Programs and Phases

The federal small business research programs, their phases, and the faster routes some agencies offer.

• AFWERX STRATFI and TACFIDepartment of the Air Force SBIR/STTR programs run by AFWERX that add matched funding to Phase II efforts to help move them toward Phase III and fielded use.
• Direct to Phase II (D2P2)A Phase II SBIR award made to a small business that did not receive a Phase I award for that project, because it has already shown feasibility by other means.
• NIH Fast-TrackAn NIH application option in which a small business submits Phase I and Phase II together in one application, reviewed together, to shorten or remove the funding gap between phases.
• NSF Project PitchA short online summary a company must submit to NSF's SBIR/STTR program, and have accepted, before NSF will invite it to submit a full Phase I proposal.
• Phase IThe first SBIR/STTR award stage, which funds a short project to test the technical merit or feasibility of an idea or technology before larger development funding.
• Phase IIThe second SBIR/STTR award stage, which continues the research and development begun in Phase I, funded according to Phase I results, technical merit and commercial potential.
• Phase IIIWork that derives from, extends, or completes an earlier SBIR/STTR Phase I or II effort but is paid for with non-SBIR/STTR money, typically commercial sales or follow-on government contracts.
• SBIR (Small Business Innovation Research)A federal program in which participating agencies give competitive, non-dilutive awards to US small businesses for research and development that has the potential for commercialization.
• Strategic Breakthrough AwardA large, milestone-based Phase II award created by S. 3971 (April 2026) for companies with a prior Phase II, requiring matching funds, meant to carry proven technology toward production and Phase III.
• STTR (Small Business Technology Transfer)A federal program like SBIR that funds small business research and development, but requires the small business to formally partner with a US non-profit research institution such as a university.