washington, DC 20416.
NASA Technical Assistance Programs and Publications National Aeronautics and Space Administration programs pro duce a wealth of aerospace technology. The Office of Space and Terrestrial Applications coordinates a nationwide network of specialists who provide a link between aerospace technology and high technology businesses. For a nominal fee these NASA specialists offer scientific, technical, research, and management services. These services are provided through regional Industrial Applications Centers and State Technology Applications Centers. See Appendix 10 for a listing of these Centers.
NASA also has several publications of interest to inventors, R&D managers, and high technology firms. Tech Briefs is a quarterly survey of newly developed processes, advances in basic and applied research and laboratory techniques, and new sources of technical data and computer programs. Their Technical Support Package provides more detailed information on the subjects surveyed in the Briefs. Tech Briefs are free. NASA also published various handbooks and data compilations, for example, the Scientific and Technical Aerospace Reports. For subscriptions to or information on NASA publications, write: Director, Technology Transfer Division, NASA Scientific and Technical Information Facility, P.O. Box 8757, Baltimore/Washington International Airport, MD 21240.
In addition to publications, NASA provides computer pro grams covering a wide range of aerospace applications. These programs are available at a fraction of their original cost through: Computer Software Management and Information Center (COSMIC), 112 Barrow Hill, University of Georgia, Athens, GA 30602, phone: (404) 542 3265. New programs are announced in Computer Program Abstracts, obtained through the Superintendent of Documents, GPO, Washington, DC 20402.
Non-government Publications on Innovation Management Gee, Edwin A. and Chaplin Tyler. Managing Innovation. New York John Wiley and Sons, 1976.
Karger, Delmar W. and Robert G. Murdick. New Product Venture Management. New York Gordon and Beach Science Publishers, Inc., 1972.
Marvin, Philip. Product Planning Simplified. American Management Associations, New York, 1972.
Midgley, David F. Innovation and New Product Marketing. London: Croom Helm Publishers, 1977.
Scheuing, Eberhard E. New Product Management. Hinsdale, IL The Dryden Press, 1974.
Production and Sales Phase
The final component of the Commercialization Stage is the ac tual production and sale of a new or improved product. The emphasis in this part of our Guide is on Federal procurement and procurement assistance programs. Private organizations like invention brokers and venture capital companies and non profit organizations like the MIT Enterprise Forum can offer advice on production and sales, as well as act as liaison bet ween the inventor and a potential manufacturer, (and they already have been discussed) but here we are concerned with how to sell to the U.S. Government.
Government Procurement Programs Before describing the various programs, here is a brief over view of the Federal procurement process. When the Government needs to purchase goods or services, it advertises for them. It can advertise through the Commerce Business Daily or trade papers, or it can invite bids from firms who are on a Bidders' List. A Bidders' List is a compilation, by an individual Agency, of the names, addresses, product orientations and related technical information of the companies who have the capability of supplying the goods or services the Agency needs.
How does a company get on a Bidders' List? First, find out what the procurement needs are of each Agency (every Agency has purchasing offices around the country and each Agency keeps its own Bidders' List) by asking for that information from the Agency's field office, a local SBA office, or the nearest GSA Business Service Center. Second, determine with which Agencies your company probably can do business. If you need more details than a field office can give about an Agency's exact procurement specifications and standards write to the Naval Publications and Forms Center, 5801 Tabor Avenue, Philadelphia, PA 19120. Ask by Agency name for its Procurement Specifications and Standards. Third, once you have determined to which Agencies (and what goods or services) you want to sell, call their field office and ask for the forms you need to get on their Bidders' List. Once you are on the list, you will automatically receive bid invitations.
In addition to getting on a Bidders' List, you should read the basic document advertising new purchasing requirements of Federal Government the Commerce Business Daily. It lists procurement invitations, contracts awarded, subcontracting leads, and foreign business opportunities. The subscription rate is $80 annually. Order from the Superintendent of Documents, GPO Washington, DC 20402.
Small and Disadvantaged Business Utilization (SADBU) Contacts
The various Federal Agencies are now establishing, at Agency headquarters, contact points for small businesses to call direct ly to obtain procurement and other financial assistance information. These are staffed with key personnel, knowledgeable about their own Agency's procurement needs. A listing of these SADBU contacts is given in Appendix 6.
Department of Energy Procurement Programs
The DOE's SADBU Office offers information on DOE's grant and procurement programs related to energy technology research and development. For further information about guidelines and programs, write: Director, Small and Disadvantaged Business Utilization Office, Mail Stop 1Io09, Forrestal Building, 1000 Independence Avenue, S.W., Washington, DC 20585, phone (202) 252 8201.
National Science Foundation Procurement Programs
NSF, Office of Small Business Research and Development publishes Small Business Guide to Federal R~D, previously mentioned. The Guide is intended to help small, high technology firms enter the market of Federally supported research and development. It is indispensible for firms not vet
into the Federal R&D field. All Federal Agency R&D grant and procurement programs are covered in detail. Also detailed are the steps needed to prepare a formal proposal for funding of R&D activities. While both grant and procurement programs are covered, the emphasis is on procurement.
Small Business Administration Procurement Programs
There are billions of dollars in Federal procurement contracts that annually bypass small businesses because their owners lack an understanding of how the Government buys goods and services.
The SBA has several programs that can help. They include:
1) Contracting Assistance SBA field offices (see Appendix 5) have Procurement Specialists who work closely with the purchasing personnel of the various Agencies and counsel small business owners on how to prepare bids, get their names on Bidders' Lists, etc.;
2) Small Business Set Asides These are contracts restricted for bidding by only small businesses;
3) Subcontracting Assistance SBA's field offices work closely with prime contractors to assure small business a fair share of subcontracting opportunities;
4) Certificates of Competency lf there are questions about whether a small business can fulfill the contracting requirements of a bid it has won, SBA will investigate and make a binding determination through the COC program;
5) Technology Assistance ln this program SBA encourages small businesses to participate in Federal R&D contracting by counseling them and listing them in the SBA's R&D directory; and
6) PASS This is the Procurement Automated Source System, a field office based, computerized system listing the capabilities of small companies so Federal procurement officers and prime contractors can select companies to receive bidding invitations. Turn to Appendix 7 for a listing of SBA field offices specifically designated to deal with PASS information re quests. To order a PASS Application Form call toll free 1 800 433 7212.
SBA has several publications with a procurement orientation. Ask your local SBA field office for copies (if free) and order the for sale ones from the Superintendent of Documents, GPO, Washington. DC 20402.
OPC 2
PA 1
PA 2
PA 3
PA 5
PA 6
Your Business and the SBA Selling to the U.S. Government (CPO) Contractor Paths to Grie~ Some Solutions SBA's Procurement and Technical Assistance Pro grams What is a Certificate of Competency? U.S. Government Purchasing and Sales Directory
(GPO)
SBA Subcontracting Directory (GPO)
State Economic Development and Sm~lll Business Programs Nearly all States have offices of economic or industrial development. Some States have extensive procurement, grant, and/or management assistance programs and will supply a packet of information about the services they provide to pro mote innovation, research and development, and small business opportunities. A few States are even developing science and technology offices specifically aimed at helping small, high technology firms. For an overview of state ser vices, see: Book of the States, Council of State governments, P.O. Box 11910, Iron Works Pike, Lexington, KY 40578.
SBA's Office of the Chief Counsel for Advocacy publishes a Directory of State Small Business Programs. Listed are the State small business assistance programs with names, addresses, phone numbers, and descriptions of the programs. See Appendix 8 for a Survey Chart of these programs. Your local SBA field office uses this book for a reference and can put you in contact with the State program personnel in your area.
Procurement, R&D and Technology Conferences Several conferences are held annually throughout the country to help inventors and small, high technology firms learn about the Government procurement contracting grant system, trends in technology, and how to evaluate and manage an invention. Contact to the following organizations for further information on their conference schedules. Some of these conferences are excellent sources of information and can provide personal contacts with other inventors and small business managers.
National Innovation Workshops
4035 Lincoln Blvd.
Marina Del Ray
Los Angeles, CA 90291
(213) 822 0350
Lakeshore Group Ltd.
207 East Buffalo Street
Milwaukee, WI 53202
(414) 272 5420
American Association of Small Research Companies 8794 West Chester Pike Upper Darby, PA 19082 (215) 449 2333 or 528 6093
Inventors' Exposition lnventors Workshop International Box 251 Tarzana, CA 94705
National Inventors' Week Exposition Patent and Trademark Office Washington, D. C. 20231
(703) 557 3158
California Inventors' Council
Box 2096
Sunnyvale, CA 94087
(408) 732 4314
New Products Technology Development Conference P. O. Box 12793 Research Triangle Park, NC 27709
(919) 549 8193
Publications of Interest
In addition to the publications already listed in the various sections of this pamphlet, there are some other journals and books of use to the inventor and innovative small business. They include:
Professional Journals
American Bulletin of International Technology Transfer
International Advancement, Inc.
Box 75537
Los Angeles, CA 90075
American Inventor
10310 Menhart Lane
Cupertino, CA 95014
In Business
The JG Press
Box 323
18 South Seventh Street
Emmaus, PA 18049
(215) 967 4135
Inc.
38 Commercial Wharf
Boston, MA 02110
(617) 227 4700
Industrial Research ~ Development Magazine
Technical Publishing
1301 South Groove Street
Barrington, IL 60010
(312) 381 1840
International New Products Newsletter
Transcommunications International, Inc.
Box 191
Back Bay Annex
Boston, MA 02117
New Product Monthly Reports
Berliner Research Center, Inc.
Berliner Research Bldg.
Danbury CN 06810
(203) 74~2333 Telex 969658
New Products and Processes
Newsweek International
P.O. Box 424
Livingston, NJ 07039
New Products Bulletin
Tiffany Products, Inc.
239 Main Street
West Orange, NJ 07052
(201)731 9111
New Products News
8576 Mesa Drive
Sandy, UT 84070
(801) 561 3259
Product Design and Development
Chilton Company
Chilton way
Radnor, PA 19089
Product Engineering
Morgan Grampian Publications
2 Park Avenue
New York, NY 10016
(212) 573 8133
Technical Information Periodicals Service,
Selected Business Ventures,
New Business Digest Annual
General Electric Company
Business Growth Services
120 Erie Blvd., Room 380
Schenectady, NY 12305
(518) 385 2577
The Review of Scientific Instruments
American Institute of Physics
335 45th Street
New York, NY 10017
(212) 661 9404
Technology Mart
Thomas Publishing Company
One Penn Plaza
250 West 34th Street
New York, NY 10001
Test Engineering ~ Management
The Mattingley Publishing Company
61 Monmouth Road
Oakhurst, NJ 07755
Venture Capital
Capital Publishing Company
Box 348
Wellesley Hill, MA 02181
(617) 235 5405
Venture Magazine
35 West 45th Street
New York, NY 10036
(212) 84~5580
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