If you're located outside of a startup hub, taking the week or two to apply for a $100,000 Phase I SBIR grant - if there is one relevant to what you are doing,

If you're located outside of a startup hub, taking the week or two to apply for a $100,000 Phase I SBIR grant - if there is one relevant to what you are doing, is a smart move. If you know your subject matter, it is not that much work, and the red tape can be well worth a six month budget. Other than the red tape, which is not THAT bad operationally, the money is literally free. There are often good opportunities from DoD, in some solicitations. There's a new solicitation out from someone every few months. http://www.dodsbir.net/ http://www.dodsbir.net/ A Phase I can lead to a Phase II - which can be $1 million or more. For instance, there were some very interesting topics in DoD's solicitation a few back: http://www.acq.osd.mil/osbp/sbir/solicitations/sbir092/osd092.htm http://www.acq.osd.mil/osbp/sbir/solicitations/sbir092/osd09... BTW - DoD is pretty cool about not requiring an advanced degree, unlike some other departments. If you have a background full of successful projects but no degree, you can still win by stuffing some MS/PhD's in as advisers. That being said - for some of these it can take six months to hear whether you even won the grant, so this is not a primary funding strategy. It is a supplementary funding strategy. Its something to do, then forget about until you hear back. You don't want to try and setup a company with the government as your only customer - they will bleed you dry with delays. But if you're going to build something anyway, and are an expert in the area... why not go for the cash? Your state may have an office setup to assist you in applying for these. The folks at ATDC in Atlanta were very helpful: http://innovate.gatech.edu/Default.aspx?alias=innovate.gatech.edu/sbir http://innovate.gatech.edu/Default.aspx?alias=innovate.gatec... There are numerous companies in Atlanta that have 'bootstrapped' to the tune of several million dollars using SBIR/STTR, and have gone on to success in the broader market. This doesn't really compare to Y Combinator, but it is (almost) free money. Uncle Sam dolla dolla bill, yo.