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Press Release 98-042
National Science Foundation Is Taking Small Business Into a New Phase of Innovation

August 6, 1998

This material is available primarily for archival purposes. Telephone numbers or other contact information may be out of date; please see current contact information at media contacts.

The National Science Foundation (NSF) will award four grants in a new pilot program intended to bridge the gap between technology research and commercialization by providing incentives for Small Business Innovation Research (SBIR) grantees to seek partnerships with investors. The new SBIR Phase IIB Pilot Program supplements the already successful SBIR effort at NSF.

"SBIR has always been a catalyst for the growth of small high-tech businesses," said Kesh Narayanan, NSF director of industrial innovation. We found that the top 50 successful small business grantees (representing about 10 percent of all Phase II grantees) have accounted for $2.2 billion in direct sales and created 10,000 jobs. The pilot program will help give other small high-tech companies the opportunity to make this sort of impact."

NSF selected four small businesses to participate in the pilot program based on the intellectual merit and potential impact of their research: Polatomic Corporation, for a miniaturized device to measure the properties of planetary magnetic fields; Pericle Communications Company, for their work to develop a method to double the signal capacity of cellular radio networks; New Light Industries, for the design and application of a holographic printer; and Auxein Corporation, for the development of a metabolic primer to enhance plant growth.

SBIR is a congressionally mandated program initiated at the NSF in 1977 to promote the development of innovative technologies by small science and technology-based businesses. SBIR grants are awarded in two phases. Projects under Phase I are funded for a six-month feasibility study. If the projects are determined eligible, they may receive funding for the principal research effort under Phase II. After Phase II, grant recipients are expected to pursue commercial applications of their research without the support of government funding.

The Phase IIB Pilot Program allows small businesses to continue their research while securing the support of third-party investors. This financial support, in fact, is the main requirement for receiving Phase IIB grants. To be eligible, the third-party investor must commit a minimum of $100,000. NSF will then match up to 50 percent of funds received, but no more than $100,000.

Grant recipients can use the third-party money to tailor their technologies to the specific needs of the investors. However, they can only use the NSF funds to continue research related to the ongoing Phase II work.

"Not all projects in Phase II necessarily need Phase IIB funding," said Narayanan. "We see the new pilot program as a way to encourage SBIR grantees to bring their high-tech products to the marketplace by forming partnerships with investors."

-NSF-

SBIR Phase IIB Projects

A Three-dimensional Holographic Hardcopy Printer
New Light Industries, Ltd., Spokane, Washington

A holographic printer, the Holocomposer, is a significant advancement in the creation of three-dimensional holograms for security purposes. The biggest advantage to a holographic portrait on an ID card is that it is unique to the individual, like a photograph or a fingerprint. New Light Industries is building into the Holocomposer the ability to include covert security features that will make any counterfeits easy to detect. The materials used to print a hologram with Holocomposer remain unique, since the technology to create both the printers and the printing materials is proprietary. This makes it nearly impossible for counterfeiters to match. {Contact: Steve McGrew, (509) 456-8321/stevem@iea.com}

A Metabolic Primer To Increase Plant Growth and Productivity
Auxein Corporation Lansing, Michigan

The Auxein Corporation will use the Phase IIB grant to commercialize its AuxiGroTM Wp Plant Metabolic Primer. AuxigroTM enhances plant growth and productivity by improving how well a plant uses nutrients. The active ingredients of AuxigroTM occur naturally in all plants and therefore do not pose a threat to the environment as do some fertilizers, pesticides and plant growth regulators.

Auxein has already demonstrated the effectiveness of AuxigroTM in the laboratory, greenhouse and field. Currently, AuxigroTM is labeled for use only on a limited variety of crops, so Auxein will conduct further field trials to demonstrate the product's ability to enhance production of other crops such as grapes, citrus and nuts. Researchers also seek to establish the value of applying their product to row crops, such as corn, and for bedding and garden plants. {Contact: Alan Kinnersley, (517) 336-4675/kinnersleya@auxein.com}

A Vector/Scalar Magnetometer To Study Planets From Orbit
Polatomic, Inc. Richardson, Texas

With Phase IIB funding, Polatomic will produce a prototype laser magnetometer designed to measure planetary magnetic fields from an orbiting spacecraft. The self-calibrating laser magnetometer will provide researchers with unique information on the structure and dynamics of planetary interiors and fluid flow within and on the surface of the earth and other planets.

A miniaturized helium cell allows Polatomic to create an inexpensive device with many practical applications. Polatomic's founder, Robert Slocum, is convinced that it will play an essential role in collecting data from orbit in future studies of long term climate change on Earth as well as on solar magnetic storms and for new advances in the earth sciences.

The helium cell of the laser magnetometer has a resonance frequency proportional to the size of the magnetic field that surrounds a planet. The instrument tracks this frequency, measures the magnetic field to one part in 250,000,000 and calculates the directional components of the magnetic field. {Contact: Bob Slocum, (972) 690-0099/Bob_Slocum@polatomic.com}

An Adaptive Rate Wireless Phone For Cellular Radio Networks
Pericle Communications Co. Colorado Springs, Colorado

The goal of this project is to double the capacity of the current digital cellular radio network by compressing the human speech to the lowest data rate possible without degrading the voice quality. Currently, Time Division Multiple Access (TDMA) is one of four main airlink standards used in the U.S. Pericle has divined a method to double TDMA capacity by increasing the average modem bit rate in a single time slot from 4kbps to 9.6kpbs.

To keep up with this high rate of transmission, Pericle has developed a variable rate vocoder, or voice encoder/decoder. The vocoder, which converts the human voice to an electronic signal and then back again, operates at a rate of about 9.6kpbs while the modem varies the speed of the information fed through the channel. By varying the speeds of the modem and vocoder, this technology increases voice quality while lowering costs and doubling the network capacity of digital cellular telephones. {Contact: Jay Jacobsmeyer, (719) 548-1040/Jacobsmeyer@compuserve.com}

Media Contacts
Gregory Lester, NSF, (703) 292-8070, glester@nsf.gov

Program Contacts
Kesh S. Narayanan, NSF, (703) 292-7076, knarayan@nsf.gov

The National Science Foundation (NSF) is an independent federal agency that supports fundamental research and education across all fields of science and engineering. In fiscal year (FY) 2014, its budget is $7.2 billion. NSF funds reach all 50 states through grants to nearly 2,000 colleges, universities and other institutions. Each year, NSF receives about 50,000 competitive requests for funding, and makes about 11,500 new funding awards. NSF also awards about $593 million in professional and service contracts yearly.

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