Business Regulation and Consumer Protection:
A Profile of Selected Firms Awarded Small Business Innovation Research Funds
RCED-86-113FS: Published: Mar 21, 1986. Publicly Released: Mar 21, 1986.
Pursuant to a congressional request, GAO collected information on the implementation of the Small Business Innovation Development Act of 1982.
The act is designed to strengthen the role of small innovative firms in federally funded research and development (R&D) programs and requires federal agencies with budgets of $100 million or more for R&D to be performed by outside concerns to set aside specified percentages of item budgets to fund the Small Business Innovation Research (SBIR) Program. Federal agencies made 760 awards to small firms participating in SBIR in 1983 and obligated about $44.5 million for SBIR awards. By 1988, the last year of the program, there will be about $500 million obligated for SBIR awards. The recipients were generally satisfied with the program, since it helped support their R&D projects. Most of the firms had contacted private companies regarding the commercial potential of their R&D projects, and some recipients had received private company pledges of capital investment in the final design, testing, and commercialization of their products and services. However, some venture capital firms may require a significant share of the business as compensation for undertaking the investment risk.