FAQs

What is the SBIR Program?

The Small Business Innovation Research (SBIR) Program is a highly competitive three-phase award system which provides qualified small business concerns with opportunities to propose innovative ideas that meet the specific research and research and development needs of the federal Government.

What are the three phases of the SBIR Program?

• Phase I is a feasibility study to evaluate the scientific and technical merit of an idea. Department of Education (ED) awards are for periods of up to six (6) months in amounts up to $100,000.
  
  
• Phase II is to expand on the results of and further pursue the development of Phase I. ED awards are for periods of up to two (2) years in amounts up to $500,000.
  
  
• Phase III is for the commercialization of the results of Phase II and requires the use of private sector or non-SBIR federal funding.

Do you have to be a Phase I awardee in order to be considered for Phase II of a project?

Yes.

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What is the small business size standard for purposes of the SBIR Program?

A small business concern for purposes of award of any funding agreement under the SBIR Program is one which, including its affiliates, has a number of employees not exceeding 500.

How does the Small Business Administration define "small business concern" for purposes of the SBIR Program?

It is defined as a concern that, on the date of award for both Phase I and Phase II funding agreements:

1. is organized for profit, with a place of business located in the United States, which operates primarily within the United States or which makes a significant contribution to the United States economy through payment of taxes or use of American products, materials or labor;
2. is in the legal form of an individual proprietorship, partnership, limited liability company, corporation, joint venture, association, trust or cooperative, except that where the form is a joint venture there can be no more than 49 percent participation by foreign business entities in the joint venture;
3. is at least 51 percent owned and controlled by one or more individuals who are citizens of, or permanent resident aliens in, the United States; and,
4. has, including its affiliates, not more than 500 employees.

How can a small business concern obtain funding under SBIR?

A small business can obtain funding under SBIR by being the recipient of a competitively awarded SBIR funding agreement.

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What is an SBIR funding agreement?

An SBIR funding agreement is a contract, grant, or cooperative agreement entered into between an SBIR participating federal agency and a small business concern for the performance of experimental, developmental, or research work, including products or services funded in whole or in part by the federal Government.

Does the Small Business Administration make any awards under the SBIR Program?

No. The SBA has authority and responsibility for monitoring and coordinating the Government-wide activities of the SBIR Program and reporting its results to Congress. The federal agencies participating in SBIR have the responsibility for: selecting SBIR topics releasing SBIR solicitations evaluating SBIR proposals awarding SBIR funding agreements on a competitive basis.

Can a firm go directly to a Phase II award without having to compete for Phase I?

No. The SBIR Program was created for NEW innovations to meet existing federal R&D needs. The results of a Phase I are a determining factor in deciding whether there will be a Phase II award to continue the effort. Does SBA designate any of the topics cited in SBIR solicitations or make any awards under SBIR? No. The legislation governing the SBIR Program gives unilateral authority and responsibility for these functions to each of the federal agencies participating in the program. Since SBIR is a program to assist small business innovators, can the federal participating agencies provide direct funding for a project which a firm has initiated on its own? No. Such an endeavor would be considered an unsolicited proposal, which is outside the scope of the SBIR Program.

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Will innovations that have been patented or have patents pending be considered under SBIR?

No. SBIR is a program for NEW high tech innovations.

Are foreign-based firms eligible for SBIR awards?

No. To be eligible for award of SBIR funding agreements, a small business concern has to meet the following qualifications: be independently owned and operated: principal place of business is located in the United States; at least 51 percent owned or in the case of a publicly owned business, at least 51 percent of its voting stock is owned by United States citizens or lawfully admitted permanent resident aliens.

Are non-profit concerns eligible for SBIR awards?

No.

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May a portion of an SBIR award be subcontracted?

Yes. For Phase I, a minimum of two thirds of the research and/or analytical effort must be performed by the proposing firm, and For Phase II, a minimum of one-half of the research and/or analytical effort must be performed by the proposing firm.

Can a federal agency other than the one originating the Phase I award make the Phase II award under the same SBIR topic?

Yes. The SBIR Policy Directive (September, 2002) states that: "An SBIR Phase II award may be issued by a federal agency other than the one that made the Phase I award. The Phase I and Phase II agencies should document their files appropriately, providing clear rationale for the transfer of the Phase II proposal to, and award by, the funding federal agency."

What is the difference between SBIR solicitations and the SBIR Pre-Solicitation Announcement?

SBIR solicitations are specific Requests for Proposals released by the federal agencies participating in the program which may result in the award of Phase I SBIR funding agreements. SBIR Pre-Solicitation Announcements, released by SBA, contain pertinent data on SBIR solicitations that are about to be released by the participating federal agencies.

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Can participating federal agencies provide funds for SBIR commercialization?

No. Private sources of capital should be used. However, the agencies can provide support for technical assistance. SBIR awardees are encouraged to seek information on all of the services made available to the small business community.

What is the "Fast-Track" mechanism and how does it work?

The "Fast-Track" mechanism (presently available in solicitations at IES) expedites the decision and award of SBIR Phase II funding for scientifically meritorious proposals that have a high potential for commercialization. Fast-Track incorporates a submission and review process in which both Phase I and Phase II proposals are submitted and reviewed together. The Phase I portion of a Fast-Track must specify clear, measurable goals (milestones) that should be achieved prior to initiating Phase II work. In addition, as is required for all Phase II proposals, the Phase II portion of the Fast-Track proposal must present a commercialization plan that addresses specific points. For more information on the Fast-Track mechanism, please contact Edward Metz.

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