Purchasing & Small Business

Small Business Technology Transfer (STTR) Program – Overview

The purpose of Small Business Technology Transfer (STTR) and Small Business Innovation Research (SBIR) program is to harness the innovative talents of our nation’s small technology companies for U.S. military and economic strength. STTR’s most important role is to bridge the gap between performance of basic science and commercialization of resulting innovations.

Definition: The Small Business Technology Transfer (STTR) program is a competitive federal initiative designed to foster collaboration between small businesses and nonprofit research institutions, such as universities and federal laboratories.

Small Business Technology Transfer (STTR) Program Participation

The STTR program is for US profit/no-profit small businesses located in the US with less than 500 people and 51% owned by one or more US citizens. It requires small businesses to collaborate with a research institution in Phase I and Phase II. Federal agencies with extramural research and development (R&D) budgets that exceed $1 billion are required to reserve 0.3% of the extramural research budget for STTR awards to small businesses.

Small Business Technology Transfer (STTR) Mission

The mission of the STTR program is to support scientific excellence and technological innovation through the investment of Federal research funds in critical American priorities to build a strong national economy. The programs’ goals are to:

  • Stimulate technological innovation
  • Foster technology transfer through cooperative R&D between small businesses and research institutions;
  • Increase private sector commercialization of innovations derived from federal R&D

Small Business Technology Transfer (STTR) Phases

The STTR Program is structured in three (3) phases:

  • Phase I. The objective of Phase I is to establish the technical merit, feasibility, and commercial potential of the proposed R/R&D efforts and to determine the quality of performance of the small businesses prior to providing further Federal support in Phase II. STTR Phase I awards normally do not exceed $100,000 total costs for 1 year.
  • Phase II. The objective of Phase II is to continue the R/R&D efforts initiated in Phase I. Funding is based on the results achieved in Phase I and the scientific and technical merit and commercial potential of the Phase II project proposed. Only Phase I awardees are eligible for a Phase II award. STTR Phase II awards normally do not exceed $750,000 total costs for 2 years.
  • Phase III. The objective of Phase III, where appropriate, is for the small business to pursue commercialization objectives resulting from the Phase I/II R/R&D activities. The STTR program does not fund Phase III. In some Federal agencies, Phase III may involve follow-on non-STTR funded R&D or production contracts for products, processes or services intended for use by the U.S. Government.

Difference Between Small Business Technology Transfer (STTR) and Small Business Innovative Research (SBIRS) Program

STTR differs from SBIR in three essential aspects:

  1. The SBC and its partnering institution are required to establish an intellectual property agreement detailing the allocation of intellectual property rights and rights to carry out follow-on research, development, or commercialization activities.
  2. STTR requires that the SBC perform at least 40% of the R&D and the single partnering research institution to perform at least 30% of the R&D.
  3. Unlike the SBIR program, STTR does not require the Principal Investigator to be primarily employed by the SBC.

For more information on how to apply for the SBIR or STTR visit the DoD SBIR – Small Business Innovated Research website:

AcqLinks and References:

Updated: 2/18/2024

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