Small Businesses Lead the Way in Green Technology Innovation

Small Business

When it comes to green technology innovation, U.S. small businesses are leading the way according to a report released yesterday by the SBA Office of Advocacy. The report titled Analysis of Small Business Innovation in Green Technologies was released by Chief Counsel Winslow Sargeant at the World Green Energy Symposium in Philadelphia. The study was designed to highlight differences in the patent activity of small and large firms in green technologies and industries.

“Small businesses are leading the way in green technology innovation as they have with innovation over all,” said Sargeant. “It is important that government help foster innovation which leads to commercialization. At Advocacy, we support this process by helping to reduce the regulatory burden on small business.”

The report found that while small firms account for about 8 percent of all U.S. patents, they account for 14 percent of green technology patents. Small firms account for more than 32 percent of the patents in both smart grids and solar energy, and 15 percent of patents in batteries and fuel cells. Also eighty percent of the “prolific” inventors: those with five or more recent green patents with a citation index of 1 or more: from small green technology firms had previously worked at large companies, or large government or university labs.

Small innovative firms in this study are even more productive, measured in terms of patents per employee, than was shown in previous studies. The current study finds that small innovative firms are 16 times more productive than large innovative firms in terms of patents per employee. Small firms’ green technology patents are cited 2.5 times as often as large firms in other patent applications, indicating that small firms patents are more original and influential. In green technologies, while four times as many large as small innovative firms have at least one green patent, small firms are more likely than larger firms to have green technology as a core part of their business.

Previous Advocacy-funded studies of small business patenting activity established the existence of a cohort of independent, for-profit innovative small firms with 15 or more patents over a five-year period. The studies also showed that innovative small firms had a higher percentage of emerging technology patents in their portfolios than their larger counterparts. A recent focus on “green” jobs, businesses, and technology led to this study of a subset of these innovative patent holders. The report and research summary is available at

The Office of Advocacy of the U.S. Small Business Administration (SBA) is an independent voice for small business within the federal government. The presidentially appointed Chief Counsel for Advocacy advances the views, concerns, and interests of small business before Congress, the White House, federal agencies, federal courts, and state policymakers. Regional advocates and an office in Washington, D.C., support the Chief Counsel’s efforts. For more information, visit, or call (202) 205-6533.

SOURCE U.S. Small Business Administration

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