How Small Tech Companies Are Winning Multi-Million Dollar Sole-Source Contracts: Powered by SBIR

Jul 1

TL;DR: The Power of SBIR Phase III

SBIRs aren’t just about early-stage R&D funding.
They can lead to multi-million dollar sole source contracts with no competition required.
Most companies don’t use this path — or even know it exists.
The authority is already in the FAR, and agencies are now encouraged to use it to move faster.
Phase II is the gateway. Phase III is the game changer.
Smart companies build with sole source in mind and align early with mission needs.
New SBIR topics just dropped.
Now is the time to align your tech with real DOD problems — and start the right conversations early.

🎯 I’m offering a July-only SBIR Strategy Boost to help small tech companies identify the right topic, avoid the common traps, and build a roadmap that gets them noticed.

🔗 Schedule a discovery call here

When I first stepped into the world of defense innovation, I worked at a small technology company doing bold, technical work, the kind most people said couldn’t be done.

We weren’t just chasing contracts.
We were building breakthroughs.

And we were doing it with a quiet advantage that most companies still don’t use today.

That company had figured out how to use the Small Business Innovation Research (SBIR) program not just as a funding source, but as a launchpad for multi-million dollar, sole-source contracts.

They weren’t winning one-off awards.
They were building a DOD-facing business.

Here’s how:

They were strategic with their SBIRs.
They selected topics that aligned with their core product suite.
They prioritized real-world DOD needs.
When they won Phase II funding, they leveraged a built-in benefit that is rarely discussed: the ability to receive follow-on contracts without competition.
And they brought in expert consultants who helped them navigate shifting rules, evolving timelines, and agency expectations.

Because here’s the truth, no one likes to say:
Winning SBIRs isn’t just about good tech.
It’s about timing, alignment, and understanding how to navigate within a complex system.

They didn’t try to figure it out alone.
They brought in help where it mattered and because of that, they moved faster, focused better, and built stronger relationships with the agencies they served.

That SBIR sole source path is already authorized in the Federal Acquisition Regulation (FAR), it’s not new, just underused.

Yet most companies don’t leverage it.
Many people are unaware of its existence.

Because here’s the truth:
The power of SBIRs isn’t just in Phase I or even Phase II.
It’s in Phase III, where follow-on contracts can scale from six figures to seven or more, with no recompete, no delay, and no barrier between you and the mission need.

I’ve seen this path take companies from struggling to make payroll… to measuring profit in seven digits.

And now?
In today’s fast-moving, resource-strapped acquisition environment, this is becoming one of the smartest strategic moves a small business can make.

Multiple DOD agencies are openly discussing SBIRs as a preferred funding pipeline.
Large primes are also paying attention, and in some cases, actively teaming with SBIR awardees as subcontractors while the small business leads the contract.

How They Did It

They were strategic with their SBIRs.
They selected topics that aligned with their core product suite.
They prioritized real-world DOD needs.

When the small tech business won Phase II funding, they leveraged a built-in benefit that is rarely discussed: the ability to receive follow-on contracts without competition.

And they brought in expert consultants who helped them navigate shifting rules, evolving timelines, and agency expectations.

However, winning SBIRs isn’t just about good tech.
It’s about timing, alignment, and understanding how to navigate within a complex system.

What Most Companies Overlook

That SBIR sole source path is already authorized in the Federal Acquisition Regulation (FAR). It’s not new, just underused.

Yet most companies don’t leverage it.
Many people are unaware it exists.

Because here’s the truth:
The power of SBIRs isn’t just in Phase I or even Phase II.
It’s in Phase III, where follow-on contracts can scale from six figures to seven or more, with no recompete, no delay, and no barrier between you and the mission's needs.

I’ve seen this path take companies from struggling to make payroll to achieving seven-figure profits.

And now, in today’s fast-paced, resource-constrained acquisition environment, this is becoming one of the most strategic moves a small business can make.

Why This Matters Right Now

Multiple DOD agencies are now openly discussing SBIRs as a preferred funding pipeline.
Large prime contractors are paying attention, too. In some cases, they are actively teaming with SBIR awardees as subcontractors, with the small business leading the contract.

If you want to grow quickly and sustainably in the defense market, this is your moment.

What That Company Got Right

They selected topics that expanded real capabilities.
They focused on agencies aligned with their long-term goals.
They solved specific mission problems.
They did it all with Phase III in mind.

They used SBIRs as a foundation to grow a sustainable defense-focused product line. Every topic they selected expanded a capability they knew was mission-aligned. They studied which agencies they wanted to work with, understood the problems those programs needed solved, and built toward a bigger vision.

What Is Sole Source and Why It Matters Right Now

If your company earns a Phase II SBIR and remains in good standing, you qualify for sole-source follow-on contracts under current regulations. That means agencies can award you contracts without having to go through a competitive process.

In today’s acquisition landscape with shrinking teams, growing urgency, and pressure to move faster, this is one of the most valuable tools in the DOD’s acquisition toolkit.

Smart companies are using it well. Here is how:

They educate the government buyer about the sole-source pathway
They connect early, during RFI or even pre-RFI phases.
They team with primes to build larger awards with less frictio.n
They position themselves as low-risk, high-value partners with a clear contracting route already in place

The Navy has been leading the way in this area. Other agencies are following fast. You want to be ready.

How You Can Leverage This

If you’ve never applied for SBIR funding:

Start with the next SBIR topic pre-release. They’re posted on the first Wednesday of each month at www.dodsbirsttr.mil.
Look for areas that match your current capabilities and where the tech could evolve into something mission-relevant.
Think long-term. What will this help you build? How can you use this technology to create a product?

If you’ve already won a Phase II:

Do not sit back. Start outreach now.
Help agencies understand how to use the sole source pathway to bypass months or years of acquisition time and work with you.

Pro tip: Focus on their problem, not your product. The best conversations start with mission needs, not feature lists.

Position your company as an easy “yes.”

If you’re in between:

Look for teaming opportunities with Phase II awardees.
Many companies do not realize that their award could help attract others with complementary capabilities. This can lead to much larger, multi-million-dollar partnerships.

Final Thought

There’s no magic trick to this, but there is a playbook.

The SBIR program isn’t just about small contracts or tech validation. When used strategically, it becomes a pipeline to meaningful, ongoing business with the federal government.

🎯 Want to make this SBIR round count?

I’m offering a July-only SBIR Strategy Boost. A focused, 60-minute session to help you identify the right topic, avoid common traps, and build a custom roadmap that aligns your technology with what DOD evaluators want.

📍 Flat fee: $250, credited toward future work if you decide to move forward
⚠️ Very limited availability. I’m only opening a handful of spots this July

🔗 Schedule a discovery call: https://calendly.com/tracy-alignedgrowthsolutions/discovery

💬 Do you have a question or wonder if this approach is a good fit for your company?
Email me directly at Tracy@AlignedGrowthSolutions.com

About Dr. Tracy Boyd

Dr. Tracy Boyd helps small tech businesses unlock non-dilutive funding and meaningful traction in the federal market. With over 20 years of experience across DOD innovation programs and a deep background in technology, including hands-on experience, she has helped hundreds of technology companies bridge the gap between big ideas and government investment. Her strategies have contributed to over $650 million in awarded funding. Learn more here.

Tracy Boyd