SBIR and STTR for defense founders: how the phases actually work
Phase I, II, and III mechanics, open versus conventional topics, how AFWERX and SpaceWERX style pipelines run, and an honest look at timelines.
Updated Sep 30, 2026Defense & Space
On this page
- Where the program stands in 2026
- The three phases
- Phase I: feasibility
- Phase II: development
- Phase III: commercialization
- Open topics versus conventional topics
- How AFWERX and SpaceWERX style pipelines run
- Defense and space programs in the directory
- FAQ
- Is SBIR funding available right now?
- Does taking SBIR or STTR money dilute my company?
- Do I need a Phase I award before I can get Phase II?
- What is the difference between SBIR and STTR again?
For defense and space founders, SBIR and STTRUS federal programs that fund small-company R&D with non-dilutive awards in phases. are often the first real money, and it is non-dilutiveMoney that does not take equity, such as grants, prizes, or credits. Your ownership is untouched., so it does not touch your cap table. The programs are powerful and slow, generous and bureaucratic. This guide explains the phases, the two kinds of topics, and how the well-known pipelines run, without pretending the timelines are faster than they are.
Where the program stands in 2026
SBIR and STTR authority expired after September 30, 2025, and was restored when S. 3971 became Public Law 119-83 on April 13, 2026. The law extends both programs through September 30, 2031, as the SBA's announcement also states. Two changes matter to founders:
- A new Strategic Breakthrough Phase II award of up to 30 million dollars over up to 48 months. It is for companies that already hold at least one prior Phase II award, and it requires matching funds at least equal to the award, one to one.
- Proposal caps. Starting in fiscal 2027, each agency must set a maximum number of proposals per company. The Department of the Air Force has said it will allow one proposal per topic. Pick your topics deliberately rather than spreading near-identical proposals across a release.
The three phases
SBIR and STTR both run in phases. STTR works the same way but additionally requires you to partner with a research institution such as a university or federal lab.
Phase I: feasibility
A small award to prove your idea is technically feasible. Think of it as being paid to write a serious answer to a narrow question, over a few months. It is the audition, not the run.
Phase II: development
A much larger award to build and mature the technology, usually over a couple of years. Most of the real money and real work lives here. You generally need a Phase I result, or a direct-to-Phase-II path where it exists, to get here.
Phase III: commercialization
The phase that uses non-program money. The government does not fund Phase III through SBIR itself. Instead, Phase III is the transition to a real contract or a commercial customer, funded from other budgets. This is where the earlier work is supposed to pay off.
These are illustrative ranges to show the shape of the funnel, not any specific program's current numbers. Actual amounts and durations are set by each agency's solicitation and change over time, so always read the live solicitation.
| Phase | What it funds | Rough shape |
|---|---|---|
| Phase I | Feasibility study | Tens of thousands to mid six figures, over roughly 6 months |
| Phase II | Prototype and development | High six figures to low seven figures, over roughly 2 years |
| Phase III | Transition to a real contract | Funded outside SBIR, size depends on the customer |
For a dated reference point, the Air Force's Get Funded page listed Phase I awards of up to 323,000 dollars over up to six months when we checked on September 30, 2026.
The takeaway is the ratio, not the digits. Phase I is small and short. Phase II is where the weight is. Phase III is where it either becomes a business or does not.
Open topics versus conventional topics
There are two ways a solicitation frames the problem.
- A conventional topic is a specific problem the government has written down. You propose a solution to their stated need. Fit is narrow, and your proposal is judged against how well it answers that exact ask.
- An open topic lets you bring the problem. You propose both the need and your solution, and argue that a part of the government would want it. Fit is broader, but you carry the burden of showing there is a real customer.
Open topics widened the door for dual-use startups, because a company built for a commercial market can enter without contorting itself to a pre-written requirement.
The Air Force pipeline is changing shape here. In April 2026, AFWERX said it and SpaceWERX are transitioning to a focused open topic model, which replaces traditional open topics with mission-driven subject areas that still allow a range of solutions. Current Air Force and Space Force releases are labeled specific topics. The distinction above still helps you read any solicitation, but expect Air Force topics to name the mission area even when they leave the solution open.
How AFWERX and SpaceWERX style pipelines run
Organizations like AFWERX and SpaceWERX run SBIR and STTR solicitations with a startup-facing front door: open calls, pitch events, and a path toward follow-on work. Mechanically, the flow looks like this.
- A solicitation opens for a window. You submit a proposal against it.
- Selected teams receive a Phase I award and do the feasibility work.
- Strong Phase I results can compete for Phase II, sometimes with matching funds from a government customer who wants the capability.
- If a real user adopts it, the work transitions toward Phase III and a contract of record.
Defense and space programs in the directory
These are the verified defense and space programs we currently list. Terms, windows, and confidence badges are live, and each links to its full page.
Showing 13 of 13 programs
| Check size | Equity | Terms | Format | Next window | Signal | |||
|---|---|---|---|---|---|---|---|---|
| AFWERX SBIR/STTR (formerly Open Topic)dual-use defense technology (Air Force) | Phase I: up to $323,000 (up to six months); Phase II: up to $2.1 million; TACFI: $375,000 to $2 million; STRATFI: $3 million to $15 million in SBIR/STTR funds; Strategic Breakthrough: up to $30 million with a 1:1 match | Not publishedNot an equity accelerator: AFWERX manages the Department of the Air Force's SBIR and STTR programs, which award non-dilutive contracts. Per the AFWERX Get Funded page (September 28, 2026): Phase I runs up to six months and pays up to $323,000; Phase II runs up to 24 months and pays up to $2.1 million, and companies with a mature solution, an identified DAF customer and end user, and a signed Customer Memorandum can apply directly to Phase II (D2P2). Sequential funding for companies with a current or recent Phase II: TACFI $375,000 to $2 million with 1:1 cost sharing (up to 24 months); STRATFI $3 million to $15 million in SBIR/STTR funding, matched by $6 million to $45 million in government or private investment (up to 48 months); Strategic Breakthrough, a federal award of up to $30 million with a required 1:1 match (up to 48 months). investment_amount states STRATFI as the SBIR/STTR-funded portion, the same convention as the spacewerx record. equity_pct null because government contracts take no equity. City/state null: AFWERX works from several locations and proposals are submitted online through DSIP. | Non-dilutive | Not published | Remote | Oct 21, 2026 | Oct 1, 2026 | Verified |
| Army xTech Prize CompetitionsArmy technology (prize competitions) | Not publishedNon-dilutive prize competition series: Phase 1 white paper, Phase 2 pitch or demonstration events, with cash prizes plus potential follow-on Army contracts (incl. SBIR pathways), mentorship and networking. Prize pools vary per competition. xTech Apex Intercept (low-cost interceptors) offers up to $8,000,000 total: up to 30 Phase 1 finalists at $25,000 each and up to 18 Phase 2 winners sharing $7.25M across four topic areas (per the Apex Intercept competition page, July 2026). Eligibility spans small, medium and large businesses from the US and allied countries. | Not publishedNon-dilutive prize competition series: Phase 1 white paper, Phase 2 pitch or demonstration events, with cash prizes plus potential follow-on Army contracts (incl. SBIR pathways), mentorship and networking. Prize pools vary per competition. xTech Apex Intercept (low-cost interceptors) offers up to $8,000,000 total: up to 30 Phase 1 finalists at $25,000 each and up to 18 Phase 2 winners sharing $7.25M across four topic areas (per the Apex Intercept competition page, July 2026). Eligibility spans small, medium and large businesses from the US and allied countries. | Non-dilutive | Not published | Remote | Oct 19, 2026 | Oct 1, 2026 | Verified |
| Capital Factory (Defense)dual-use defense tech (Texas) | Not publishedTexas startup hub and venture firm whose Texas Fund lists defense among the frontier areas it backs (autonomy, robotics, space, defense, neurotech, energy); defense portfolio includes Saronic Technologies, X-Bow Systems, Red 6, Allen Control Systems, and Apptronik. Startups engage via the Texas Fund (cash investments from seed through Series C; 'pitch us, no warm intro needed') and the All Access membership, not a fixed-terms cohort, so amounts and equity are null (not published). The Government and Defense page (capitalfactory.com/government) features the Center for Dual-Use Innovation (CDI), which opened at Capital Factory in 2019 as the Center for Defense Innovation and was renamed in 2024, plus the Fed Supernova conference, the Dual-Use Academy, and STATION DC in Washington, DC. | Not publishedTexas startup hub and venture firm whose Texas Fund lists defense among the frontier areas it backs (autonomy, robotics, space, defense, neurotech, energy); defense portfolio includes Saronic Technologies, X-Bow Systems, Red 6, Allen Control Systems, and Apptronik. Startups engage via the Texas Fund (cash investments from seed through Series C; 'pitch us, no warm intro needed') and the All Access membership, not a fixed-terms cohort, so amounts and equity are null (not published). The Government and Defense page (capitalfactory.com/government) features the Center for Dual-Use Innovation (CDI), which opened at Capital Factory in 2019 as the Center for Defense Innovation and was renamed in 2024, plus the Fed Supernova conference, the Dual-Use Academy, and STATION DC in Washington, DC. | Mixed | TX | Hybrid | None confirmed | Oct 1, 2026 | Verified |
| Catalyst Accelerator (Catalyst Space Accelerator)space and national-security tech for U.S. Space Force | Not publishedDefense customer-discovery accelerator connecting startups with DoD/Space Force stakeholders (Space Delta 7 AI/ML 'CAAMO' cohort and BMC3I TAP Lab Cohort 4 ran in Spring 2026); 6-week Stage 1 cohort experience. The site does not publish stipend/investment figures or equity terms, so those are null; historically cohorts have been non-dilutive with no equity taken. BMC3I TAP Lab Phase 1 applications, opened at the July 21 to 23, 2026 Mission Catalyst Summit, are now closed. New in Fall 2026: an Investment Readiness Boot Camp (CAIRB; customer AFRL) for pre-Series A space-technology companies with no more than $5M in investment, not focused on government customer discovery; applications ran August 20 to September 16, 2026, the boot camp runs October 12 to 23, 2026 in Colorado Springs, and lodging is provided for 11 nights per company. No next application window was posted as of 2026-09-28. | Not publishedDefense customer-discovery accelerator connecting startups with DoD/Space Force stakeholders (Space Delta 7 AI/ML 'CAAMO' cohort and BMC3I TAP Lab Cohort 4 ran in Spring 2026); 6-week Stage 1 cohort experience. The site does not publish stipend/investment figures or equity terms, so those are null; historically cohorts have been non-dilutive with no equity taken. BMC3I TAP Lab Phase 1 applications, opened at the July 21 to 23, 2026 Mission Catalyst Summit, are now closed. New in Fall 2026: an Investment Readiness Boot Camp (CAIRB; customer AFRL) for pre-Series A space-technology companies with no more than $5M in investment, not focused on government customer discovery; applications ran August 20 to September 16, 2026, the boot camp runs October 12 to 23, 2026 in Colorado Springs, and lodging is provided for 11 nights per company. No next application window was posted as of 2026-09-28. | Non-dilutive | CO | Hybrid | None confirmed | Oct 1, 2026 | Verified |
| FedTech (Startup Studios & Accelerators)deep tech from federal labs / defense | Not publishedFedTech describes itself as 'a fully integrated, equity-free deep tech commercialization platform' (site footer). It runs startup studios (pairing entrepreneurs with federal-lab technologies), accelerators for existing startups, corporate and government innovation programs, and SBIR/STTR TABA services. Program pages do not publish stipend or investment figures, so amounts are null; many programs are government or corporate sponsored. The Navy-backed Crucible Accelerator (led by the Inland Empire Tech Bridge, powered by FedTech) is virtual, 8 weeks, 12 companies per cohort (Fall and Spring), with no equity and no fees; its Fall 2026 applications closed August 31, 2026 and the cohort runs October to December 2026. Headquartered at 4401 Wilson Blvd, Arlington, VA. | Not publishedFedTech describes itself as 'a fully integrated, equity-free deep tech commercialization platform' (site footer). It runs startup studios (pairing entrepreneurs with federal-lab technologies), accelerators for existing startups, corporate and government innovation programs, and SBIR/STTR TABA services. Program pages do not publish stipend or investment figures, so amounts are null; many programs are government or corporate sponsored. The Navy-backed Crucible Accelerator (led by the Inland Empire Tech Bridge, powered by FedTech) is virtual, 8 weeks, 12 companies per cohort (Fall and Spring), with no equity and no fees; its Fall 2026 applications closed August 31, 2026 and the cohort runs October to December 2026. Headquartered at 4401 Wilson Blvd, Arlington, VA. | Equity-free | VA | Hybrid | None confirmed | Oct 1, 2026 | Verified |
| HUSTLE Defense Accelerator (Griffiss Institute)dual-use and defense technology (Air Force problem sets) | SAFE funding awarded at pitch day: Cohort 5 awards ranged from $45,000 to $155,000 from a $550,000 pool | Not publishedDefense tech accelerator run by the Griffiss Institute in Rome, New York, sponsored by the Air Force Research Laboratory, Empire State Development and National Grid, for pre-seed and seed startups with dual-use technology. Cohorts are organized around a posted problem set. Participants sign a SAFE with the Griffiss Institute under which $24,500 of in-kind programming, $7,500 per founder (up to $15,000) and any prize money won convert into equity; the valuation terms are in the SAFE, not on the page. Cohort 5 was an eight-week program starting in March 2026 with five startups; on April 30, 2026 it awarded $550,000 in SAFE funding, from $45,000 to $155,000 per company, and funded companies must show at least one year of corporate residency in New York State. Nationality, citizenship and residency restrictions can apply depending on each cohort's funding source. No next cohort has been posted. | Equity for cash | NY | Not published | None confirmed | Oct 1, 2026 | Verified |
| Hyperspace Challengespace technology for USSF/AFRL | Not publishedGovernment-customer discovery accelerator, not an investment program: 2025 Fall Challenge page states 'There is NO promise of funding of any sort as a result of participating.' Selected 2025 companies received one-on-one consulting (the linked 2025 page lists 14 hours of consultation; an older version of the page said 6 to 10 hours) plus access to government customers; earlier editions (e.g., 2021) offered up to $100k in cash prizes. Investment/equity null accordingly. 2025 cycle: applications closed 2025-09-16, Accelerator Week 2025-11-05/06. As of 2026-09-28 no 2026 cycle has been announced and the site focuses on networking events, webinars and training, so next_deadline null. | Not publishedGovernment-customer discovery accelerator, not an investment program: 2025 Fall Challenge page states 'There is NO promise of funding of any sort as a result of participating.' Selected 2025 companies received one-on-one consulting (the linked 2025 page lists 14 hours of consultation; an older version of the page said 6 to 10 hours) plus access to government customers; earlier editions (e.g., 2021) offered up to $100k in cash prizes. Investment/equity null accordingly. 2025 cycle: applications closed 2025-09-16, Accelerator Week 2025-11-05/06. As of 2026-09-28 no 2026 cycle has been announced and the site focuses on networking events, webinars and training, so next_deadline null. | Non-dilutive | NM | Hybrid | None confirmed | Oct 1, 2026 | VerifiedPossibly dormantWe could not confirm a recent or upcoming cohort. It may have paused or wound down. Verify before applying. |
| IAI CATALYST (powered by Starburst)aerospace, defense and dual-use technology | $100,000 cash investment (optional, structured as a SAFE) plus $100,000 in in-kind technical support | Not publishedTwenty-week hybrid accelerator run by IAI North America, the U.S. arm of Israel Aerospace Industries, and powered by Starburst, for U.S. pre-seed and seed startups and mature research projects in aerospace and dual-use technology. Selected companies can take a $100,000 cash investment structured as a SAFE in exchange for equity, plus $100,000 of in-kind technical support, with the aim of a pilot project with IAI. There is no participation fee. About two of the twenty weeks are in person (a kickoff week and a Demo Day in Washington, DC), and participants can use IAI North America's innovation center in Herndon, Virginia. Cohort 5 took applications March 15 to June 7, 2026 and kicked off September 23, 2026, with Demo Day on March 9, 2027. The program site says IAI CATALYST accepts applications on a rolling basis throughout the year, with a review cycle and deadline for each cohort; Cohort 6 applications are open and no close date is printed. The program also appears in the Starburst Aerospace record's list of Starburst-run programs; it has its own application, so it has its own record. | Equity for cash | VA | Hybrid | None confirmed | Oct 1, 2026 | Verified |
| NSIN (National Security Innovation Network)national security venture/talent programs | Not publishedDoD program office (formerly MD5) under DIU running collaboration and acceleration programs (Hacking for Defense, boot camps, venture programs) with non-dilutive support. No investment amounts published. Current programming could not be verified: as of 2026-09-28 the nsin.mil domain no longer resolves (no DNS record), so the website and application links are removed (the URLs stay in sources); the NSIN Forge page on partner FedTech's site shows registration closed; and no cohort announcements after the 2024 DIU restructuring were found, so status is possibly_inactive pending confirmation. | Not publishedDoD program office (formerly MD5) under DIU running collaboration and acceleration programs (Hacking for Defense, boot camps, venture programs) with non-dilutive support. No investment amounts published. Current programming could not be verified: as of 2026-09-28 the nsin.mil domain no longer resolves (no DNS record), so the website and application links are removed (the URLs stay in sources); the NSIN Forge page on partner FedTech's site shows registration closed; and no cohort announcements after the 2024 DIU restructuring were found, so status is possibly_inactive pending confirmation. | Non-dilutive | VA | Hybrid | None confirmed | Sep 28, 2026 | Secondary sourcePossibly dormantWe could not confirm a recent or upcoming cohort. It may have paused or wound down. Verify before applying. |
| SOFWERXspecial operations technology | Not publishedNot a cohort accelerator: an innovation platform connecting companies to USSOCOM via Tech Tuesday pitch slots (20-minute virtual briefings to government stakeholders; new submissions paused since September 18, 2026), assessment/technical experimentation events, tech sprints, RFIs, and SBIR opportunities that can lead to government contracts. No equity taken and no fixed award amount, hence nulls. Deadlines vary by event and SBIR release (USSOCOM SBIR 26.BZ Release 6 closes October 21, 2026 at noon ET), so next_deadline is null. | Not publishedNot a cohort accelerator: an innovation platform connecting companies to USSOCOM via Tech Tuesday pitch slots (20-minute virtual briefings to government stakeholders; new submissions paused since September 18, 2026), assessment/technical experimentation events, tech sprints, RFIs, and SBIR opportunities that can lead to government contracts. No equity taken and no fixed award amount, hence nulls. Deadlines vary by event and SBIR release (USSOCOM SBIR 26.BZ Release 6 closes October 21, 2026 at noon ET), so next_deadline is null. | Non-dilutive | FL | Hybrid | Oct 21, 2026 | Oct 1, 2026 | Verified |
| SpaceWERX (SBIR/STTR, STRATFI/TACFI, Accelerate)space technology for the U.S. Space Force | Phase I: $75K to $180K; Phase II (incl. D2P2): $1.25M to $1.8M; TACFI: $375K to $2M; STRATFI: $3M to $15M in SBIR/STTR funds, matched by outside funds (per the SpaceWERX and AFWERX Get Funded pages, September 2026) | Not publishedInnovation arm of the U.S. Space Force; funds companies through non-dilutive SBIR/STTR contracts (Spark, Ventures, and Accelerate branches, incl. cohorts and STRATFI/TACFI scale-up funding); equity null because contracts take no equity. STRATFI convention: investment_amount gives the SBIR/STTR-funded portion ($3M to $15M, per the AFWERX Get Funded page, which adds that it is matched by $6M to $45M in government or private investment), the same convention as the afwerx-open-topic record; the SpaceWERX Get Funded page itself lists STRATFI as $6M to $45M. Space PY26.2 TACFI accepts submissions on a continuous, rolling basis. | Non-dilutive | Not published | Remote | Oct 21, 2026 | Oct 1, 2026 | Verified |
| Starburst Aerospace Acceleratoraerospace and defense | Not publishedRuns 20+ partner accelerator programs worldwide (US programs include ICDA in San Marcos TX, IAI CATALYST and the Starburst National Landing Launchpad in Virginia, the NASA Space Health Accelerator, SEISMIC MSI Defense Technology Accelerator, the SATE Accelerator in Washington, and SCALE in Los Angeles with UCLA) alongside a venture investment arm and consulting business. Terms vary by program and are mostly unpublished, so amounts and equity are null. Published examples: the SCALE FAQ says the program is completely free with no cash or equity charge (Department of Commerce funded, 13 weeks, two cohorts per year, pre-seed and seed, TRL 3+, Southern California presence required), though SCALE's page still shows its 2023 Cohort 5 as the latest; IAI CATALYST, run by IAI North America and powered by Starburst for US-based early-stage startups, offers a $100K cash investment plus $100K in in-kind technical support over 20 weeks, and its Cohort 5 took applications March 15 to June 7, 2026 and kicked off September 23, 2026 (demo day March 9, 2027). The IAI CATALYST site shows a countdown for Cohort 6 applications but prints no close date. | Not publishedRuns 20+ partner accelerator programs worldwide (US programs include ICDA in San Marcos TX, IAI CATALYST and the Starburst National Landing Launchpad in Virginia, the NASA Space Health Accelerator, SEISMIC MSI Defense Technology Accelerator, the SATE Accelerator in Washington, and SCALE in Los Angeles with UCLA) alongside a venture investment arm and consulting business. Terms vary by program and are mostly unpublished, so amounts and equity are null. Published examples: the SCALE FAQ says the program is completely free with no cash or equity charge (Department of Commerce funded, 13 weeks, two cohorts per year, pre-seed and seed, TRL 3+, Southern California presence required), though SCALE's page still shows its 2023 Cohort 5 as the latest; IAI CATALYST, run by IAI North America and powered by Starburst for US-based early-stage startups, offers a $100K cash investment plus $100K in in-kind technical support over 20 weeks, and its Cohort 5 took applications March 15 to June 7, 2026 and kicked off September 23, 2026 (demo day March 9, 2027). The IAI CATALYST site shows a countdown for Cohort 6 applications but prints no close date. | Mixed | CA | Hybrid | None confirmed | Oct 1, 2026 | Verified |
| Techstars Space Acceleratorspace technology | $220,000 total: $20,000 via convertible equity agreement plus $200,000 uncapped MFN SAFE | 5% | Equity for cash | CA | In person | None confirmed | Oct 1, 2026 | Verified |
Live from the directory. See the full Defense & Space listing.
FAQ
Is SBIR funding available right now?
Yes. Congress reauthorized SBIR and STTR through September 30, 2031, and agencies open solicitations in periodic releases, each with its own open and close dates. Our defense and space deadlines page lists the current windows for the programs we track.
Does taking SBIR or STTR money dilute my company?
No. Both are non-dilutive, so they do not take equity. The cost is in reporting, compliance, and the calendar, not ownership.
Do I need a Phase I award before I can get Phase II?
Usually yes, though some agencies offer a direct-to-Phase-II route for technologies that can show prior maturity. Read the specific solicitation, because the rules differ by agency.
What is the difference between SBIR and STTR again?
They are structured the same way in phases. STTR additionally requires a formal partnership with a research institution and sets a minimum share of the work for that partner.
This is general education, not legal or investment advice. Read the actual documents and talk to a lawyer before you sign.
Programs mentioned in this guide
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