The Small Business Innovation Research (or SBIR) program is a U.S. government funding program, coordinated by the Small Business Administration, intended to help certain small businesses conduct research and development (R&D). Funding takes the form of contracts or grants. The recipient projects must have the potential for commercialization and must meet specific U.S. government R&D needs.
Funds are obtained by allocating a certain percentage of the total extramural (R&D) budgets of the 11 federal agencies with extramural research budgets in excess of $100 million. Approximately $2.5 billion is awarded through this program each year. The United States Department of Defense (DoD) is the largest agency in this program with approximately $1 billion in SBIR grants annually. Over half the awards from the DoD are to firms with fewer than 25 people and a third to firms of fewer than 10. A fifth are minority or women-owned businesses. Historically a quarter of the companies receiving grants are receiving them for the first time.[1]
In April 2021, the DoD reported on a lack of due diligence for SBIR recipients, which permitted funds to go toward companies linked to the People's Liberation Army.[2] In 2022, the program was reauthorized with additional disclosure requirements for companies that have ties to "any foreign country of concern, including the People’s Republic of China.”[3]