---
title: "What Is STTR?"
term: "STTR"
description: "STTR (Small Business Technology Transfer) is a US federal program that funds collaborative R&D between small businesses and research institutions, alongside the related SBIR program."
date: 2026-07-25T00:00:00.000Z
updated: 2026-07-25T00:00:00.000Z
topics: ["venture-capital"]
source: https://venturecapitaltracker.com/glossary/sttr
---

# What Is STTR?

> STTR (Small Business Technology Transfer) is a US federal program that funds collaborative R&D between small businesses and research institutions, alongside the related SBIR program.

**STTR**—Small Business Technology Transfer—is a US government program awarding R&D grants to small businesses working with universities or federal labs.

## How it works

Agencies like NIH, NSF, and DoD set topics; startups partner with research institutions on Phase I (feasibility) and Phase II (development) awards. Unlike pure SBIR, STTR requires formal collaboration with a nonprofit research partner. Awards are non-dilutive but come with reporting, IP, and sometimes commercialization obligations.

Many biotech and hard-tech startups stack STTR/SBIR with seed VC, using grants to de-risk technical milestones.

## Why it matters

- **Founders:** Grants extend runway without cap table impact but consume time writing proposals and meeting compliance.
- **Investors:** Non-dilutive funding can validate science; check IP ownership between company and university.

## Common mistake

Assuming grant revenue replaces venture scale-up capital. STTR phases fund R&D, not sales teams or GTM at scale.

## Related ideas

SBIR, non-dilutive funding, deep tech, and university tech transfer.
## When you will see it

University-linked deep-tech startups often pursue STTR Phase I awards to fund proof-of-concept work with a lab partner before seed VC.

## Questions to ask

- Who owns foreground IP versus background university IP?
- What commercialization milestones attach to Phase II?
- How do grant reporting burdens affect founder time?
## Practical takeaway

Treat **sttr** as something to define precisely in writing—not assume everyone in the room shares the same meaning. In term sheets, board decks, and LP updates, tie the concept to a concrete decision: a vote, a price input, a fund policy, or a metric formula. When definitions drift, teams misprice risk, miss leverage, or waste cycles on the wrong conversation.

## FAQ

### What is sttr in simple terms?

STTR (Small Business Technology Transfer) is a US federal program that funds collaborative R&D between small businesses and research institutions, alongside the related SBIR program. It is a label you will hear in deal conversations, cap tables, and fund marketing—not abstract theory.

### Why does sttr matter?

Deep-tech founders use STTR grants for non-dilutive capital before or alongside venture rounds. Founders and investors both need a shared definition before term sheets, diligence, or exit talks get serious.


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Source: https://venturecapitaltracker.com/glossary/sttr