SBIR | STTR
$0 EQUITY. $0 DEBT
The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs are the largest federal financing programs designed to help U.S.-based small businesses & startups to cover their R&D costs with the potential for commercialization.
With an annual budget of $3.7 billion and 160,000 awards granted YTD, SBIR|STTR programs are aimed at the federal research and development needs, private-sector commercialization of innovation derived from federal research and development funding, and fostering technology transfer through cooperative R&D between small businesses and research institutions.
WHY SBIR|STTR FUNDING?
FY $3.7 billion non-dilutive funding available for startups & small businesses.
Up to $250,00 equity-free cash for ~ Phase I and ~$1M for Phase II.
Success rate of SBIR/STTR is ~ 17% for Phase I and ~60% for Phase II.
QUESTIONS?
What is the SBIR Program?
The SBIR program was established in 1982 with the purpose of strengthening the role of innovative small business concerns in Federally-funded research and development (R&D). Through FY2019, over 179,000 awards have been made totaling more than $54.3 billion.
The goal of SBIR is
→ Increase private-sector commercialization of innovation derived from federal research and development funding
→ Stimulate technological innovation
→ Foster and encourage participation in innovation and entrepreneurship by women and socially/economically disadvantaged individuals
→ Foster technology transfer through cooperative R&D between small businesses and research institutions (STTR)
What are the three phases of the SBIR Program?
The SBIR Program is structured in three phases:
Phase I. Phase I is designed for concept development, establishing the technical merit, feasibility, and commercial potential of the proposed R/R&D efforts. Phase I will also determine the eligibility of an awardee organization for Phase II.
SBIR/STTR Phase I awards are generally $50,000 - $250,000 for 6 months to 1 year.
Phase II. Phase II is designed for prototype development, and continuing the R/R&D efforts initiated in Phase I. Funding is based on the results achieved in Phase I and the scientific and technical merit and commercial potential of the project proposed in Phase II. Typically, only Phase I awardees are eligible for a Phase II award.
SBIR/STTR Phase II awards are generally $750,000 for 2 years.
Phase III. The objective of Phase III is for the small business to pursue commercialization resulting from the Phase I/II R/R&D activities. The SBIR/STTR programs do not fund Phase III. At some Federal agencies, Phase III may involve follow-on non-SBIR/STTR funded R&D or production contracts for products, processes or services intended for use by the U.S. Government.
Which Federal Agencies participate in the SBIR Program?
SBIR|STTR programs run by 11 Federal Agencies.
Department of Agriculture - The USDA SBIR program supports small businesses in the creation of innovative, disruptive technologies and enables the application of research advancements from conception into the market. Projects dealing with agriculturally related manufacturing and alternative and renewable energy technologies are encouraged across all SBIR topic areas.
Department of Commerce (National Institute of Standards and Technology) - NIST supports U.S. small businesses for advancing technologies in manufacturing, privacy, medical diagnostics, and more.
Department of Commerce (National Oceanic and Atmospheric Administration) - NOAA's SBIR Program is seeking highly innovative products with excellent commercial potential in areas, like Weather, Climate, Oceans, Fisheries, Satellites, Marine, Aviation, Coasts and Education.
Department of Defense (Navy, Air Force, Defense Health Agency (DHA) , and Defense Logistics Agency ) - DoD SBIR/STTR Programs focus on 5G spectrum, AI/ML, Autonomy, Biotechnology, Cybersecurity, Hypersonics, Microelectronics, Nuclear, Quantum Science, Space and Networked Command, Control, and Communications (C3).
Department of Education
Department of Energy
Department of Health and Human Services (Services (HHS) NIH, FDA, CDC, ACL )
Department of Homeland Security
Department of Transportation
Environmental Protection Agency
National Aeronautics and Space Administration
National Science Foundation
Each of these agencies has an SBIR program office and administers the program within guidelines established by Congress in the Small Business Act and by SBA in the SBIR Policy Directive. The agencies designate R&D topics in their solicitations and accept proposals from small businesses. Awards are made on a competitive basis after proposal evaluation.
What technologies are funded by SBIR Programs?
Advanced Analytics
Advanced Manufacturing
Advanced Materials
Artificial Intelligence
Aviation
Augmented and Virtual Reality
Biological Technologies
Biomedical Technologies
Chemical Technologies
Climate
Cloud and High-Performance Computing
Crop Production
Cybersecurity and Authentication
Digital Health
Distributed Ledger
Energy Technologies
Environmental Technologies
Fisheries
Food Production
Human-Computer Interaction
Instrumentation and Hardware Systems
Internet of Things
Learning and Cognition Technologies
Marine
Medical Devices
Mobility
Nanotechnology
Ocean
Pharmaceutical Technologies
Photonics
Power Management
Quantum Information Technologies
Robotics
Renewable Energy
Semiconductors
Space
Weather
Wireless Technologies
What types of businesses are eligible for SBIR/STTR?
Only U.S.-based small businesses are eligible to participate in the SBIR/STTR programs. A small business must meet the following criteria:
Organized for profit, with a place of business located in the United States
Work must be done in the U.S.
More than 50% owned and controlled by one or more individuals who are citizens or permanent resident aliens of the United States, or by other small business concerns that are each more than 50% owned and controlled by one or more individuals who are citizens or permanent resident aliens of the United States; and
No more than 500 employees, including affiliates
A company may be owned and controlled by more than one VC, hedge fund, or private equity firm so long as no one such firm owns a majority of the stock.
Phase I awardees with multiple prior awards must meet the benchmark requirements for progress toward commercialization.
Companies must focus on performing R&D and commercialization of a technology that has already been developed, or one that has very low risk and only needs capital.