The Rise of SBIR Acquisitions in Government Contracting

This report discusses the increasing trend of Small Business Innovation Research (SBIR) acquisitions within the government contracting sector. It outlines how past SBIR funding can create a legal and strategic pathway for obtaining sole-source contracts under federal acquisition rules. The authors detail the implications of this trend for both large government contractors and small businesses that have received SBIR awards. The report emphasizes the importance of understanding the legal foundations and strategic drivers behind these acquisitions, as well as the diligence required to navigate the complexities of SBIR-driven mergers and acquisitions (M&A). It also highlights the potential risks associated with improper execution of legal requirements for sole-source SBIR Phase III awards, which could lead to bid protests and procurement challenges. The article aims to provide insights for stakeholders involved in this evolving landscape, emphasizing the need for careful structuring of acquisitions to capture the intended value of SBIR awards.