Exploring Department of the Navy SBIR Phase III awards and corresponding public sector commercialization success factors

The United States Government’s Small Business Innovation Research (SBIR) program has invested funds for research and development at domestic small businesses since its inception in 1982. Awards made through the third phase of the program specifically focus on the successful commercialization of a technology or product; are derived from, extend, or complete a prior SBIR effort; and are not funded through the SBIR program but rather through an awarding agency. While SBIR Phase III awards are rare, these awards provide a valuable commercialization pathway for firms to scale and deploy new technologies and products. This research explores public sector commercialization as evidenced by the receipt of a Department of the Navy SBIR Phase III award and discerns successful attributes of recipient firms. Publicly available data on SBIR awards made between 2008 and 2021 are collected from different sources and aggregated. Machine learning methods run on the selected sample are capable of predicting which SBIR Phase II awards will advance to a Department of the Navy SBIR Phase III award approximately 60% of the time, demonstrating that the receipt of such an award is not strongly predictive of commercialization success. Furthermore, new insights are revealed regarding attributes that can potentially position a firm that has received a SBIR Phase II award for public sector commercialization success through the SBIR program.