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

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

Small Business Innovation Research (SBIR) is a competitive program that encourages small businesses to engage in Federal Research and Development (R&D) with the potential for commercialization to stimulate innovation.

Small Business Technology Transfer (STTR) is another program to facilitate cooperative R&D between small business concerns and non-profit U.S. research institutions with the potential for commercialization of innovative technological solutions.

Federal agencies with R&D budgets exceeding $100 million are required to allocate a percentage of their R&D budget to these programs. Participating agencies determine relevant R&D topics for their programs.

SBIR/STTR is a gated process with three (3) phases executed through BAA contracts, grants, or agreements:

  • Phase I: Explore technical merit and feasibility of an idea or technology and determine the quality of performance of the small business prior to providing further Federal support in Phase II. Contracts are no more than 6 months in duration and are funded by the SBIR/STTR program. Typically, Phase I awards are typically less than $150,000.
  • Phase II: Continue R&D efforts initiated in Phase I and evaluate commercialization potential. Contracts are no more than 24 months, are funded by the SBIR/STTR program, and typically are less than $1 million. Award amounts are based on Phase I results and scientific and technical merit for commercialization.
  • Phase III: Work that derives from, extends, or completes R&D efforts under prior SBIR/STTR Phase I/II and enables a small business to pursue commercialization. Phase III work may be for products (including test and evaluation), production contracts, and/or R&D activities. There is no limit on the number, duration, type, or dollar value of Phase III award. Phase III awards cannot be funded by the SBIR program. Agencies may enter into a Phase III SBIR contract at any time (competitively or non-competitively) with a Phase I or Phase II awardee.

Common Applications for SBIR Phase I and II

  • Research & Development (R&D) studies
  • Prototypes
  • Science & Technology (S&T) efforts
  • Technology maturation

Common Applications for SBIR Phase III

  • Solutions and technologies
  • IT software and products
  • R&D studies
  • Prototypes
  • S&T efforts
  • Technology maturation

Pros

Cons

Ability to award sole source to SBIR Phase I/Phase II vendors for Phase III work reduces procurement lead time SBIR/STTR data rights protection limits Government’s IP strategy
Phase III SBIR award procedures provide opportunity for acquisition programs to deliver capability quickly Technology insertion/transition process into program of record increases risk of project failure
Ability to uniquely negotiate terms and conditions, and pricing arrangements enables improved mission outcomes  

 

Restrictions

  • SBIR/STTR data rights protection: Apply to all phases and restricts the Government from disclosing SBIR data outside the Government. Government cannot compete technologies containing SBIR Data
  • Phase III contract awards may not be appropriate in all cases if multiple sources available in the open market for similar product

References

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