Senator Edward J. Markey (D-Mass.) recently unveiled the SBIR/STTR Reauthorization Act of 2025, legislation designed to permanently authorize and expand the Small Business Innovation Research Program (SBIR) and the Small Business Technology Transfer Program (STTR). This timely initiative, supported by House Committee on Small Business Ranking Member Nydia Velázquez (NY-07), aims to bolster American innovation by providing small businesses with assured access to critical research funding.
For over four decades, SBIR and STTR programs have injected more than $70 billion into the hands of more than 30,000 small businesses nationwide, driving technological advancements that not only enhance public welfare but also enhance national security. However, both programs face expiration on September 30, 2025, if Congress does not act.
"Thanks in part to the SBIR/STTR programs, America has experienced a ‘golden age of innovation.’ As current policies threaten the backbone of our most innovative small businesses, it’s crucial that we make these programs permanent," Markey emphasized. He reiterated the importance of prioritizing merit and fostering competition, ensuring that truly small businesses remain at the forefront of innovation.
These sentiments were echoed by Velázquez, who remarked, “At a time when vital public programs are under threat, it is crucial to protect those that yield success. This bill will expand access and provide necessary stability."
The proposed legislation includes several significant enhancements aimed at maximizing the effectiveness and reach of the SBIR and STTR programs:
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Permanence: By permanently authorizing these programs, small businesses gain a reliable funding source that enables sustained collaboration with government agencies for continued innovation.
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Merit-Based Competition: The act preserves the longstanding practice of merit-based competition for funding, eliminating any limits on the number of awards or businesses eligible for support—an essential measure to encourage unbridled innovation.
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Increased Funding: Agencies would need to allocate a minimum of 7% of their extramural R&D budgets to SBIR and 1% to STTR over seven years, significantly enhancing financial support from current levels.
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Commercialization Support: To enhance practical implementation, agencies would have to appoint a Technology Commercialization Official and receive training to better identify and support technologies with commercialization potential.
- Broadening Participation: By reauthorizing the Federal and State Technology Partnership (FAST) Program, the bill aims to lessen the hurdles that small businesses, especially underrepresented ones, face in crafting competitive proposals. It allows agencies to designate SBIR/STTR funding for mentorship opportunities targeting women and economically disadvantaged individuals.
Massachusetts, a leader in securing SBIR and STTR funding, exemplifies the benefits of these programs. The state has received over $8.3 billion in SBIR awards and $720 million in STTR awards, highlighting the immense potential for small businesses nationwide.
Jere Glover, Executive Director of the Small Business Technology Council (SBTC), applauded the act’s focus on permanence and funding increases. “Small businesses thrive on certainty, and making these programs permanent sends a powerful message about government commitment,” he stated.
Brian Johnson, President of MassMEDIC, underscored the critical role SBIR grants play in the medical technology sector. He noted, "As private investment shifts to quicker-return sectors, SBIR grants fill a vital gap in early-stage capital for healthcare innovation."
While the legislation offers numerous advantages, small business owners should consider potential challenges as well. The application process for SBIR and STTR funding may require extensive time and resources, especially for startups with limited experience in securing government grants. Simplifying this process will be essential for inclusivity, ensuring that businesses from underserved regions can effectively access funding opportunities.
The proposed reauthorization act also positions the federal government as a proactive partner in fostering innovative ventures, a sentiment echoed by Phil Weilerstein, President and CEO of VentureWell. He noted that while SBIR and STTR funds are crucial, they must be part of a broader support structure to bridge the gap between research and commercialization.
As small business owners navigate the evolving landscape of innovation and funding, the SBIR/STTR Reauthorization Act of 2025 presents a crucial opportunity to secure the financial resources and institutional support vital for sustained growth. The endorsement of numerous stakeholders reinforces the importance of these initiatives, paving the way for a brighter future for small businesses in America. More details about the bill and its implications can be found in the original press release here.
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