How Can You Get Funding For Your Invention?Here's where to look and what to expect.
As an inventor, you must know that the process of developing and commercializing an invention comes with a substantial amount of money. But, did you know inventors like you can get financial assistance and the needed resources to help launch your innovative ideas and get them into the marketplace?
Here's where and how you can land this kind of financial assistance:
The U.S. government is usually the go-to in getting funding resources for inventions. While the federal government does not directly provide invention funding, there is a slew of government-sponsored programs designed to support research and development of inventions.
This site provides a wealth of information regarding funding opportunities offered by the U.S. government. Here's what you need to know about grants.gov and how it can serve you and your inventions.
U.S. Department of Energy
The Energy Department offers financing programs, such as the Advance Research Projects Agency - Energy (ARPA-E), for the development of renewable energy technology inventions that save on energy consumption or benefit the environment. If you have an idea or have already invented a technology that saves on energy, you might be eligible for these energy grants.
Small Business Administration (SBA)SBA will help you market and manufacture your invention by supplying you with referrals to financial resources. In requesting for assistance, it is advisable to approach your invention idea as a business and pitch it by addressing which companies or organizations are willing to support it. Note that SBA grants funding to businesses, not individuals.
SBA has a wide array of loan and grant programs, all of which can assist you on how you can earn your way to small business success. An introduction to SBA can help you understand how this program works in delivering your invention-as-a-business needs. If you are already an existing business owner gearing to take off your invention but needs immediate assistance, you can benefit from SBA's SCORE (Service Corps of Retired Executives) program that provides low-cost training, mentorship and counselling sessions.
Small Business Innovation Research (SBIR)
The SBIR program assists eligible small businesses that are on the verge of technological innovation. You might find useful information on the SBIR website about research opportunities regarding your invention idea -- whether you are developing an app for civic engagement or building a device that have safety and health benefits.
National Institute of Standards and Technology (NIST)
NIST, now an agency of the U.S. Department of Commerce, supports small-scale, early-stage development technologies by providing funding for its Between Invention and Innovation program. With this project, NIST means "the technical and business activities that transform a commercially promising invention into a business plan that can attract enough investment to enter a market successfully and through that investment become a successful innovation."
If you consider your invention as commercially groundbreaking that can drive prospective investments, you might want to avail this funding opportunity.
National Collegiate Inventors and Innovators Alliance (NCIIA)
NCIIA awards E-Team grants that amount from $5,000 up to $75,000. Collegiate student inventors and faculty teams are eligible to apply for these grants (the "E" indicates entrepreneurship). You should have at least two people (students, mostly) engaged in your market-based technology project.
Nonprofits, social enterprises
There is a selection of charitable organizations, nonprofits or foundations (these are typically 501(c)(3) organizations as defined by the Internal Revenue Code), that are inclined to helping sponsor new inventions. Being a 501(c)(3 organization means being tax exempt.
Remember that these organizations do not necessarily provide funding for inventions, but you can make a request asking them if they can support your invention. Ensure that your invention is in line with their social mission so that they will be keen on supporting it.
If you have developed a socially-conscious invention that you think will help transform the lives of communities, locally or worldwide, it might fall into the social enterprise category. If your invention can deliver social impact as well as revenue, you can look for grants designed for social entrepreneurs.
Did you know you can also raise funds to kick start the creation of your invention? Indeed, getting your idea out in public and raising money for product development is easier now with crowdfunding platforms.
There is a wide range of crowdfunding sites (some of them are free!) that can get you supporters, donors, investors, pre-orders for your product, and even media coverage just for getting your invention under way.
Crowdfunding giant, Kickstarter, is a popular platform that enables inventors to bring their ideas or projects to life. IndieGogo and Quirky are also some of the biggest in the crowdfunding community. You can submit your ideas for funding, and once the community weighs in on whether they like your invention pitches, fundraising begins.
Are you directly looking for investors to fund your invention? Try seeking out an angel investor. Angel investors are people (could be a successful CEO colleague or a wealthy relative) that have the necessary business expertise and the cash to spare. These people are often found searching for invention or start-up business pitches to financially invest in.
Angel investors would want a reason to consider if your product will be a commercial success and return them profits. A comprehensive business plan is key to attracting these kinds of people. Write a direct-to-the-point business plan that spells out the kind of benefits your invention would bring to society.
Another invention investor you can turn to is a venture capitalist. Venture Capital (VC) funding is the most difficult to get. Oftentimes, it is also the most expensive with regards to what you need to give up in obtaining it. Like angel investors, venture capitalists would require you a business plan that details the whole shebang about your invention idea. Typically, venture capitalists expect your invention to be coughing up millions in sales on the onset. So, your idea should be huge in context for them to be interested in funding you.
A thorough process
In the end, expect that requesting for financial assistance to fund your invention is one thorough process. Take your time in searching for funding that could be relevant to your product.
Does your invention convey a social, environmental, economical value? Inventions, after all, are created and developed to improve the quality of living among individuals and communities. Once you have addressed these values, you can narrow down your search of government programs, organizations, crowdfunding platforms and investors that encourage and campaign for those values.
In line with this mission, the NIH has recently constituted the Small Business Innovation Research Phase IIB Bridge Awards to Accelerate the Development of Cancer Therapeutics, Imaging Technologies, Interventional Devices, Diagnostics, and Prognostics Toward Commercialization Program.
Community Development Financial Institutions are basically financial institutions who possess the ability to provide credit and financial services to underserved industries and communities.