Small Business Innovation Research

Small Business Innovation Research (SBIR), together with Small Business Technology Transfer (STTR), is the Department of the Air Force's (DAF) vehicle for applying small-business innovation to technological problems under 15 U.S.C. Section 638. AFWERX administers the program and aims to deliver disruptive air and space capabilities by connecting technology developers with Airmen and Guardians. The program is carried in the Air Force Research, Development, Test & Evaluation appropriation, Budget Activity 6, RDT&E Management Support, which covers efforts and operations that support general RDT&E.

Rather than prescribing one fixed set of technologies, AFWERX adjusts its investments to known and emerging technology gaps, warfighting demand, and assessments of an industrial base that relies on commercial industries. Its work connects industry, academia, and government; creates capability options and prototype opportunities; facilitates streamlined acquisition; and fosters innovation within the DAF. Funding decisions across its three approaches also depend on when funds become available and on changes in strategic guidance or priorities. Program funding includes administration and the due diligence needed to support SBIR activity.

Open Topic uses a technology-agnostic solicitation to invite commercial firms to propose dual-use solutions without first identifying a DAF end user. This approach gives industry a route to bring unexpected capabilities and emerging technologies to the department. It is also intended to broaden access to the defense innovation base rather than limit proposals to predefined requirements. Using fiscal year (FY) 2025 funds, the Air Force made Open Topic awards, with additional awards expected; since the approach began in FY 2019, it has produced more than 6,400 small-business contracts.

Specific Topic starts with a more defined operational need. Its solicitations seek innovative solutions to priorities identified by the Secretary of the Air Force (SECAF) and to problem sets established by a DAF end user or customer. Each topic therefore includes both clearly defined requirements and a known prospective customer, distinguishing it from Open Topic's search for solutions without a predetermined user. The Air Force made Specific Topic awards using FY 2025 funds and expected further awards from that funding.

Strategic Funding Increase (STRATFI) and Tactical Funding Increase (TACFI) help Phase II projects grow to the scale required for technology transition. They reduce development risk by bringing together multiple partners focused on transition and by leveraging investment beyond the SBIR/STTR program. With FY 2025 funds, AFWERX awarded 18 STRATFI and 68 TACFI contracts across a range of topics. This approach addresses the gap between a promising Phase II effort and a capability ready to move toward operational use.

STRATFI awards covered applications including rapidly deployable precision landing, hard-target surveillance radar, on-site jet-fuel manufacturing, augmented-reality maintenance training, and hypersonic missile development. Other efforts addressed artificial-intelligence-assisted tools, decisions at the edge, sensor fusion and automation, expeditionary manufacturing, strike enhancement, advanced engine components, forecasting, data mining, and alternative sensor deployment. TACFI topics spanned artificial intelligence, hypersonics, human performance, materials and manufacturing, munitions, information dominance, aerospace systems, directed energy, digital capabilities, and advanced sensors. These examples show how the transition-focused awards serve distinct operational and technical demands.

The budget history distinguishes prior awards from the requested-year plan. The FY 2025 program total reflects an SBIR/STTR transfer added to the current President's Budget; the exhibit shows no programmed amount for FY 2026 or FY 2027, including the FY 2027 base and overseas contingency operations columns. Nevertheless, the Air Force states that, if SBIR/STTR is reauthorized, FY 2027 activity would continue to align with Air Force priorities while investing in emerging technologies that may yield future capabilities. It would allocate available funds among Open Topic, Specific Topic, TACFI/STRATFI, and associated administration according to demand, funding timing, and strategic priorities the same conditional approach described for FY 2026.