SBIR Series: Fit, Feasibility, and a Go/No-Go You Can Trust
The Small Business Innovation Research (SBIR) program dangles a juicy carrot: non-dilutive federal funding to turn your tech idea into a reality. No equity. No payback. Just funding to validate, build, and scale. Sounds like a no-brainer, right?
Not so fast.
The SBIR path isn’t for everyone. It’s rigorous. It’s competitive. And it’s slower than most commercial founders are used to. Before you spend 100+ hours on a proposal, or hire a consultant to write one, you need to gut-check: Is this a fit? That’s what we’ll help you do in this post.
By the end, you’ll know whether SBIR is worth your time this year, and you’ll have a practical tool to support that decision.
A Plain-English SBIR Primer
Let’s start with the basics:
SBIR vs. STTR: Both fund R&D through small businesses, but STTR requires a formal research partner (e.g., university, FFRDC). SBIR does not.
Phases:
Phase I: Feasibility study, prove the concept can work.
Phase II: Prototype or MVP, build and test a working solution.
Phase III: Scale using non-SBIR funds (private capital or federal contracts).
Award amounts vary by agency; as of October 2024, the SBA allows agencies to issue Phase I awards up to $314,363 and Phase II up to $2,095,748 without a waiver.
Non-dilutive funding: You don’t give up equity. Uncle Sam writes the check, but you keep control.
Timelines are agency-specific. For example:
NSF: Decisions typically arrive 5–7 months after the deadline.
NIH: Award cycles often run ~10–12 months from application to funding.
Phase I durations are commonly 6–12 months (some NIH projects may go up to 24 months).
Phase II timing and submission windows vary by agency.
Success odds: Funding rates vary by agency and year. NSF Phase I ranges from ~10–20%, while DoD has historically averaged ~14–16%.
Can You Actually Deliver on an SBIR?
Here’s a quick self-check. Be honest. If you can’t confidently answer “yes” to most of these, hold off or get help.
Tech Maturity (TRL Check)
Can you clearly describe where your tech is today, and what it needs to get to prototype stage?
TRL 1–3: Basic idea or early concept. Often too early, depending on the agency/topic.
TRL 4–6: Validated in lab or demo setting. Generally Phase I sweet spot.
TRL 7+: Working system prototype, often aligned with late Phase II or Phase III. Some agencies (e.g., DoD) look for this.
Team Capacity
Do you have the time and talent to deliver a real R&D effort?
A Principal Investigator (PI) with technical chops
For SBIR: PI must be primarily employed (>50%) by the small business during the project.
For STTR: PI can be from either the small business or the research institution.
A compliant business:
UEI from SAM.gov
Active SAM registration (required for most SBIR proposals, some agencies require it before submission)
Risk Flags
These don’t disqualify you, but they may slow things down:
Export controls (ITAR, EAR): Does your tech have military or dual-use applications?
Human subjects research (IRB): Are you working with patient data or human testing?
Intellectual property: Do you own the core IP? Can you protect it?
Decision Tree: Go, Wait, or Walk Away
Use this as your sanity check:
PURSUIT NOW
TRL 3–6
Clear problem/solution
Team with technical and administrative bandwidth
No major compliance blockers
WAIT & MATURE
TRL too low (basic concept only)
Team not ready or lacks a strong PI
IP unclear or unprotected
No clear customer need yet
NOT A FIT (for now)
Tech too mature or already commercial
No R&D challenge to solve
Founder wants fast capital, not research funding
Can’t (or won’t) navigate 9–18 month federal timelines
SBIR/STTR are competitive grants or contracts for R/R&D, not for purchasing an off-the-shelf product. Phase III follow-on work uses non-SBIR funds.
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