New Vistas in Transatlantic Science and Technology Cooperation by National Research Council

Author:National Research Council
Language: eng
Format: epub
Tags: Policy for Science and Technology
Publisher: NATIONAL ACADEMY PRESS
Published: 1999-05-25T00:00:00+00:00

Overall, Dr. Lerner concluded that the SBIR program has had a positive impact on high-technology start-ups that have won SBIR awards. There is room, however, for fine-tuning implementation of the program. With the SBIR program scheduled for congressional reauthorization in 1999, Dr. Lerner said that there would be an opportunity to consider improvements.

Comments from the Audience

A participant observed that Dr. Lerner had talked about the private return to participation in SBIR by firms but not the government’s return. Dr. Lerner was asked to comment on the government’s return from the SBIR program. In response, he acknowledged that his focus on the private return is a limitation of his analysis. There is, however, great difficulty in assessing social returns because it is hard to separate the portion of investment activity that would have occurred in SBIR awardees from the portion that the program induced. Even if a good bit of the investment activity would have taken place without SBIR, Dr. Lerner said that the R&D spillovers generated by SBIR firms would be an additional benefit.

Dieter Seitzer, director of the Fraunhofer Institute, in Erlangen-Nürnberg, asked for examples of how SBIR awards work in agencies. Dr. Lerner commented on the tremendous diversity among agency approaches to implementation and SBIR awardees. With respect to implementation, agencies such as DOD and the National Aeronautics and Space Administration use SBIR as a procurement tool for technologies with very specific purposes. Other agencies, while adhering to SBIR’s mandate to carry out agency missions, may fund technologies with longer time horizons before payoff. Regarding diversity, Dr. Lerner said that SBIR awards run a wide gamut of technologies, in contrast to venture capitalists, who tend to fund a narrower range of "hot" technologies, such as Internet technologies today.

A participant asked whether it was possible to compare the results of SBIR with those of venture capitalists. Although he had not done a systematic comparison, Dr. Lerner’s strong suspicion was that firms funded by venture capitalists perform better than those funded by SBIR. Venture capital-funded firms undergo strict scrutiny, and only a small fraction of companies seeking venture capital receive it. It is important to recognize that the goals of SBIR differ from those of venture capitalists, given SBIR’s focus on agency missions. In fact, Dr. Lerner added, there might be a great concern if SBIR focused only on biotechnology firms, as many venture capitalists do today, as opposed to the wide variety of firms that the SBIR funds.

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