Small Business Innovation Research (SBIR) Small Business Technology Transfer (STTR)

About

The Small Business Innovation Research (SBIR) program is a United States Government program, coordinated by the Small Business Administration, and currently authorized through September 30, 2017, in which all federal agencies with extramural research budgets in excess of $100 million have a percentage reserved for contracts or grants to small businesses.

The percentage of funds reserved for each fiscal year follow the schedule below:

  • not less than 2.6 percent of the total extramural research budget for fiscal year 2012
  • not less than 2.7 percent of the total extramural research budget for fiscal year 2013
  • not less than 2.8 percent of the total extramural research budget for fiscal year 2014
  • not less than 2.9 percent of the total extramural research budget for fiscal year 2015
  • not less than 3.0 percent of the total extramural research budget for fiscal year 2016
  • not less than 3.2 percent of the total extramural research budget for fiscal year 2017

Annually, the DoD SBIR budget represents more than $1 billion in research funds. Over half the awards are to firms with fewer than 25 people and a third to firms of fewer than 10. A fifth are minority or women-owned businesses. Historically, a quarter of the companies are first-time winners.

Congress established the Small Business Technology Transfer (STTR) Program in 1992. It is similar in structure to SBIR and funds cooperative research and development projects with small businesses in partnership with not-for profit research institutions (such as universities) to move research to the marketplace. This program is also authorized through September 30, 2017 for all federal agencies with extramural research budges in excess of $1 billion.

The percentage of funds reserved for each fiscal year follow the schedule below:

  • 0.35 percent of the total extramural research budget in fiscal years 2012 and 2013
  • 0.40 percent of the total extramural research budget in fiscal years 2014 and 2015
  • 0.45 percent of the total extramural research budget in fiscal years 2016 and beyond

The SBIR/STTR Programs are structured in three phases. Phase I (project feasibility) determines the scientific, technical and commercial merit and feasibility of the ideas submitted. Phase II (project development to prototype) is the major research and development effort, funding the prototyping and demonstration of the most promising Phase I projects. Phase III (commercialization) is the ultimate goal of each SBIR/STTR effort and statute requires that Phase III work be funded by sources outside the SBIR/STTR Program.

Governing Laws & Directives

The SBIR and STTR programs are governed and regulated by a number of federal statutes, public laws, policy directives, DoD memoranda and Executive Orders found in this section.

Commercialization

Phase III commercialization work derives from, extends, or logically concludes efforts performed under prior SBIR/STTR funding agreements. Small businesses are expected to obtain additional funds from the private sector, and/or non-SBIR/non-STTR government sources to develop Phase II prototypes into viable products for sale in the marketplace. Within the DoD, often the initial customer is a prime contractor for a major weapon system or other program of record.

Program Reports

Annual and other periodic reports required by law on the SBIR and STTR programs can be found in the Program Reports section.

You can also download spreadsheets containing total Awards, Commercialization and Socioeconomic results by State and by Component for Fiscal Years 2008–2010.

Program Objectives

The SBIR and STTR programs are designed to:

  • Stimulate technological innovation
  • Increase private sector commercialization of federal research and development (R&D)
  • Increase small business participation in federally funded R&D
  • Foster participation by minority and disadvantaged firms in technological innovation

Results

Historically, about 15 percent of SBIR and STTR proposals are awarded a Phase I contract; approximately 50 percent of Phase I projects subsequently are awarded a Phase II contract. See our history of the DoD SBIRExternal Link and STTRExternal Link programs.