Risk / Reward 
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RISK / REWARD

When you distill down a reviewer’s decision making process, you end up with a simple equation: funding = risk / reward. How do you strike this balance so that you receive funding? Let us first explore the components of risk.

Risk has a number of components. These include:
The inherent risk of the proposed set of studies
The inherent risk of the true market size
Controllable risk of experimental design
Controllable risk of experimental execution
Controllable risk of experimental interpretation

Reward has one major component: Inherent Significance: what impact will this product have in its field of use and how starved is the field for this product?

In this current blog, I will address the inherent risk of a proposed set of studies and the inherent risk of true market size.

Inherent risk can be controlled and minimized by providing preliminary data that reduces the risk. In fact, you can reduce the risk to near zero by providing enough preliminary data.

For a technique, keep the n low. In fact, for a technique, you only have to show one experiment to demonstrate that the experimental technique does work. Just be sure that the result is clean and convincing.

For a scientific concept, you will have to show significance. However, you only have to use a minimum number of observations and run the experiment one time. Most scientists run a full set of experiments at least three times in order to be sure that a set of observations is repeatable, so repeating the experiments in a Phase I study is fine. Be sure that you do not collect so much data that the reviewers conclude that Phase I has already been completed.

Sometimes the true market size (demand) is clear and lacks risk. A cure for inoperable cancer is an example of a clear demand.

Many proposed products do not have such a clear demand. In this case, it is important to have KOLs (key opinion leaders in the field of use) write a letter expressing the demand. It is also useful to have letters of support from established companies who might buy or sell your product.

Next week, I will address some aspects of experimental risks and how to control them.

For more specific and additional information on this topic, click on this link: High Level SBIR/STTR Grant Writing Techniques.

If you have any questions, please feel free to contact me or go to SBIR-STTRgrantshelp.com.



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