For early stage startups, federal agencies key to funding success

Pittsburgh Post-Gazette

In the first week it rolled out its facial recognition tool, Marinus Analytics — a Carnegie Mellon University spinoff that has been creating software to mine the deep web for sex traffickers since 2014 — identified and rescued two victims.

Andreas Olligschlaeger, a research scientist at Marinus Analytics, said the Oakland company sits outside the tech mainstream because the company measures its success in how many children it can save. So far, there have been about 250 rescues in two years, he said.

That affinity for social good, but potential for commercialization, is exactly what the U.S. Small Business Innovation Research (SBIR) program is looking for when making an investment, Mr. Olligschlaeger said during a Tuesday event in Oakland about government-funding opportunities.

“We’re not the kind of company, necessarily, that a venture capitalist would look at,” he said. “Because we don’t generate value, we’re not a good investment.”

The National Science Foundation did act as a seed investor in 2016 when it awarded Marinus with $149,900 in Phase I SBIR funding. That first phase, which lasts six to nine months, is exploratory and used to determine both the technical merit and feasibility of an idea.

SBIR is a program of the Small Business Administration that encourages small, early stage businesses to engage in research and development at a time when other investors might find a venture too risky.

The approximate $2.5 billion in annual funding comes from 11 participating federal agencies, including the Defense Advanced Research Projects Agency, the Department of Defense and the Department of Energy, among others.

Those agencies come up with topics for research and development that each would like to explore and then encourage companies to send in proposals. In that way, SBIR is mutually beneficial