Small Business Innovation Research (SBIR)

SBIR is the federal program for funding R&D at small businesses, running through Phase I (feasibility, about $250K), Phase II (prototype, about $1.7M), and Phase III (commercialization, no statutory cap). For defense aerospace it is the main pathway for new tech to enter the DoD ecosystem. Anduril, Hermeus, Shield AI, and most well-known defense-tech startups stacked Phase I and II SBIRs before raising private capital. The Phase II to Phase III transition is the chronic failure mode. Roles where this matters: Capture Management, BD, Program Management, Engineering.