The Small Business Innovation Research (SBIR) program is a highly competitive program that encourages domestic small businesses to engage in Federal R&D that has the potential for commercialization.
Most innovations come from small entrepreneurial businesses – but the risk and expense of conducting serious R&D efforts are often beyond their means.
SBIR funds the critical startup and development stages, and encourages the commercialization of the technology, product, or service. Since its enactment in 1982, the SBIR program has helped thousands of small businesses to compete for federal R&D awards.
Federal agencies with R&D budgets over $100 million are required to allocate 3.2% of their R&D budget to these programs.
Eleven Federal agencies currently participate in the SBIR program. Each agency administers its own individual program, within guidelines established by Congress. 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.
Participating agencies include
- Department of Agriculture
- Department of Commerce – National Institute of Standards and Technology
- Department of Commerce – National Oceanic and Atmospheric Administration
- 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
The SBIR Program is structured in three phases:
Phase I establishes the technical merit, feasibility, and commercial potential of the proposed effort, and determines the quality of performance of awarded company.
Phase II continues the R&D efforts initiated in Phase I. Funding is based on the results achieved in Phase I, and the scientific/technical merit and commercial potential of the proposed project.
In Phase III the small business objective is to pursue commercialization resulting from the previous activities.
For FY18, a Phase I award generally will not exceed $163,952, for 6 months, and a Phase II award generally will not exceed $1,093,015, for 2 years – although larger awards can be made at the agency’s discretion. The SBIR program does not fund Phase III, although some agencies may award follow-on contracts for products, processes or services.