Small Business Innovation Research Program

Congress established the SBIR Program in 1982 to provide opportunities for small businesses to participate in Federal government-sponsored research and development (R&D). The SBIR Program must be reauthorized by Congress for its continued administration. The reauthorization process gives Congress the opportunity to assess, adjust, or refocus the program and funding in key ways to meet emerging needs and trends. The goals of the SBIR Program are to:

Stimulate technological innovation;

Use small business to meet Federal R&D needs;

Foster and encourage participation by socially and economically disadvantaged small business concerns (SBCs), and by SBCs that are 51 percent owned and controlled by women, in technological innovation; and

Increase private sector commercialization of innovations derived from Federal R&D, thereby increasing competition, productivity and economic growth.

A Congressional mandate requires all Federal agencies with an annual extramural R&D budget exceeding $100 million participate in the SBIR Program. The SBIR program budget is computed as 2.5 percent of the Agency’s extramural R&D budget.

Phase I is a feasibility study that determines the scientific, technical, and commercial merit and feasibility of a selected concept. Phase I projects are competitively selected from proposals submitted against solicitations. Each solicitation contains topics seeking specific solutions to stated Federal government needs. The Phase I selection process is highly competitive, with about one of 10 submitted Phase I proposals receiving awards.

Phase II represents a major research and development effort, culminating in a well defined deliverable prototype (i.e., a technology, product, or service). The Phase II selection process is also highly competitive. Successful Phase I contractors are invited to submit Phase II proposals as there are no separate Phase II solicitations.

In Phase III, the small business or research institution is expected to obtain funding from the private sector and/or non-SBIR government sources to develop the prototype into a viable product or service for sale in the government or private sector markets.

Eligibility Requirements

The SBIR program is open to any small business, defined as a business having no more than 500 employees (including all affiliates), which is operated in the United States, and at least 51 percent-owned by a U.S. citizen or permanent resident alien. The small business may subcontract a portion of its work, as long as the small business “prime” performs at least two-thirds of the Phase I work and one-half of the Phase II work. For the purposes of determining compliance, percent of work is usually measured by both direct and indirect costs; however, the actual method of measurement will be verified during contract negotiations.

For SBIR program Phase I and II efforts, the primary employment of the principal investigator must be with the small business firm at the time of the award and for the duration of the proposed project effort. Primary employment means that more than one-half of the principal investigator’s time is spent with the small business.

The Phase I and Phase II work must be performed in the United States, to include the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the Trust Territory of the Pacific Islands, and the District of Columbia.

Solicitations

DoD generally issues three SBIR solicitations each year. The table below cites specific months of the year, but the actual dates are usually announced. DARPA currently participates in all three SBIR solicitations. Check the DoD SBIR/STTR website at www.acq.osd.mil/osbp/sbir/ for the latest solicitation dates.

Phase II Enhancement Program

DARPA will provide a Phase II performer up to $200,000 of additional Phase II SBIR funding if the performer can match the additional SBIR funds with non-SBIR funds from DoD core mission funds, another Federal agency, or the private sector. Generally, the additional Phase II funds received from other government sources are applied to the Phase II contract, which may be extended for up to 1 year. Phase II enhancements are subject to the availability of funds.

Fast Track Program

DARPA encourages Phase I performers to discuss their intention to pursue the “Fast Track” process with the Technical Office Program Manager (PM) prior to submitting a Fast Track application or proposal. Selection of a Fast Track proposal is not mandated and DARPA retains the discretion not to select or fund any Fast Track proposal. The performer and the investor are required to submit a Fast Track application through the DoD Submission website no later than the last day of the 6th month of the Phase I effort. The Fast Track Interim funding amount is not to exceed $40,000. The performer must submit its Phase II proposal before the last day of the 7th month of the Phase I effort.

The final decision on Phase II Fast Track awards is made by the PM. DARPA’s Director of Small Business Programs will notify each Fast Track applicant, in writing, whether or not it has been selected for a Phase II award. All funding decisions are subject to the successful completion of negotiations and the availability of funds. For additional information on the process, contact the SBIR and STTR program management office.

Adoption, Co-funding, and Working with Other Federal Agencies

Sometimes opportunities arise to adopt or co-fund another DoD Component’s or Federal agency’s SBIR Phase II project. At the discretion of the PM, DARPA may consider adopting or co-funding a project if it is in DARPA’s best interest. If a project adoption or co-funding arrangement is approved, DARPA will assign a PM to the project. Requests for project adoptions and co-funding will be evaluated and approved in writing by DARPA’s Deputy Director. [Note: An SBA ruling determined that there can be no commingling of funds between the SBIR and the STTR programs. This ruling also prevents Federal agencies from soliciting or awarding Phase II SBIR contracts based on Phase I STTR participation or vice versa. SBA describes the SBIR and STTR programs as being based on distinct law, with distinct legislative history, goals, and budgets, and therefore, not interchangeable programs.

SBIR Phase II Instructions

The following information provides instructions for submitting a Phase II SBIR proposal. (download .pdf)

DARPA-Funded Research Involving Human Subjects and/or Animals

The following information provides guidance for Small Business Innovation Research (SBIR) and Small Business Technology Transfer Research (STTR). (download .pdf)

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