John Miller is the Deputy Associate Administrator for SBA's Office of Capital Access.
You are here
Office of Capital Access | Resources
Competitive Opportunity for Small Business:
SBIR and STTR are highly competitive programs that encourage small business to explore their technological potential and provide the incentive to profit from commercialization opportunities. By including qualified small businesses in the nation's R&D arena, high-tech innovation is stimulated and the United States gains entrepreneurial spirit as it meets its specific research and development needs.
These two programs target the entrepreneurial sector because that is where most innovation and innovators thrive. However, the risk and expense of conducting serious R&D efforts are often beyond the means of many small businesses. By reserving a specific percentage of federal R&D funds for small business, SBIR and STTR protect the small business and enable it to compete on the same level as larger businesses. This program funds the critical startup and development stages and it encourages the commercialization of the technology, product, or service, which, in turn, stimulates the U.S. economy.
Since its enactment in 1982, as part of the Small Business Innovation Development Act, this program has helped thousands of small businesses to compete for federal research and development awards. Their contributions have enhanced the nation's defense, protected our environment, advanced health care, and improved our ability to manage information and manipulate data.
Small businesses must meet certain eligibility criteria to participate in the SBIR or STTR programs. Complete details on eligibility can be found on SBIR.gov but in quick synopsis your small business firm should include:.
- American-owned and independently operated
- Principal researcher employed by business
Company size limited to 500 employees
The SBIR System:
Each year, eleven federal departments and agencies are required by SBIR to reserve a portion of their R&D funds for award to small business.
- 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
- National Science Foundation
These agencies designate R&D topics and accept proposals.
The SBIR and STTR Programs are structured in three phases:
Phase I. The objective of Phase I is to establish the technical merit, feasibility, and commercial potential of the proposed R/R&D efforts and to determine the quality of performance of the small business awardee organization prior to providing further Federal support in Phase II. SBIR Phase I awards normally do not exceed $150,000 total costs for 6 months.
Phase II. The objective of Phase II is to continue 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. Only Phase I awardees are eligible for a Phase II award. SBIR Phase II awards normally do not exceed $1,000,000 total costs for 2 years.
Phase III. The objective of Phase III, where appropriate, is for the small business to pursue commercialization objectives resulting from the Phase I/II R/R&D activities. The SBIR program does not fund Phase III. Some Federal agencies, Phase III may involve follow-on non-SBIR funded R&D or production contracts for products, processes or services intended for use by the U.S. Government.
The US Small Business Administration plays an important role as the coordinating agency for the SBIR program. It directs the 11 agencies' implementation of SBIR, reviews their progress, and reports annually to Congress on its operation. SBA is also the information link to SBIR. SBA collects solicitation information from all participating agencies and publishes it quarterly in a Pre-Solicitation Announcement (PSA). The PSA is a single source for the topics and anticipated release and closing dates for each agency's solicitations.
For more information on the SBIR Program, please visit http://www.sbir.gov.
All of SBA's programs and services are extended to the public on a nondiscriminatory basis.