Small Business Technology Transfer (STTR) program offer small businesses an opportunity to secure much needed and hard to find funding to conduct research on behalf of the government. The SBIR Program is a highly competitive three-phase award system designed to allow small businesses to serve as the prime contractors (SBIR) or subcontractors (STTR) in meeting the federal government’s research needs. There are 11 federal agencies that offer SBIR awards and some 4 or 5 agencies that also have an STTR program.
What are the three phases of the SBIR Program?
- Phase I is a feasibility study to evaluate the scientific and technical merit of an idea. The awards and time lengths vary by agency but Phase I’s can be awarded for periods of up to six (6) months in amounts up to $100,000.
- Phase II is to expand on the results of and further pursue the development of Phase I. Again awards vary by agency but range from periods of up to two (2) years in amounts up to $500,000.
- Phase III is for the commercialization of the results of Phase II and requires the use of private sector or non-SBIR federal funding.
Is this a loan?
No, this is a government contract or grant. Your firm will have to meet the federal agency’s requirements to complete the proposed work in a timely and efficient manner. It is research so there is no required payback for the funding as it is either a research grant or contract.
How Much Funding is available through the SBIR Program?
Each agency participating in the SBIR program sets its own maximum award amount. Smaller agencies make fewer awards and have smaller grants or contracts. A typical Phase I feasibility study is six months to conduct the research and the funding levels can range from $70,000 to $125,000. Some of the larger agencies actually include an Option Task for continuing the research during the break in funding between Phase I and Phase II. Phase II research is generally 2 years of contract or grant work and funded at anywhere from $100,000 to $750,000 depending upon the agency and the individual topic.