sttr

The Small Business Innovation Research (SBIR) program is one of the federal government's most substantial investments for moving innovation from America’s small businesses into the private market or federal procurement in areas like defense, space, energy or transportation.

A two-page proposal for a $40,000 Phase IA award? Phase II performance ratios required for companies receiving 10 and 25 Phase I awards over their lifetime? Halving the budget for STTR and shrinking university partner share? Creating a 0.25% carve-out of DOD SBIR funds for phase III awards up to $30M each? Limiting all federal technical assistance and outreach to 25 states with the fewest SBIR/STTR awards? Stronger, broader, tougher foreign risk requirements for the companies and agency due diligence? 

The U.S. Department of Energy (DOE) has reduced its funding for the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. The cut at the Office of Science—the agency’s primary program administrator—appears to be about 35%. The change resulted from congressional direction that the agency had miscalculated its SBIR set-aside and is intended to make the Office of Science’s calculation more consistent with that of the other programs in DOE.

The U.S. Small Business Administration (SBA) recently announced 44 FAST awards, including 12 new awards,  totaling over $5.4 million, with each up to $125,000 for specialized training, mentoring, and technical assistance for research and development.

Entrepreneurs learned more about small business funding opportunities from federal agencies with Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs during America’s Seed Fund Week last week. The $4 billion funding program, which is currently up for reauthorization, is celebrating 40 years of providing funding to small businesses each year in a variety of technology areas.

In fiscal year 2021, the nationwide success rate of applicants for National Institutes of Health (NIH) Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) Phase I awards decreased slightly from FY 2020. This continued a downward trend over recent years. The success rate for NIH SBIR/STTR Phase I was nearly 13 percent (647 of 5,132 approved) in FY 2021, a decrease from nearly 14 percent (636 of 4,684 approved) in FY 2020 and from nearly 16 percent for all proposals submitted over the past decade.

The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs of the National Institutes of Health (NIH) supported the development of 99 drugs from 1996-2020 — a total that includes 16 percent of all such treatments that made a “significant” advance over available medicines.

SBA efforts to reign in abuse of the Small Business Innovation Research and Small Business Technology Transfer (SBIR/STTR) program continue, yet companies that seem to use SBIR awards as a primary revenue stream rather than a means to creating future revenue paths through new product and process innovations persist, based on SSTI’s review of award data. Known as “SBIR mills” many of these companies appear to be clustered geographically in specific metropolitan areas, many of which house major federal labs or research centers, the analysis of SBIR data reveals.

Consideration of a state’s trends in the distribution of SBIR awards by federal agency may help program leaders and policy makers optimize the design and performance for state and regional support of innovation-based startups. For instance, knowing which federal agencies provide the dominant share of awards in a state can inform a program’s marketing and outreach efforts, and, more importantly for the startups being assisted, it can guide recruiting the right mix of mentors and knowledge assets to a program’s technical assistance capabilities.

A recent report by the National Women’s Business Council (NWBC) and the Small Business Administration (SBA) found that participation rates in the Small Business Innovation Research and Small Business Technology Transfer (SBIR/STTR) programs by women-owned small businesses (WOSB) has essentially remained flat since 2011. Although participation rates vary by awarding agency, the report highlights several barriers faced by women entrepreneurs.