1. Blockchain and Potential Application in the Federal Market
Small Business Innovation Research (SBIR) Grants
December 19, 2016

2. Agenda What is blockchain? Potential Use Cases What is SBIR?
What agencies are participating?
What is the process?
Translation – what does it mean?
DHS SBIR Example
Opportunity to solve interesting problems
Blockchain Business Development Model & Resources
What’s Next?

3. What is blockchain?
A blockchain is a public ledger (like a database) of all transactions that have ever been executed. Other types of information can also be stored on the Blockchain.
It is constantly growing as ‘completed’ blocks are added to it with a new set of recordings.
Blockchain is a secured way of online transaction.[19] A blockchain is a decentralized digital ledger that records transactions on thousands of computers globally in such a way that the registered transactions cannot be altered retrospectively.[20][1] They are authenticated by mass collaboration powered by collective self-interests.[21] The result is a robust workflow where participants' uncertainty regarding data security is marginal. The use of a blockchain removes the characteristic of infinite reproducibility from a digital asset. It confirms that each unit of digital cash was spent only once, solving the long-standing problem of double spending. Blockchains have been described as a value-exchange protocol.[12] This exchange of value can be completed more quickly, safely and cheaper with a blockchain.[22] A blockchain can assign title rights because it provides a record that compels offer and acceptance.[1] From the technical point of view a blockchain is a hashchain inside another hashchain.[23]
A blockchain database consists of two kinds of records: transactions and blocks.[1] Blocks hold batches of valid transactions that are hashed and encoded into a Merkle tree.[1]Each block includes the hash of the prior block in the blockchain, linking the two. Variants of this format were used previously, for example in Git, and it is not by itself sufficient to qualify as a blockchain.[24] The linked blocks form a chain.[1] This iterative process confirms the integrity of the previous block, all the way back to the original genesis block.[25]Some blockchains create a new block as rapidly as every five seconds.[26] As blockchains age they are said to grow in height. Blocks are structured by division into layers.[citation needed]

4. What is blockchain? (cont.)
The blocks are added to the blockchain in a linear, chronological order.
Each node (computer connected to the network using a client that performs the task of validating and relaying transactions) gets a copy of the blockchain, which gets downloaded automatically upon joining the network.
The blockchain has complete information about the addresses and their balances right from the genesis block to the most recently completed block.

5. What is blockchain? (cont.)
The block validation system ensures that nobody can tamper with the records. Rather, old transactions are preserved forever and new transactions are added to the ledger irreversibly. Anyone on the network can check the ledger and see the same transaction history as everyone else.
Effectively a blockchain is a kind of independent, transparent, and permanent database coexisting in multiple locations and shared by a community. This is why it’s sometimes referred to as a mutual distributed ledger (MDL).

6. What is blockchain? (cont.)

7. Potential Blockchain Use Cases
Identity Management
Real Estate
Records (Birth, Marriage, Death Certificates)
Voting
Passports
Education
Medical Records
Financial / Banking
Property Management & Ownership
Smart Contracts
Land Management
Chain of Custody Management

8. Existing Use Cases

9. What is SBIR?
The Small Business Innovation Research (or SBIR) program is a United States Government program, coordinated by the Small Business Administration (SBA), intended to help certain small businesses conduct research and development (R&D). Funding takes the form of contracts or grants.

10. What is SBIR (cont.)
Federal agencies with extramural R&D budgets over $100 million to set aside a percentage of their annual extramural R&D budget for small businesses. This percentage was 2.5% prior to FY 2012, and increased to 2.6% in FY 2012 and will continue to increase by 0.1% each year until it reaches a base requirement of 3.2% in FY 2017.

11. What agencies participate?
These are the agencies are participating in SBIR:
Department of Agriculture
Department of Commerce
Department of Defense
Department of Education
Department of Energy
Department of Health and Human Services
Department of Homeland Security
Department of Transportation
Environmental Protection Agency
National Aeronautics and Space Administration

12. What is the Process?
The SBIR program has the goal of increasing the participation of innovative and creative U.S. small businesses in federal research and development programs and challenging industry to bring innovative solutions to reality.

13. Process (cont.)
The program consists of three phases:

14. Process (cont.) Phase Description:
Phase I: Feasibility/Proof of Concept. Using a competitive process, federal agencies award up to $150,000 to a small business to perform research/research and development (R/R&D) for up to 6-12 months on a specific topic in order to establish its technical merit, feasibility, and commercial potential. During this phase, federal agencies assess both the performance of the small business and the potential of the technology prior to providing further Federal support in Phase II.

15. Process (cont.) Phase Description:
Phase II: Full Research and Development. Based on the results achieved in Phase I, federal agencies will decide whether to continue R/R&D efforts into Phase II based on the scientific, technical, and commercial merit and feasibility of the idea. If the federal agency decides to continue into Phase II, they will award up to $1 million to the small business to continue R/R&D efforts for up to 2 years.

16. Process (cont.) Phase Description:
Phase III – Commercialization. No specific SBIR funding is associated with Phase III. The objective of Phase III, is for the small business to pursue commercialization objectives resulting from the Phase I/II activities. The Small Business Act defines commercialization as:
“the process of developing products, processes, technologies, or services; and”
“the production and delivery (whether by the originating party or by others) of products, processes, technologies, or services for sale to or use by the Federal Government or commercial markets. ”
A significant advantage to Phase I/II award winners is that federal agencies may pursue sole source contracts to utilize technology developed through prior SBIR/STTR awards which automatically qualify as a Phase III activity.

17. What does it mean?
Government-speak has a language all its own; here’s a translation to the official-speak:
Pre-solicitation Announcement - Actual announcement of the R&D topics that the Government is interested in funding.
Made fifteen days before the actual program solicitation.
The 15 day window is important because it is the only time that a small biz interested in the topic can talk to the actual technical program manager who authored the topic.
Take advantage of this window, because once the Program Solicitation comes out, so does the cone of silence for the PM who is then not allowed to talk to you!

18. What does it mean? (cont.)
Program Solicitation - This is the actual request for proposals to be submitted as responses to the R&D topics.
This time window lasts roughly a month.
The solicitation will contain the information on the format and logistics for the submission.
Everything Else - The usual things happen here. Proposal reviews and selections followed by award notifications and the actual contract award.

19. DHS SBIR Example
The Department of Homeland Security (DHS) Science and Technology Directorate (S&T) announced a total of $3.1 million in competitive research awards for 29 small businesses located across 12 states, and Washington, D.C. Each business was awarded approximately $100,000 in preliminary funding through DHS S&T’s Small Business Innovation Research (SBIR) program. (6/7/2016) *

20. DHS SBIR Example (cont.)
DHS SBIR Blockchain Award Topic Areas:
Security Systems Video and Audio Interoperability
Applicability of Blockchain Technology to Identity Management and Privacy Protection
Malware Prediction for Preemptive Cyber Defense
Autonomous Indoor Navigation and Tracking of First Responders
Internet of Things (IoT) Low-Cost Flood Inundation Sensor
Low-Cost, Real-Time Data Analytics for Underserved EMS Agencies
Real-Time Assessment of Resilience and Preparedness
Using Social Media to Support Timely and Targeted Emergency Response Actions
Blockchain Applications for Homeland Security Analytics
Remote Identity Proofing Alternatives to Knowledge Based Authentication and Verification *

21. Opportunity to solve problems
SBIRs are a great opportunity for innovators, small businesses, and start-up's in the U.S. to solve real and interesting problems which exist in the marketplace. The fact that the Government wants to help you succeed in your go-to-market strategy is simply an indicator that the commercialization opportunity for these topics aligns with a potential public good.
The Program Manager official contact information is provided with the full text of the topics. If you believe that you have an approach or solution that should be explored when it comes to these topics, I would recommend applying.

22. Next Steps Fill Out Blockchain Research Funding Team Interest Form
We will collect and facilitate teaming relationships
We will facilitate and introduction meeting to discuss pursuit of research funding
Each team will be self-directing

23. Government Blockchain Support
Engage
Networking Tools (Directory)
Orientation Support (Library)
Train
Intro to Blockchain & Crypto Currencies
Government Blockchain Workshop
Consult
Consultant Directory
Consulting Credentialing
Consulting Tools & Resources
Develop
Product Development Tool Directory & Reviews
Blockchain Development Training
Product Directory

24. How You Can Help Volunteer
Website support
Publication support
Create content
Speakers at events
List Your Product or Service in the Government Blockchain Directory
Send to

25. ??? Questions/Contact: www.commonsensesol.com