NSF SBIR/STTR (America's Seed Fund)

NSF SBIR Phase II

Funds United States deep-tech startups extending proven early projects into substantial technology development.

NSF SBIR Phase II is the National Science Foundation's development-stage funding mechanism for small businesses that have successfully completed an NSF SBIR Phase I award. Operating under solicitation NSF24-580, it provides up to $1,250,000 over 24 months to fund prototype refinement, scale-up R&D, manufacturing process development, or pilot validation for a deep-technology project already validated at Phase I. The base award sits within a $500,000–$1,250,000 range (median approximately $1,100,000), and NSF makes available supplemental funding options that can add more than $500,000 on top of the base, taking cumulative Phase II funding past $2 million. NSF distributes more than $200 million per year across roughly 400 startups through its SBIR and STTR programs combined.

Eligibility is limited to U.S.-based small business concerns with 500 or fewer employees (including affiliates), majority U.S. ownership, and a principal investigator whose primary employment (at least 51%) is with the company at the time of award. Critically, NSF excludes companies majority-owned by venture capital operating companies, hedge funds, or private equity firms — a restriction that sets NSF apart from NIH SBIR. Only for-profit entities qualify; non-profits, universities, and research organizations are ineligible as lead applicants. The Phase II award requires a minimum of three and up to five letters of support from potential customers or end users. All R&D must be performed within the United States, and submissions go through Research.gov, not Grants.gov.

Phase II proposals are submitted by invitation only, within an 18-month window following Phase I completion. The process begins with a three-page Project Pitch on NSF's portal; a Program Officer must issue a formal invitation before a full proposal can be submitted. NSF runs three submission deadlines per year, and no organization may submit more than one Project Pitch or proposal per deadline window. Eligible cost categories include salaries, fringe benefits, materials, and supplies; IP prosecution, marketing, and business development costs are explicitly excluded. Phase II includes a built-in allocation of up to $50,000 for Technical and Business Assistance (TABA). TRL window for Phase II entrants is 4 to 7. The award carries zero equity dilution — NSF holds no ownership stake in funded companies.