Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR)
The Small Business Administration works with 11 federal agencies through the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs to support the development of technology and commercialization applications. The program is designed to encourage private sector innovation in fields that the federal government has a unique interest in advancing, including defense, homeland security, as well as health care solutions.1 The federal government retains no ownership or equity stake in companies awarded federal support, and small businesses are free to apply for patents and enter the marketplace for any innovations that emerge during the award period.
Agencies that participate in SBIR and STTR have conducted numerous economic impact studies of the program – all of which found that that federal investment led to a significant return on investment, fostered entrepreneurship and innovation that later strengthened national defense and readiness, and global competitiveness, and supported good paying jobs across the country.
- From 1995-2018, the Department of Defense’s SBIR/STTR Program had a 22:1 return on its investment, producing $347 billion in economic activity, and supported 1,508,295 full-time jobs averaging $73,461 in annual income. 58% of Phase II SBIR/STTR contracts resulted in sales of new products and services based on innovations developed through the program’s contract, including $28 billion in sales of new products to the U.S. Military.
- From 2000-2013, the Navy’s SBIR/STTR Program fostered $44.3 billion in economic output, and supported 14,973 full-time jobs averaging $68,535 in annual income. Over 60% of Phase II SBIR/STTR contracts resulted in sales of new products and services based on innovations developed through the program’s contract.
- From 2000-2013, the Air Force’s SBIR/STTR Program fostered $47.9 billion in economic output, and supported 16,751 full-time jobs averaging $65,968 in annual income. 58% of Phase II SBIR/STTR contracts resulted in sales of new products or services based on innovations developed through the program’s contract.
- From 1998-2010, the National Cancer Institute’s SBIR/STTR Program fostered $26.1 billion in economic activity, supporting 107,918 full-time jobs and $2.9 billion in new federal, state, and local tax revenue. Over 53% of Phase II SBIR/STTR awards led to new sales, royalties, and follow-on R&D funding for the companies.
- “The Role of the SBIR and STTR Programs in Stimulating Innovation At Small High-Tech Businesses,” Hearing Before the Subcommittee on Technology and Innovation, Committee on Science and Technology House of Representatives, One Hundred Eleventh Congress, April 23, 2009. ↩︎
See Spending in Your Community
Small businesses in all 50 states benefit from federal research investments through SBIR and STTR, and businesses from Texas, Ohio, North Carolina, Massachusetts, and California, are among the top recipients of federal investment. Track SBIR/STTR awards to small businesses in your home state at America’s Seed Fund.
Download the BFRF factsheet about federal research funding and SBIR/STTR below.
1 “The Role of the SBIR and STTR Programs in Stimulating Innovation At Small High-Tech Businesses,” Hearing Before the Subcommittee on Technology and Innovation, Committee on Science and Technology House of Representatives, One Hundred Eleventh Congress, April 23, 2009.