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SBIR & STTR Small Business Grants 2022: An Overview

Updated: Feb 15, 2023

Want free grant? It’s possible! If you are looking for alternative, non-dilutive funding opportunities for your science or tech start-up that doesn’t include business start-up loans, consider SBIR and STTR small business grants from SBA.gov.


Here’s an overview of SBIR and STTR grants and how they can help a start-up Founder like you.

What are SBIR and STTR Grants?


Small Business Innovation Research grants (SBIR) and Small Business Technology Transfer grants (STTR) are federal programs managed by the U.S. Small Business Administration.


They are designed to give science and tech industry startups the much-needed funding to bring innovative technologies to market.


Simply put: the government invests in your idea so you can take it from idea to reality.


SBIR vs. STTR: What’s the Difference?


So what’s the difference between the SBIR and STTR programs? There are three main differences you should know.


First, for an SBIR grant, the start-up typically manages and leads the majority of the intended research. With an STTR grant, the start-up collaborates with a non-profit research institution, like a university, lab, or hospital.


Second, with the STTR program, the technology is often developed jointly, then transferred from the partner non-profit research institution to the start-up for them to bring it to market.


Finally, up to 60% of the research efforts can be subcontracted in an STTR to the non-profit research institution. With an SBIR grant, this limit is set to 33% for a Phase I application and 50% for Phase II.


Who Should Apply for SBIR/STTR Grants


There are some eligibility requirements for SBIR and STTR grants that Founders should keep in mind when deciding which SBA grant opportunity would be the most appropriate for them.


A few of the requirements include being a for-profit company in the U.S., qualifying as a Small Business Concern (SBC), and meeting the size requirement. The Small Business Administration has created a compliance guide for your convenience.


In general, if you are a small business in the science, tech, engineering, medicine, or energy industries and you have an innovative idea that could revolutionize the commercial market, it is worth seeing if you meet the requirements to apply.


Benefits of an SBIR/STTR Grant


There are several benefits to SBIR/STTR grants versus other traditional small business funding opportunities. Here are the top two:


Up To $2 Million in Funding


Start-ups can receive anywhere from $50,000 to $2 million from these federal programs. Many innovative ideas take a large amount of funding to execute the research and development required to bring them to market.


Non-dilutive


Additionally, unlike traditional funding with investors or venture capitalists who are looking for an equity stake in your company, SBIR/STTR grants are non-dilutive, meaning you do not need to give away any equity in your company in the process.


Some could say that these federal grants are essentially free money!


Downsides of SBIR/STTR Grants


Of course, like with all things that seem too good to be true, there are a couple of downsides.


Competitive


Federal grant programs for start-up funding, like the SBIR and STTR programs, are HIGHLY COMPETITIVE. In fact, it is estimated that less than 10% of applications actually receives an SBIR/STTR funding award. This means that you have to have a strong application to have a chance at getting awarded.


Detailed & Overwhelming


The applications themselves are also 50-100 pages or longer requiring attention to each, and every little details. SBIR and STTR grant applications are also long and the instructions can be quite confusing. There are also a lot of federal registrations and other requirements to keep in mind just to submit an application for review. Nevertheless to be a competitive applicant, you’ll have to navigate the intricacies of stellar grant writing, too. It can be quite confusing, especially for those applying for the first time.


How To Apply for SBIR/STTR Grants


To apply for SBIR or STTR grant opportunities, first ensure you are eligible using the links we provided above. Then, you’ll need to search for a participating agency here on a related topic to your innovative idea. Each opportunity will give you further application instructions, so you’ll have to follow the specifics from there.


Get Help From KeepYourEquity.Co


The average business owner will spend a lot of time and frustration trying to secure these small business grants. Instead, you should know about another option to increase your odds of success and save you time and frustration in the meantime!


KeepYourEquity.co is on a mission to support scientists, engineers, and clinicians throughout their start-up journeys. Our expert grant-writing consultants work with Founders in the U.S. to craft high-quality, strong SBIR and STTR applications.


As former Founders and executives ourselves, the KeepYourEquity.co team will help you bring novel ideas from research & development (R&D) to the market. Whether you are just getting started, or are stuck somewhere along the way, KeepYourEquity.co is here to ensure you reach your goals.

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