Myth of the Mills

Myth of the Mills. As some firms have been especially successful in winning Phase II awards, especially at the largest of the SBIR programs (DoD), critics have argued that these firms essentially provide a way for agencies to get contract research done, rather than funding the innovation research envisaged for the program by Congress.

The authors of the article, Robin Gaster and Charles Wessner, believe these criticisms are misplaced:

• Few firms quality as mills based on the number of awards they win, and together these firms account for a small share of all awards
• Multiple award winners commercialize more than firms with fewer awards, not less.
• Commercialization is not the only Congressional objective of the SBIR program, and the “mills” clearly serve other purposes well
• Some of the biggest “mills” – such as Foster-Miller – are no longer eligible to participate in the program
• The cure is worse than the disease. Limits on the number of awards or proposals could have significant negative effects on the program

Overall, this is nonproblem, and legislation to address it would be counterproductive and would reduce the effectiveness of an important program that supports R&D among small firms.

Full text article is available at the Innovation Ecologies web site