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Don’t Kill the Golden Goose!

Don’t Kill the Golden Goose!

By Jenny C. Servo, Ph.D.

In July 2022 Congress passed the sweeping Domestic Semiconductor Manufacturing Act[1] to ensure U.S. competitiveness and dominance in this critical technology. This need harkens back to the 1970’s when the same concern regarding U.S. competitiveness gave rise to the Small Business Innovation Research (SBIR) program. However, the response today is different – in 2022, Congress is heading towards the potential lapse of the SBIR/STTR programs due to its inaction!

What is so unnerving is that Congress apparently doesn’t know the role that the SBIR/STTR programs have already played in strengthening the domestic semiconductor industry – through a small, SBIR-funded company called Arkansas Power Electronics International (APEI) which was acquired by Cree (NASDAQ: Cree) in 2015 and today is known as Wolfspeed.  The future of the semiconductor industry lies with wide band gap materials – SiC and GaN and Wolfspeed is the world leader.

SiC Wafer Market Share

2% 4% 5% 13% 14% 62%
  • Wolfspeed has long-term stable market share of >60%
  • Wolfspeed is recognized as a technology leader in the industry
  • Wolfspeed is leading supplier to world's largest power semiconductor IDMs
  • Wolfspeed continues to add materials capacity to maintain market leadership
  • Wolfspeed
  • II-VI
  • SiCrystal
  • SK Siltron
  • TankeBlue
  • Others

Source: Wolfspeed, pg 80.

At the time APEI was acquired in 2015, the Executive Vice President of Cree stated,

“Adding this expert team of innovators and portfolio of patents will enable us to further disrupt and expand the market,” said Frank Plastina, executive vice president, Cree Power and RF. “Extending our research and development capabilities with APEI, a leader in wide bandgap power R&D, will help us accelerate delivery of a full spectrum of SiC power modules to meet customer requirements for performance and cost.”[2]

Two days ago Wolfspeed announced a ”$5 Billion investment in Chatham County, largest in NC History”[3] to build a new semiconductor plant.

To put the role of the SBIR program in perspective here are a few data points. Arkansas Power Electronics International was founded in 1997 and between 2002 and 2015 received 59 Phase I and Phase II awards which included: 29 awards from the Department of Defense; 13 awards from the Department of Energy, 14 awards from the National Aeronautics and Space Administration, one award from the Department of Transportation and one award from the National Science Foundation. This level of support for revolutionary technologies by the SBIR/STTR programs is necessary. To simply assume that providing multiple awards to a small business is a waste of tax-payer money or that this practice prevents other companies from winning SBIR/STTR awards is simply false.  

This is one of the many SBIR/STTR successes that goes unheralded as federal agencies lack sufficient funding and tools to track the success of SBIR/STTR awardees over an extended timeframe.  Since 1982, many successful technologies funded though the SBIR/STTR programs have enhanced U.S. competitiveness, created jobs, and commercialized new products. Congress needs to take appropriate measures immediately to keep the SBIR/STTR programs in place. To let this program lapse will hinder U.S. competitiveness – which is the reason the SBIR program was initially created [4] and should be allowed to flourish!

[1] H.R. 6359 – Investing in Domestic Semiconductor Manufacturing Act

[2] Wolfspeed. “Cree Acquires APEI (Arkansas Power Electronics International, Inc.”  July 09, 2015.

[3] WRAL News. Wolfspeed announces $5 billion investment in Chatham County, largest in NC history”, September 9, 2022.

[4]  Public Law 97-219 – July 22, 1982.

Jenny C. Servo, Ph.D. is the President and Founder of Dawnbreaker, a woman-owned small business located in Rochester, NY which has provided commercialization assistance to SBIR/STTR awardees since 1990.

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Why SBIR/STTR should be reauthorized NOW

Why SBIR/STTR should be reauthorized NOW

By Jenny C. Servo, Ph.D.

Small, advanced technology firms have suffered enough! What they don’t need now is a death blow from the federal government. During COVID these firms weathered delays in their research due to supply chain issues and illness in their staff. Today, many contend with the loss of employees to large enterprises that view firms funded by the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs as ripe for harvesting qualified, experienced staff. Now is NOT the time to orchestrate the demise of these programs and put at risk the survival of the companies nurtured by participating agencies. Delays in reauthorization of the SBIR/STTR programs and the uncertainty regarding funding will severely damage this vital sector of the U.S. economy.

Let me address some misinformation that is being bantered around.

Some maintain that potential, new entrants to the SBIR/STTR programs fail to secure awards because these are gobbled up first by frequent award winners. Indeed, the threshold for winning an SBIR/STTR award is intentionally high. After all, funding for these programs comes from each participating agency’s extramural R&D budget. Solicitation topics vary widely and are directed at each agency’s mission. Awards are made with taxpayer money and those responsible for making award decisions critically evaluate each proposals’ goodness of fit with the solicitation topic, as well as the ability of the proposed team to conduct the research. Because the threshold is high, new entrants to these programs often need support in preparing their first SBIR/STTR applications. Agencies such as the Department of Energy and the National Institutes of Health have therefore instituted a Phase 0 program to assist new applicants in proposal preparation. The results indicate that such programs have a positive impact on assisting new applicants to win SBIR/STTR awards.

Then there’s the “elephant in the room.” Is money being wasted by giving multiple SBIR/STTR awards to frequent award winners? All different types of companies apply for SBIR/STTR awards. There are start-ups with one or two employees. There are small businesses that have between 10-15 employees who have just heard about these programs for the first time. There are companies that have been around since the 1980’s which have applied to the SBIR/STTR program since that time and have less than 500 employees (threshold for small business). All of these companies win SBIR/STTR awards. However, the infrastructure of each of these firms differs greatly. A start-up with one or two employees is not going to have a laboratory, or the facilities to engage in low-rate production.  True start-ups don’t have differentiated departments and lack considerable business expertise. There are a myriad government programs, many funded through the Small Business Administration designed to assist such companies to develop their infrastructure. The SBIR/STTR programs are for R&D and although it will pay some of a company’s overhead, the small business has to find its own way to secure funding for business growth from other sources. In response some companies seek equity investment, while others pursue other government contracting vehicles and do whatever they can to grow their business engine.

Some of the agencies that participate in the SBIR/STTR programs are actual customers for the technologies that the SBIR/STTR awardees develop. They need the small businesses to be capable of delivering what they are contracted to develop. This leads contracting agencies such as the Department of Defense to focus on the ability of the company to deliver the technology/ solution/product that it is funding in an expeditious manner. By comparison, granting agencies such as the National Science Foundation, the National Institutes of Health and the United States Department of Agriculture are NOT customers for the R&D that they fund. The mission and the criticality of what is being produced are different in contracting and granting agencies. The SBIR/STTR programs are dynamic and appropriately vary in implementation at the agency level.

Commercialization success comes in all shapes and sizes – some are small successes, while others are large and have tremendous impact. It is short-sighted of those who sit in judgment of the SBIR/STTR programs to expect and mention only large commercialization successes. This is after all “seed funding” – the earliest stage of funding, often avoided by venture capital, and a niche which the SBIR/STTR programs have uniquely filled. All commercialization successes should be tracked, celebrated, and publicized. However, there is often insufficient funding for the SBIR/STTR program offices to employ the staff to make this a priority. The successes that truly exist, large and small are under-counted and need to be tracked over an extended period.

Procurement by the federal government of SBIR/STTR funded technologies through the Phase III award mechanism remains a gap. The FY20 NDAA Sec 880 added language to the Small Business Act (15 USC 638) which indicates that Senior Procurement Executives, Procurement Center Representatives (PCR) and Directors of the Office of Small and Disadvantaged Business Utilization (OSDBU) should, “consult with appropriate personnel from the relevant Federal agency to assist SBCs participating in a SBIR or STTR program particularly in Phase III…” However, how to do that remains unclear.

It is important to the U.S. economy that support continues, without interruption for advanced technology firms providing needed R&D solutions through the Small Business Innovation Research and Small Business Technology Transfer programs. It has taken decades to grow and mature these programs. As we emerge from the struggles which everyone had endured with COVID, this fragile and valuable program could be destroyed with a single blow. Re-authorize the SBIR/STTR programs by whatever means possible. Small business innovation depends on it!

Jenny C. Servo, Ph.D. is the President and Founder of Dawnbreaker, a woman-owned small business located in Rochester, NY which has provided commercialization assistance to SBIR/STTR awardees since 1990.

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Dawnbreaker Unveils its 2020 Updates to the Defense, Energy, Medical and Space Portals

ROCHESTER, NY (November 25, 2020) – How does a great market research team give thanks?… by freely sharing information. Recognized for the hundreds of reports it prepares annually, this proficient and highly skilled team has just completed its 2020 update of Dawnbreaker’s Defense, Energy, Medical and Space portals. Each portal is chocked full of information selected for high tech small businesses seeking information related to Federal initiatives within these sectors.

Dawnbreaker’s popular Defense Portal is newly updated and designed to provide information for those seeking Phase III funding from the Department of the Navy. A limited domain of topics which frequently arise when discussing Phase III has been selected. Here you will find up-to-date information for individuals and organizations including the Chief of Naval Operations (CNO), OPNAV Resource Sponsors, ASN(RDA), United States Marine Corps, as well as Resources and Reports.

The Energy Portal focuses on alternative energy. Up-to-date information is readily available regarding technology gaps, roadmaps, legislation, current projects, advantages and disadvantages for the alternative energy sources which will define our future. Lists of Trade Shows and Conferences extending into 2021 is also available, as well as Climate Change and Foreign Energy Reports.

The Medical Portal is built around the Food and Drug Administration’s regulatory processes. Highlighted are descriptions of relevant FDA centers, as well as information on vaccines, blood and biologics, biotechnology, medical devices and veterinary products.

The fourth in this series, the Space Portal highlights NASA’s activities, beginning with an overview of the FY 2021 Budget Request and the NASA organization. Additional sections are dedicated to technology development, commercial space, partnership development, current opportunities and featured missions.

Take a moment to explore the Dawnbreaker portals and refer back to them in the future when you need key information regarding federal initiatives in these sectors.

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Dawnbreaker Expands its Team to Meet Growing Demand

Rochester, NY, November 2020 – Dawnbreaker, Inc. has added three new members to its team. Chris McCray, Karen Mesolella, and Jill Porter joined Dawnbreaker to provide its clients with more top-notch talent to meet the demands of working with over 600 advanced technology companies each year.

Chris McCray, MBA brings years of experience in several industries as a U.S. Navy veteran in cryptology, an experienced healthcare clinic manager, an IT entrepreneur, and a small business consultant. Prior to joining Dawnbreaker, McCray leveraged this experience as a Business Consultant at the Florida Small Business Development Center (SBDC) at the University of Southern Florida (USF) where he provided one-on-one confidential counseling to current and potential small business owners. In his role as a Business Strategist at Dawnbreaker, McCray will work with a variety of clients to fulfill their diverse commercialization needs.

Karen Mesolella, MBA, MS has a background in Healthcare IT and chemistry applied to both materials science and healthcare coupled with extensive experience in marketing, sales, IT, supply chain and manufacturing. Most recently, Mesolella was the U.S. Commercial Operations Manager for a leading global provider of products and systems that contribute to quality enhancement and cost efficiency within healthcare and life sciences – her commercialization expertise comes from working across four fortune 500 companies leveraging DMAIC Six Sigma principles. As a Business Strategist at Dawnbreaker, Mesolella will assist small, advanced technology firms by leveraging her strong background in healthcare informatics, software, lifecycle management, and manufacturing as they transition their technologies to the market.

Jill Porter brings years of management experience to Dawnbreaker in her new role as the Contract Administrator for Dawnbreaker’s Technical and Business Assistance (TABA) services – a component of the business that is growing quickly. TABA provides SBIR/STTR awardees the option of selecting a vendor of its own choice to assist in the commercialization of agency- funded technology. Through her extensive experience in contract administration, Porter interacts directly with small businesses and the Dawnbreaker team to facilitate the processing of TABA requests, as well as the record keeping associated with this initiative.

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Dawnbreaker Expands its Team with New Business Strategist

Rochester, NY (August 22, 2019) – Dawnbreaker, Inc. is proud to welcome Dan Keeley who joins the team as a Business Acceleration Manager bringing with him an extensive background in biomedical engineering, innovation and technology commercialization. Most recently, Dan worked for the University of Rochester at UR Ventures and Nextcorps (formerly High Tech Rochester). In both roles Dan helped professors, medical professionals and entrepreneurs develop strategic plans to commercialize their technologies.

Mr. Keeley spent six years at Johnson & Johnson working in new product development and technical project management and has worked on a number of portfolio development projects performing business case analysis and developing a pipeline of products from a single platform technology. Working at Becton Dickinson and Co. Dan helped develop the strategic plan to launch a new segment of their Biosciences division.

“Having worked at a university and in the startup community, I believe strongly in the SBIR and STTR programs’ ability to accelerate innovation. Joining Dawnbreaker, I’m proud to be working for a company that helps make these programs successful,” said Mr. Keeley. “I enjoy the business problem solving that goes into transitioning technologies from the lab to the marketplace and am excited to be able to leverage my expertise in product development, engineering and technology commercialization to help startups and small companies create value from their scientific innovations.”

Throughout his career, Mr. Keeley has worked with a range of biotechnology products including implantable biomaterials, stem cell technologies, high molecular weight growth factors, combination devices and more. He has been awarded 3 patents with 8 patents pending, a publication in the Journal of Neuroscience Methods and was a 2008 Michael J. Fox Foundation Award recipient. Dan has an BS and MEng in Biomedical Engineering from Cornell University’s School of Engineering in addition to an MBA from Cornell’s Johnson School of Management.

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Dawnbreaker Adds New Creative Talent

Rochester, NY (August 21, 2019) – Dawnbreaker, Inc. is pleased to welcome a new graphic designer, Holly Reader, to its team. Ms. Reader joins Dawnbreaker with 15 years of experience in Visual Communications as a Graphic Designer, most recently for MacKenzie-Childs, LLC.

With a proven ability to translate marketing ideas and design concepts across all organizational levels in print, web and mobile design solutions, Ms. Reader will provide clients with a variety of marketing materials, and is experienced in working on cross-functional teams, or solo to produce effective solutions.

“I am excited about my role with Dawnbreaker. I look forward to planning and creating marketing design solutions to benefit the customer and help promote the Dawnbreaker brand,” Reader says. “I admire Dr. Jenny Servo, the President and CEO, because of her knowledge, drive for success, business ethics, and her leadership role as a woman. I am lucky to serve on her team of multi-talented professionals with varied areas of skills and expertise and look forward to contributing to the clients’ and company’s success.”

Ms. Reader’s experience, which includes: brand strategy, typography, logo design, print advertising, web advertising, business collateral, strategic communication, photo retouching, photo editing, web banners, newspaper ads, page layout, direct mail, technical illustration, email marketing, social media campaigns, trade show and career fair graphics, promotions and fundraising, web design, and more will provide Dawnbreaker and its clients with creative and effective marketing materials. Ms. Reader holds a BA in Mass Communication from King’s College and a MFA in Graphic Design from Rochester Institute of Technology.

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Dawnbreaker Unveils All-New Industry Portals Online

ROCHESTER, NY (June 7, 2019) – Following its recent website release, Dawnbreaker has just unveiled three refreshed industry portals, aimed at assisting aspiring small businesses within the SBIR/STTR programs. The Defense, Medical and Space portals are each available at https://www.dawnbreaker.com/portals/ and provide a wealth of resources for high tech small businesses seeking answers to commonly asked questions within these sectors.

While the Defense portal is specifically geared toward Department of Navy SBIR-funded companies seeking Phase III transition, the Medical portal is provided as a service to those developing and improving drugs, biologics and medical devices. Meanwhile, the Space portal provides information on changes in the National Aeronautics and Space Administration (NASA) organization, the NASA budget, funding, commercial space, featured missions and past programs.

“We have leveraged the talents of our market research and business acceleration teams here at Dawnbreaker to create this expansive library of frequently asked questions, regulatory requirements, information on funding opportunities and much more,” says Dr. Jenny C. Servo, President and Founder of Dawnbreaker, Inc. “We will soon be launching our Energy portal as well, so companies seeking to partner with the Department of Energy can also utilize the resources.”

As always, the industry portals are free to use for interested parties. To view the portals, please visit https://www.dawnbreaker.com/portals/.

About Dawnbreaker Market Research
For over 25 years, Dawnbreaker has provided market research to advanced technology firms funded by the Small Business Innovation Research (SBIR) programs of the Department of Defense, Department of Energy, the National Institutes of Health, the National Aeronautics and Space Administration and the Department of Transportation. Visit https://mrr.dawnbreaker.com to learn how this same expertise can be applied to your small business.

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Dawnbreaker Teams with Chloe Capital; Double Downs on Women-owned Small Businesses

ROCHESTER, NY (April 23, 2019) – Chloe Capital has been on a national mission to discover the best and brightest female entrepreneurs and their innovations. The seed-stage venture capital firm has been holding women-only pitch events in five cities across the United States as part of their Chloe Capital National Tour. Companies are selected based on their online submission and are then chosen to pitch their ventures live. The winner receives an investment from Chloe Capital and the opportunity to pitch to their funding partner, Astia Angels, for a follow-on investment.

Ms. Theresa Pipher of Dawnbreaker has been active on Chloe Capital’s Due Diligence Committee throughout the tour and has provided Competitive Intelligence (CI) and material review assistance for the applicants.

“Dawnbreaker is dedicated to assisting women and minority-owned firms prepare SBIR/STTR applications for federally funded advanced S&T awards,” says Dawnbreaker Founder & President Dr. Jenny C. Servo. “Assisting Chloe Capital in a nationwide search for the very best in female entrepreneurship was a very natural fit.”

The previous leg of the tour, held in Chicago, resulted in a $100,000 investment from Chloe Capital to Journey Foods. Riana Lynn, Founder and CEO of the start-up, is using AI-based foodtech to help solve the world’s $600B nutrition dilemma. The National Tour wraps up in May, with a stop in Binghamton, NY on May 1. More dates and cities are expected to be announced this year.

About Chloe Capital
Despite recent progress, less than 5% of all venture capital in the U.S. goes to women-led tech companies. Yet studies show that companies with women at the helm grow faster and produce greater returns for investors. Chloe Capital is a seed-stage venture capital firm that invests in women. We’re catalyzing solutions to the gender and diversity gap in entrepreneurship by offering investors the opportunity to Do Well by Doing Good. We recruit women-led technology and tech-enabled companies and use our national network to drive business after our investments.

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Dawnbreaker Launches New Spanish Podcast Series; Increases SBIR Outreach To Hispanic Population

ROCHESTER, NY (March 20, 2019) – Dawnbreaker, Inc. has launched a Spanish speaking podcast series to help small, Hispanic-owned advanced technology firms take advantage of available federal funding through the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. In response to a survey conducted in 2011 that found SBIR participation from Hispanic-owned firms was dwindling, Dawnbreaker wanted to provide a resource that re-engages the Latino population.

“The SBIR and STTR programs are all about inclusiveness, and that’s what we’re hoping to achieve,” explains Dr. Jenny C. Servo, President of Dawnbreaker. “As many of these small business owners speak and read in Spanish, this podcast aims to help them navigate the complexities of acquiring federal funding for their innovations.”

The first two podcasts, which can be found at https://www2.dawnbreaker.com/podcast/, provides an introduction to the SBIR/STTR programs and reviews eligibility requirements. Dawnbreaker will release a new podcast every month, and the series will take the listener through the various stages of applying for SBIR/STTR funding.

Dawnbreaker continues to work with hundreds of small businesses through the SBIR and STTR programs. Many members of the Dawnbreaker team have lived and worked in Spanish speaking countries.

About Dawnbreaker:
Dawnbreaker a leading provider of commercialization services that support the Small Business Innovation (SBIR) and Small Business Technology Transfer (STTR) communities. Since 1990, Dawnbreaker has provided commercialization assistance to over 8,500 Phase I and Phase II SBIR/STTR awardees. Cumulatively these firms have received more than $2.5B in Phase III funding.

Contact:
John K. Servo
585.617.9420
jkservo@dawnbreaker.com

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Dawnbreaker Wins Sole Source Contract From National Science Foundation (NSF), Continues To Assist SBIR Firms

ROCHESTER, NY (February 21, 2019) – Dawnbreaker, Inc. has been awarded a sole source contract from the National Science Foundation (NSF) to continue delivering commercialization services to its Small Business Innovation Research (SBIR)/Small Business Technology Transfer (STTR) Phase I grantees. Since 2001, Dawnbreaker has administered its Commercialization Planning Program (CP2) to NSF funded SBIR/STTR Phase I grantees supporting over 2,500 projects to date. Recognizing that only a portion of the Phase I grantees will be awarded a Phase II grant, NSF introduced the program to increase the probability of successful commercialization of the NSF funded technology irrespective of whether a Phase II award is made and to provide a more level playing field to all entrepreneurs submitting Phase II proposals.

“Until now we have been jointly providing commercialization services with other vendors; with this new contract Dawnbreaker will be solely administering the CP2 to all SBIR/STTR Phase I grantees funded by NSF, and we are excited to embark on this new journey,” says Dr. Carol Rabke, Program Manager at Dawnbreaker.

The intensive, 6-month CP2 includes a mix of activities aimed at helping Phase I grantees develop the 15 page business case for the NSF funded technology that must accompany their Phase II submission to NSF. In addition to feedback on their commercialization plan, grantees are provided market research support, webinars on key business issues and access to resources through a secure eLearning portal. In administering the program, Dawnbreaker draws upon its talented team of Business Acceleration Managers and Market Researchers, who cumulatively have decades of experience in helping small businesses define their path to commercialization.

In addition to the new NSF agreement, Dawnbreaker has recently secured contracts with the National Oceanic and Atmospheric Administration (NOAA) and the Department of Labor (DOL). The company continues to work with hundreds of small businesses through SBIR and STTR programs providing services every step along the way from Phase 0 through Phase III.