Navy SBIR/STTR

Navy SBIR Phase II

Supports United States naval innovation teams transitioning validated concepts into stronger prototypes and mission-ready solutions.

Navy SBIR Phase II is the development and demonstration stage of the U.S. Department of the Navy's Small Business Innovation Research program, open to companies that have successfully completed Navy SBIR Phase I or that qualify for Direct-to-Phase-II on designated topics. The program funds substantial R&D resulting in prototype construction and testing, with the explicit goal of transitioning technology into Navy and Marine Corps acquisition programs. System Commands participating in Phase II include NAVAIR, NAVSEA, NAVWAR, ONR, MARCORSYSCOM, and Strategic Systems Programs, covering maritime platforms, aviation, undersea warfare, directed energy, networks, and autonomous systems.

Phase II awards are structured as cooperative agreements with a ceiling of $2,153,927 over 24 months, reflecting the SBA-wide statutory cap established in October 2024. The Navy additionally supports Sequential Phase II awards for continued work on the same project, as well as the Navy Commercialization Readiness Program (CRP) — a Phase II Enhancement track that matches SBIR funds with non-SBIR dollars from a Navy program of record or private capital, extending the period of performance and accelerating transition. The aggregate annual Phase II pool for the Navy program is approximately $280 million. Eligibility requirements mirror Phase I: U.S.-registered for-profit small businesses with 500 or fewer employees, majority U.S. ownership, all R&D performed in the United States, and the small business performing at least one-half of the Phase II work. VC-majority-owned firms are eligible per SBA Section 5107.

Phase II proposals are evaluated by merit review conducted by System Command subject-matter experts. The Navy uses a two-step competitive Phase II process. Companies should identify a Navy acquisition customer or program of record as a transition partner before the Phase II proposal is submitted, as demonstrated alignment to an acquisition pathway is a key evaluation criterion. Phase II transition into a Phase III contract can be awarded non-competitively, since the competitive selection occurred under Phase I. Solicitations and topic details are accessible through the Defense SBIR/STTR Innovation Portal (DSIP) at dodsbirsttr.mil and at navysbir.com.