Data sourced from SAM.gov, USAspending, FPDS, Grants.gov. 110+ supplementary federal data feeds. View methodology →
100M+ government records · 110+ gov/news sources · Synced from live federal sources
Explore 100M+ federal records across SAM.gov, Grants.gov, USAspending, FPDS, and 110+ federal sources.
Search all opportunities →The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs are the federal government's largest source of early-stage R&D funding for small businesses. With over $4 billion awarded annually across 11 agencies, these programs provide non-dilutive funding to develop innovative technologies from concept through commercialization.
This guide covers how the programs work, the three phases, participating agencies, the valuable data rights protections, and practical tips for writing winning proposals.
100M+ government records · 110+ gov/news sources · Synced from live federal sources
Both SBIR and STTR fund small business research and development, but they serve slightly different purposes and have different structural requirements. Understanding these differences helps you choose the right program for your innovation.
| Feature | SBIR | STTR |
|---|---|---|
| Research institution required? | No (optional) | Yes (mandatory partner) |
| Small business work minimum | 67% (Phase I), 50% (Phase II) | 40% (both phases) |
| Research institution work | No minimum | At least 30% |
| PI employment | Must be employed by small business | Can be at either organization |
| Participating agencies | 11 agencies | 5 agencies (DoD, NIH, DOE, NASA, NSF) |
| Set-aside percentage | 3.2% of extramural R&D budget | 0.45% of extramural R&D budget |
STTR is ideal when your innovation requires deep collaboration with a university or research lab. SBIR is better when your small business has the technical expertise in-house and wants maximum control over the work.
Phase I establishes the scientific, technical, and commercial merit and feasibility of the proposed innovation. You are proving that your concept works and that there is a path to practical application. The deliverable is typically a final report demonstrating proof of concept, initial prototyping results, and a plan for Phase II development.
Phase II is the principal R&D effort. Based on Phase I results, you develop the technology into a working prototype or pre-production version. Phase II proposals must demonstrate Phase I success, present a detailed development plan, and include a commercialization strategy. Only Phase I awardees are eligible for Phase II (with some Direct to Phase II exceptions).
Phase III is the commercialization phase where the technology transitions from R&D to real-world use. Critically, Phase III is not funded through the SBIR set-aside — it uses regular procurement dollars or private investment. Phase III contracts are not set aside for small businesses, meaning you compete with large businesses. However, SBIR data rights from Phases I and II carry forward, giving you a competitive advantage.
Eleven federal agencies with extramural R&D budgets exceeding $100 million are required to participate in SBIR. Five of these also participate in STTR. Each agency publishes its own solicitations with research topics aligned to its mission needs.
Largest SBIR funder (~$2B/yr). Topics span weapons, cyber, logistics, medical.
Second largest. Biomedical research, drug development, diagnostics, health IT.
Clean energy, nuclear, computational science, materials research.
Aerospace, earth science, space technology, propulsion.
Broad technology focus. America's Seed Fund. No specific topics — any innovation.
Agricultural technology, food safety, rural development.
Measurement science, standards, manufacturing, cybersecurity.
Education technology, learning tools, accessibility.
Border security, cybersecurity, first responder tech, counter-terrorism.
Autonomous vehicles, aviation safety, infrastructure, transit.
Environmental monitoring, remediation, green chemistry, water quality.
SBIR data rights are one of the most valuable benefits of the program and are often underappreciated by first-time applicants. Under the SBIR/STTR Policy Directive, small businesses retain protection over data developed under SBIR/STTR funding for a period of 20 years from the date of completion of the contract.
During this 20-year protection period:
This 20-year protection is significantly stronger than the standard data rights provided under government contracts (typically “unlimited rights” for government-funded development). It gives SBIR awardees a competitive moat — competitors cannot duplicate your approach using government data, and you maintain control over how the technology is commercialized.
To preserve your SBIR data rights, you must properly mark all deliverables with the SBIR data rights legend. Failure to mark data can result in the government treating it as unlimited rights data. Work with your contracts team to ensure proper marking on all technical reports, software, and documentation.
SBIR/STTR proposals are evaluated on scientific/technical merit, qualifications of the team, and commercialization potential. Here are practical strategies for strengthening your proposal at each phase:
Read the full topic description, not just the title. Contact the Topic Author (for DoD) or Program Director (for NIH/NSF) before submitting. They can clarify what they are looking for and whether your approach aligns with their needs. This pre-submission engagement is encouraged and can save you from pursuing misaligned topics.
Reviewers want to know what is new. Clearly articulate how your approach differs from and improves upon existing solutions. Reference the state of the art and explain your specific technical innovation. Avoid generic descriptions — be specific about what makes your approach novel.
Include preliminary data, modeling results, or proof-of-concept evidence wherever possible. Phase I proposals that show some initial validation of the approach score higher than purely conceptual proposals. Even limited bench-top testing or computational modeling strengthens your case.
Agencies increasingly weight commercialization potential. Identify your target market (government and commercial), estimate market size, describe your go-to-market strategy, and show evidence of customer interest (LOIs, pilot agreements, customer discovery interviews). Phase II proposals must include a detailed commercialization plan.
Key personnel resumes should demonstrate directly relevant technical expertise. For STTR, the research institution partner should bring complementary capabilities. Include advisors or consultants with domain expertise if your core team lacks specific qualifications.
Budgets that are too low raise feasibility concerns; budgets that are too high face scrutiny. Align your budget with the proposed work scope. Include adequate funding for prototyping, testing, and customer engagement. Do not pad budgets with unnecessary equipment or excessive travel.
All SBIR/STTR Phase II proposals require a commercialization plan, and agencies increasingly consider commercialization potential in Phase I evaluations as well. A strong commercialization plan demonstrates that your innovation has real-world market potential and that you have a credible path to revenue.
Your commercialization plan should address:
Letters of intent from potential customers, pilot agreements, or expressions of interest from strategic partners significantly strengthen your commercialization plan. Agencies want to see evidence that customers are interested, not just assertions that a market exists.
Both programs fund small business R&D, but they differ in collaboration requirements. SBIR requires the small business to perform at least two-thirds (Phase I) or one-half (Phase II) of the work. STTR requires a formal collaboration with a research institution (university, FFRDC, or nonprofit research organization) that must perform at least 30% of the work, with the small business performing at least 40%.
Typical awards are $150,000-$275,000 for Phase I (6-12 months) and $750,000-$1.75 million for Phase II (2 years). Some agencies offer higher amounts — DoD awards can exceed $1.75M for Phase II, and NIH Phase II awards can reach $1.75M. Phase III has no funding cap and no set-aside — it is competitive with large businesses and funded through regular procurement dollars.
SBIR data rights give small businesses protection over data generated under SBIR/STTR funding for 20 years from contract completion. During this period, the government cannot disclose the data to third parties or use it for procurement purposes without the company's permission. This protection is significantly stronger than standard government data rights and gives companies a competitive moat for commercializing their innovations.
SBIR/STTR eligibility requires the company to be organized for profit, with its principal place of business in the United States, at least 51% owned by U.S. citizens or permanent residents (or by another SBIR-eligible small business), and have fewer than 500 employees. Companies majority-owned by foreign nationals, foreign governments, or foreign companies are generally ineligible.
Search across SAM.gov and SBIR.gov for current SBIR and STTR solicitations. Filter by agency, research topic, phase, and award size to find opportunities aligned with your technology.