NSF SBIR Grants March 2025 Update

As of March 2025, the National Science Foundation's (NSF) Small Business Innovation Research (SBIR) program continues to play a pivotal role in fostering innovation among U.S.-based startups and small businesses. Recent developments have further enhanced the program's impact and accessibility.

Increased Funding Levels

In June 2024, the NSF announced significant increases in funding amounts for its SBIR and Small Business Technology Transfer (STTR) programs. The maximum funding for Phase I awards rose to $305,000, while Phase II awards increased to $1,250,000. This escalation allows small businesses to access approximately $2 million to develop prototypes and commercialize their technologies.

Introduction of the Fast-Track Pilot Program

To expedite the transition from concept to commercialization, the NSF introduced the SBIR/STTR Fast-Track Pilot program. This initiative enables companies with NSF lineage to submit a single proposal covering both Phase I and Phase II funding, potentially securing up to $1,555,000 in non-dilutive funding. The program aims to streamline the funding process and reduce the time between phases. 

Adjustments to Indirect Cost Rates

Effective October 1, 2024, the NSF implemented changes to indirect cost rates for SBIR/STTR solicitations. The de minimis indirect cost rate increased from 10% to 15%, and the Modified Total Direct Cost (MTDC) threshold for subawards rose from $25,000 to $50,000. These adjustments align with updates to the Federal Government’s Uniform Guidance, providing small businesses with greater flexibility in budgeting for indirect costs. 

Ongoing Support Amid Executive Orders

The NSF has reaffirmed its commitment to supporting small businesses despite recent executive orders affecting federal funding. Proposal processing and review activities have resumed, and SBIR project pitches continue to be reviewed without interruption. The NSF is updating funding opportunities and submission dates as necessary to comply with new directives. 

Success Stories Highlight Program Impact

NSF-funded companies continue to make headlines with groundbreaking innovations. For instance, a collaboration between DeepSeq.AI and a University at Albany professor secured a $275,000 Phase I SBIR grant to advance AI-driven drug discovery research. Such partnerships exemplify the program's role in fostering cutting-edge technological advancements. 

In summary, the NSF's SBIR program remains a cornerstone of support for small businesses aiming to bring innovative technologies to market. With increased funding, streamlined processes, and unwavering support, the program continues to adapt to the evolving needs of the entrepreneurial ecosystem.

Bibliography

National Science Foundation. “NSF Boosts Funding Amounts for SBIR/STTR Entrepreneurship and Innovation.” NSF, June 2024. https://www.nsf.gov/tip/updates/nsf-boosts-funding-amounts-sbirsttr-entrepeneurship-innovation

National Science Foundation Seed Fund. “Fast-Track Pilot Program.” NSF, 2024. https://seedfund.nsf.gov/how-to-submit/fast-track

National Science Foundation Seed Fund. “Adjustments to Indirect Cost Rates.” NSF, October 1, 2024. https://seedfund.nsf.gov/assets/files/applicants/indirect-cost-rate-adjustments.pdf

National Science Foundation. “Executive Orders and Their Impact on NSF Funding.” NSF, 2025. https://www.nsf.gov/executive-orders

Karlin, Rick. “UAlbany Professor Works with AI Firm on Drug Discovery.” Times Union, March 2025. https://www.timesunion.com/business/article/ualbany-professor-works-ai-firm-drug-discovery-19975126.php

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