leveraging the sbir program to build and grow a company

© 2009 Deep Web Technologies, Inc.

Leveraging the SBIR Program to Build and Grow a Company

By Abe LedermanPresident and Founder

August 25, 2010


About Deep Web Technologies...

•Founded by Abe Lederman, a co-founder of Verity, 2002

•Pioneered federated search technology

•$2.3M in revenue in 2009•Over $4M in SBIR Grants•Production applications since 1999•20 person, Santa Fe company with

strong executive team


What is Federated Search?

Internal Sources

Blogs & Wikis

SubscriptionSources

Public Web Sources

E-Books

News

Begin Search

One Search… …Many Sources


Customers Include...

• Boeing • Defense Technical

Information Center• DOE Office of

Scientific & Technical Information

• European Space Agency

• European Parliament• George Mason

University• Intel Corporate

Library

• Missouri Digital Heritage

• National Agricultural Library

• Raytheon• Science.gov Alliance• Scitopia.org• Stanford University• UCSF Medical School• WorldWideScience

Alliance

© 2009 Deep Web Technologies, Inc. 5

Our SBIR History

“Distributed Relevance Ranking in

Heterogeneous Document

Collections”

2003 2004 20072005 2006 2008 2009 2010

June: Awarded 1st

Phase I SBIR Grant

2005 – 2010 Awarded:12 Phase I Grants4 Phase II Grants

2005 – 2010 Awarded:12 Phase I Grants4 Phase II Grants

June: Awarded 1st

Phase II SBIR Grant

Develop new versions of Explorit, improve

scalability, add multilingual support and more

Secretary of Energy

launches Science.gov

2.0

Number of Employees

2 2 1/3 8 20


Partnerships are Key!

•Hired VP of Business Development in 2009

•Five partners

•Swets (Worldwide)

•iGroup (Southeast Asia)

•Techknowledge (Middle East)

•Systems Link (Latin America)

•Basch (United States)

Andy AlsopVice President of Business Development


Partnering with OSTI

“Your success rate becomes much higher if you are known to the person at the agency within the government that you are applying for…People fund the people that they trust, and they trust the people that they know. You have to take the time to go down to Washington before the solicitations come out – its illegal to do it after the solicitations are open – and get to know these people.”

Peter Lucas, founder of Maya DesignWinner of five SBIR Grants


Mission Statement

The mission of the Office of Scientific and Technical Information (OSTI) is to advance science and sustain technological creativity by making R&D findings available and useful to Department of Energy (DOE) researchers and the public.


OSTI Applications Running Explorit

•WorldWideScience.org•Science.gov•The E-print Network•Energy Technology Data Exchange•Environmental Science Network•Science Conferences•Science Accelerator•Energy Files•Federal R&D


Multilingual Federated Search


Translated

Original


New Commercialization Opportunities

• Multilingual Explorit developed on top of Microsoft Technology/Service

• Explore partnerships with machine translation companies

• Pursue markets where access to non-English content is valuable

• Pursue markets where translated content is useful to non-English speakers


Leveraging the SBIR Program

•Next-Generation Product

–Clustering–Alerts–Relevance Ranking–Multilingual Support–Web Services–Web 2.0 Interface

Launched 2005 on Science.gov


Next – Next Generation

•SaaS-based•Catalog of Sources•Themes•User admin/configuration•Highly Scalable

Launching Early 2011


Leveraging Multiple SBIRs in Support of Explorit R&D

• Phase I: Automating Scalability of Federated Search in a Cloud Computing Environment

• Phase II Year 1: An Analysis of the Performance Bottlenecks in the Federated Search Information Flow

• Phase II Year 2: Enabling Comprehensive One-Stop Access to World-wide Scientific and Technical Research


SBIR Commercialization Lessons

•SBIR funds are like VC funding, but you don’t give up equity

•Hard to manage to a budget when you don’t know if you’ll get the next Phase II

•Easy to become overly dependent on SBIRs


SBIR Commercialization Lessons (cont.)

•Difficult to fund marketing and sales efforts

•Still trying to find a strategic partner•SBIR revenue is discounted in

company valuation


Commercializing SBIRs:Phase III Support

•Science.gov Alliance–Infused $200,000 of development - 2005

• Intel corporate Library–Funded Web Services through advance

payment of license - 2006

•Scitopia–Funded further development – 2007

•OSTI –Funds development and maintenance of

applications through Phase III program


Sole Source Justification

• Under Phase III, it is intended that non-SBIR capital be used by the small business to pursue commercial applications of the R&D. That is, the SBIR/STTR funding pays for research or R&D meeting DOE objectives identified by the DOE (Phases I and II); non-SBIR capital provides follow-on developmental funding to meet commercial objectives (Phase III).

http://www.win-sbir.com/library/solesorc.html


Sole Source Justification (cont.)

• Under Phase III, Federal agencies may award non-SBIR/STTR funded follow-on grants or contracts

– Products or processes that meet the mission needs of those agencies, or

– Further research or R&D.

• The competition for SBIR/STTR Phase I and II awards satisfies any competition requirement of the Armed Services Procurement Act, the Federal Property and Administrative Services Act, and the Competition in Contracting Act.


Justification and Approval

• An agency that wishes to fund an SBIR/STTR Phase III project is not required to conduct another competition in order to satisfy those statutory provisions.

• In conducting actions relative to a Phase III SBIR/STTR award, it is sufficient to state that the project is a SBIR/STTR Phase III award that is derived from, extends, or logically concludes efforts performed under prior SBIR/STTR funding agreements.


Commercialization Resources

•Foresight Science and Technology–Market Research–Technology niche analysis–Funded by DOE–Deal advisory program

What every researcher needs to know about commercialization

By Phyl Speser

What every researcher needs to know about commercialization

By Phyl Speser


Commercialization Resources

•Matchmaking – Beyond Phase II


Thank you!

Questions?

Please email me:

Abe Lederman [email protected]

leveraging the sbir program to build and grow a company

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