Grant Verses Contract—What’s the Difference?

Contracts and grants are the two pathways to funding in the SBIR/STTR program. Some agencies are granting agencies, some agencies are contracting agencies and some agencies are both. Some agencies are one, but act like the other!

Have you ever wondered what the difference is between grants and contracts? Here are a few of the major differences that apply no matter what agency you are considering. These distinctions can help you determine which path is right for you—grants or contracts.


Grants Contracts
Topics Investigator-initiated (broad in scope) Agency-initiated (very specific)
Contact with Program Staff Encouraged and welcomed anytime Restrictions on communications (rules apply—blackout periods)
Budget Room for larger budgets (NIH only) Firm fixed price contracts
Submission Most often (or NIH’s ASSIST system) Agency portal
NIH Due Dates Standard Due Dates apply (Sept 5, Jan 5, April 5) Standard Due Dates do not apply
Review Process Uses a panel of outside experts to evaluate the merits of the technology and commercial market Often internal review teams determining if the technology meets the agency’s needs
Communication During Project Period Agency is hands-off during the project period Company works hand-in-hand with agency during project period
Resubmission Permitted to resubmit proposal that is revised in response to reviewer comments Not permitted. Topics do not often repeat
Commercialization at the end of successful Phase II The agency is not the customer at the end of the project The agency is often the first customer of the technology (DoD often results in sole-source procurement contract)