The Small Business Innovation Research (SBIR) program expired at the end of September due to a disagreement between Senator Ernst (R-IA) and Senator Markey (D-MA), the chair and ranking member of the U.S. Senate Committee on Small Business and Entrepreneurship. They disagree about the status of “SBIR mills” within the U.S. Department of Defense, companies that receive the majority of their contracting revenue from SBIR awards, with limited commercialization. Senator Ernst believes they should be removed from the program; Senator Markey believes they play an important role in the innovation ecosystem. But while this debate plays out, future innovation suffers.
The SBIR program, established in 1982, is a powerful tool for the federal government to commercialize scientific research—turning theoretical ideas into technologies that can help millions of people and boost economic growth. Major companies that received SBIR funding when they started include Qualcomm, ViaSat, and Ginkgo Bioworks. These companies found commercial needs for products that fulfilled government needs.
With the SBIR program currently unauthorized, this innovation pipeline is dead. In 2024, $4.3 billion was spent on SBIR awards. That is billions of dollars that founders and academics who want to turn their research into useful technologies now cannot access. The end of the SBIR program is bad for American technical competitiveness. For example, the Air Force has used SBIR awards in recent years to fund the development of technologies such as Synthetic-aperture radar, hypersonics, and autonomous satellite docking operations.
