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How does SBIR work?

Last checked on:
7 October 2020
Published on:
3 May 2024

SBIR (Small Business Innovation Research) is a phased innovation competition during which the companies with the best tenders go on to the next phase. SBIR is the system that the government uses to procure research services to create a market that they can later access for procurement.

A contracting authority identifies a specific challenge and makes a budget available. The entrepreneurs that submit the most promising feasibility studies (phase 1) are then commissioned to carry out further research and develop their product (phase 2). After that, the entrepreneur can launch the innovation on the market (phase 3); as the first customer (‘launching customer’), the government can then procure the innovation.

Phases

Phase 1: Feasibility study of the innovation

The entrepreneurs with the best tenders will be commissioned to test the feasibility of their ideas (on paper): that is from an organisational, legal, technical, financial and commercial point of view. These entrepreneurs are required to carry out the feasibility study for their innovation within the agreed deadline and for the agreed tender amount. Entrepreneurs may collaborate with a knowledge institution or with other companies, or outsource parts of the work when implementing the contract. After getting the committee’s recommendations (see heading ‘Assessment’), the client decides which projects will be commissioned for phase 2: developing the innovation.

Phase 2: Developing the innovation

All the feasible ideas submitted during phase 1 may be resubmitted in phase 2. The assessment criteria are the same as the ones used during phase 1, but in addition the financial prospects weigh more heavily during phase 2. The entrepreneurs who go through to the next phase start a research and development project and deliver the end result for the agreed price and within the deadline. The end result consists of a tested prototype, a demonstration, the first production series of the prototype or pilot project of the product, process or service. The Netherlands Enterprise Agency and the contracting authority work with the entrepreneur during phase 2 with the aim of achieving the best possible end result.

If applicable, phase 2 may be split into two phases, phase 2a (developing the prototype) and phase 2b (testing the prototype in practice). Sometimes phase 1, the feasibility study, is skipped. This is clearly stated in the call.

Those who submitted the selected tenders will be commissioned to carry out the proposed research during phase 1 and 2. The incentive for this is the tender amount. This has to be less than the maximum amount stated in the call and it has to be in line with market rates.

Phase 3: Marketing the innovation

Once phase 2 has been successfully completed, the entrepreneur proceeds with preparing the innovation for the market, assisted financially by an external financier if necessary. The financier should preferably be involved early on in phase 2. This can be very important for a successful introduction to the market.
The government does not fund this phase. The Netherlands Enterprise Agency does, however, put the spotlight on the innovations and follows their progress.

Assessment

Each SBIR competition has its own impartial assessment committee, which assesses the tenders on the basis of the following criteria:

  • impact
  • technical feasibility
  • economic prospects
  • tender price (if applicable)

The evaluation committee ranks all the projects and advises the Netherlands Enterprise Agency and the contracting authority.

Intellectual property rights

The entrepreneur keeps all intellectual property rights. This may not always be the case, depending on the circumstances. Read more about intellectual property.

Submitting a tender

All the documents for the various phases of the SBIR competition are available on Mijn RVO (in Dutch).

Commissioned by:
  • Ministry of Economic Affairs
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