The SBIR program provides funding for small businesses to engage in federal research and development that has potential for commercialization. It aims to stimulate innovation, meet federal R&D needs, increase commercialization of innovations, and foster participation from socially disadvantaged businesses. The program awards contracts in three phases to allow for feasibility research, full R&D, and commercialization efforts. The similar STTR program focuses on cooperative R&D between small businesses and nonprofit research institutes like universities.