To tech startups, small biz grants are small potatoes

One tool government agencies can use to nurture innovation is the Small Business Innovation Research grant, but is it a bold enough tool for the Pentagon?Participants at a Defense News-hosted roundtable in December said no.The investment research program, which is run by the Small Business Administration, requires federal agencies set aside a certain percentage of their of research and development funds for outside researchers with small firms.SBIR offers three tiers of R&D funding for new technologies, of $150,000 or less at Phase I, which lasts about six months; up to $1 million at Phase II, or about two years; Phase III funding tests the commerciality of the technology and solicits funding from the private sector.To Trae Stephens, a partner at the Silicon Valley venture capital firm Founders Fund and the chairman of tech company Anduril Industries, the Pentagon would be better off making a few big bets instead of many smaller investments. He likened it to his experience at a venture capital firm.