How to Bid on SBIRs While the Programs’ Fate Remains Uncertain
How Startups Can Navigate SBIR Changes, Save Time, and Expand Opportunities
Founders have used the SBIR (Small Business Innovation Research) program as a non-dilutive funding source for decades. As the federal government undergoes restructuring and changing priorities, business owners rightfully wonder if they should continue to invest time, money, and labor into preparing proposals when the contracts may never be awarded.
The TL;DR/BLUFL: keep writing proposals, keep bidding, but cut your preparing time in half.
Even without the Executive Orders flying, the SBIR program is up for reauthorization in September 2025. While the program has previously received reauthorization, this vote almost always delays awards, so now is the perfect time to rethink how your startup approaches SBIR proposals.
Here’s how to significantly cut your proposal preparation time and diversify your revenue streams.
Bid More, Write Less.
The SBIR proposal process is notoriously complexity, but you can reduce the time and effort required to compile a proposal. Here’s how:
Get Ruthless About Bid/No-Bid Decisions
Not every solicitation is worth pursuing. Use a structured framework (like this free guide) to evaluate whether a proposal aligns with your technology, expertise, and resources. Making smarter bid/no-bid decisions upfront saves countless hours on unwinnable proposals. Remember to look for signs that a bid is “shaped” or tailored so only one pre-selected company can win.
Use Proposal Templates and Guides
Pre-built templates, our Cost Volume Builder, can shave hours off your preparation time. Accessing a winning technical volume can make it easier to see how to structure a work plan or personnel bios. Bringing the time to draft down on some sections not only reduces your overall time to complete a bid but allows you to focus on crafting compelling content that is unique to your proposal like your technical approach.
Standardize Boilerplate Content
Create reusable content for sections that you can plug and play into multiple proposals. There are the sections we tend to copy/paste with minimal updating:
Key Personnel (team bios and expertise)
Commercialization Plans
Facilities and Equipment
Company Financials
Past Performance Summaries
By standardizing these sections, you’ll have a head start on every proposal.
Maximize Pre-Release Periods
During the pre-release phase, reach out to the Technical Point of Contact (TPOC) listed in the solicitation. Use this time to ask clarifying questions, gather insights, and refine your approach. This proactive step can ensure the core scope of your proposal is refined early and socialized within your team to prevent costly rewrites later.
Automate Where Possible
Tools like cost volume builders or using agency provided templates can streamline complex tasks like budget creation and document formatting. These tools not only save time but also reduce errors, ensuring your proposal meets agency requirements.
Use AI tools…cautiously
If startups were winning 3x the work with primarily AI generated proposals, we’d be hearing about it. From our experience, current AI tooling is selectively helpful. Let’s talk about some examples of where to use it and where not to.
Helpful:
Generating new bios: Provide an AI agent/tool that is restricted (ie the data can't go back to the main model like NotebookLM) with the resume of a new team member and ask to generate a first draft bio.
Adding current event references to your Mission Need Section: Ask an AI agent for news articles covering a specific topic. You can often pull great quotes from these.
Quickly review the solicitation references: Provide a restricted AI agent/tool with the papers cited in a solicitation and ask for a summary.
Not Helpful:
Prompting an AI agent to make your work plan. You can do a rough draft outline and ask it to transform it into full sentences/flesh it out. But a fully AI generated work plan is unlikely to align to how you’d do business and may not align to the evaluation criteria.
Having an AI agent to write your technical approach. This should be where your company shines with your methodology. Chances are, there will be another proposal with the same or similar scope proposed. How you will make sure that scope turns into a deliverable that positively impacts the warfighter is how you stand out.
By implementing these strategies, you can significantly reduce the time and effort required to submit a competitive proposal. What do you do with the time you claw back from proposal writing? You focus on non-federal revenue streams to hedge your business against the uncertainty.
With your newly found “free” time from reducing proposal/gov sales capacity, do/ consider the following to diversify revenue streams:
Explore Commercial Sales (aka Dual Use)
Use your expertise and IP to target commercial markets. This can provide an immediate and scalable revenue stream compared to government contracts. Use your SBIR work for marketing material (think videos, ebooks, blog case studies, etc) to reach the commercial audience.
Monetize Unused SBIR Work
If you’ve developed tools, templates, or processes internally while pursuing SBIRs, consider selling them. There are ways to redact and extract value for the material by selling them as digital products. Another option is to sell the SBIR rights to lines of R&D your company has decided to no longer pursue. There are agencies that can help you find buyers for a fee for this.
Pursue Phase III Opportunities
Yes this one is still tied to federal funding, but it's a different color of money. Phase III SBIR contracts allow you to sell your SBIR-funded innovations directly to the government without additional SBA funding limitations. SBIR Christmas is a real thing, so if you start now in the spring you could land Phase III contracts before the next financial year. SBIRconnect.com, The Outpost, and Long Capture and similar firms specialize in securing Phase III contracts for a fee.
Leverage Internal Tools
Reflect on the tools and resources you’ve developed internally. Could these be repurposed or packaged as other products? This might sound strange but it's surprisingly common. Before it was the workplace communications powerhouse it is now, Slack was originally an internal tool used by a development team for quick chats. It wasn’t spun out into its own product until much later.
While it survives, the SBIR program is a great tool for startups to secure equity-free funding, even during times of uncertainty. By streamlining your proposal process with templates, automation, and smarter bid decisions, you can continue to benefit from the program while reclaiming valuable time. The unsure future is forcing companies off the SBIR hamster wheel which while uncomfortable for those grown accustomed to relatively string-free money, it’s the push many small businesses need to seek out true annual recurring revenue.
