SBIR

The SBIR program is one of the largest sources of early-stage technology funding in the United States. Eleven federal agencies with R&D budgets over $100 million are required to allocate 3.2% of their extramural research budgets to SBIR awards. This adds up to over $4 billion annually.

SBIR is structured in three phases. Phase I is a feasibility study ($50K-$275K over 6-12 months). Phase II is full R&D ($500K-$1.8M over 24 months). Phase III is commercialization, where the company pursues production contracts or commercial sales using non-SBIR funding.

The key advantage of SBIR is that it is non-dilutive — you do not give up equity and you do not repay the funding. The company retains intellectual property rights, subject to certain government use rights. This makes SBIR dramatically more founder-friendly than venture capital for deep-tech companies.

In 2026, Congress created "strategic breakthrough" SBIR awards of up to $30 million for technologies deemed critical to national security, making the program even more relevant for defense-adjacent startups.