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Eligibility Criteria

This information and more is detailed in the SF424 SBIR/STTR Application Guide.

Small Business Innovation Research (SBIR)

Only United States small business concerns (SBCs) are eligible to participate in the SBIR program. To be eligible, a small business must meet all of the criteria described in the current funding opportunity announcement at the time of Phase I and II awards, including:

  • Is organized for profit, with a place of business located in the United States, which operates primarily within the United States or which makes a significant contribution to the United States economy through payment of taxes or use of American products, materials, or labor;
  • Is in the legal form of an individual proprietorship, partnership, limited liability company, corporation, joint venture, association, trust, or cooperative, except that where the form is a joint venture, there must be less than 50 percent participation by foreign business entities in the joint venture;
  • (i) Is more than 50% directly owned and controlled by one or more individuals (who are citizens of or permanent resident aliens in the United States), other business concerns (each of which is more than 50% directly owned and controlled by individuals who are citizens or permanent resident aliens of the United States), or any combination of these;

    OR

    (ii) For NIH SBIR only: Is more than 50% owned by multiple venture capital operating companies, hedge funds, private equity firms, or any combination of these. No single venture capital operating company, hedge fund, or private equity firm may own more than 50% of the concern;

    OR

    (iii) Be a joint venture in which each entity to the joint venture meets the requirements above.

  • Has, including its affiliates, no more than 500 employees.

For additional guidance on eligibility, see the Small Business Administration Guide to SBIR/STTR Program Eligibility.

Definitions (NIH Only):

  • Hedge fund has the meaning given that term in section 13(h)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1851(h)(2)). The hedge fund must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.
  • Portfolio company means any company that is owned in whole or part by a venture capital operating company, hedge fund, or private equity firm.
  • Private equity firm has the meaning given the term "private equity fund" in section 13(h)(2) of the Bank Holding Company Act of 1956 (12 U.S.C. 1851(h)(2)). The private equity firm must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.
  • Venture capital operating company means an entity described in §121.103(b)(5)(i), (v), or (vi). The venture capital operating company must have a place of business located in the United States and be created or organized in the United States, or under the law of the United States or of any State.

Small Business Technology Transfer (STTR)

The Small Business Technology Transfer (STTR) Program is similar in structure to SBIR but funds cooperative research and development projects involving a small business and a research institution (i.e., non-profit college or university, federally funded research and development center (FFRDC), or domestic nonprofit research organization). The purpose of the STTR program is to create an effective vehicle for moving ideas from our nation's research institutions to the commercial market.

To participate in the STTR Program, the small business must meet all the criteria specified in the current funding opportunity announcement at the time of Phase I and II awards, including:

  • Is organized for profit, with a place of business located in the U.S. and no more than 500 employees; there is no size limit on the research institution, but it must also be located in the U.S.;
  • Is more than 50% U.S.-owned and independently operated;

In addition, the small business must be engaged in a formal cooperative research and development effort with the research institution.

  • The effort must be managed by the small business, with a minimum of 40% of the work done by the small business and a minimum of 30% of the work done by the research institution.
  • The research institution must be a U.S. nonprofit college or university, domestic nonprofit research organization, or federally funded research and development center (FFRDC).

The principal investigator may be principally employed at either the small business or the research institution.

Updated: July 30, 2015