Congressional Research Service IF12310.4 (The Small Business Administration’s Growth Accelerator Fund Competition)

Summary

This Congressional Research Service In Focus by Adam G. Levin, updated February 27, 2026, describes the Small Business Administration’s Growth Accelerator Fund Competition, which funds accelerators assisting STEM and R&D-focused small businesses and startups. The SBA first operated the competition in FY2014 under Section 105 of the America COMPETES Reauthorization Act of 2010, and Congress has not provided it with specific statutory authorization. From FY2014 to FY2025 it made 634 awards totaling $37.9 million; until FY2023 awards were $50,000, and in FY2025 stage one awards were worth $75,000 and stage two awards $150,000. For FY2026, Congress recommended $9 million in appropriations.

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Updated February 27, 2026
The Small Business Administration’s Growth Accelerator
Fund Competition
Small businesses and startups sometimes benefit from History
assistance growing their companies, including support for The SBA first operated the GAFC in FY2014, after a series
commercialization, mentorship programs, and capital of regional events in 2012 that convened over 100
access. Accelerators—organizations often operated by universities and accelerators in discussions about how to
experienced businesspeople—provide technical assistance work with high-growth entrepreneurs. These events helped
and other services to new entrepreneurs in an effort to meet lead to the development of the GAFC, which SBA has thus
those needs and support the starting and scaling of far held in FY2014, FY2015, FY2016, FY2017, FY2019,
businesses. FY2021, FY2023, FY2024, and FY2025.

Since 2014, the Small Business Administration (SBA) has Congress has not provided the GAFC with specific
administered the Growth Accelerator Fund Competition statutory authorization. Rather, the program operates as an
(GAFC) to provide financial support for accelerators SBA initiative under authority provided by Section 105 of
assisting science, technology, engineering, and math the America COMPETES Reauthorization Act of 2010
(STEM) and research and development (R&D)-focused (P.L. 111-358), which authorizes federal agencies to
small businesses and startups. Historically, the GAFC has administer innovation-related prize competitions. Several
often targeted accelerators that supported businesses and/or bills in recent years, discussed below, attempted to provide
geographies that traditionally faced barriers in obtaining statutory authority for the GAFC.
R&D funds and investment capital, including businesses Table 1 presents the number of awards and the total dollar
owned or led by women, minorities, and veterans, or amount awarded since the GAFC’s inception. From
businesses located in rural areas. Until FY2023, the GAFC FY2014 to FY2025, the GAFC made 634 awards totaling
provided $50,000 awards to accelerators for operating $37.9 million. In FY2026, Congress recommended the
capital. Since FY2023, the SBA has continued to fund GAFC receive $9 million in appropriations.
accelerator operations, but now makes GAFC awards in
two stages: in FY2025, stage one awards were worth Table 1. GAFC Awards Given, Total Value of Awards,
$75,000, and stage two awards were worth $150,000. More and Recommended Funding Levels, FY2014-FY2025
information on the purpose and structure of these awards is
available below. Total Congressionally
Awards Recommended
Purpose Fiscal Number of Amount ($ Funding ($ in
The SBA’s intent for the GAFC is to help facilitate the Year Awards in millions) millions)
success of startups by supporting accelerators that advise
2014 50 $2.50 $2.50
such businesses on growing revenue, sourcing outside
funding, and avoiding common mistakes. The GAFC’s 2015 88 $4.40 $4.00
goals include
2016 85 $4.25 $1.00
• increasing the pipeline and success of STEM/R&D- 2017 20 $1.00 $1.00
focused entrepreneurs and small businesses;
2018 0 $0 $1.00
• accelerating the growth and maturity of innovation-
based entrepreneurship networks; 2019 60 $3.00 $2.00
• catalyzing partnerships and relationships between 2020 0 $0 $2.00
accelerators to strengthen the national innovation
ecosystem; and 2021 84 $4.20 $2.00
• connecting both new and established participants in the 2022 0 $0 $3.00
national innovation ecosystem.
2023 75 $7.25 $10.00
Some GAFC award announcements have noted SBA’s
desire for the GAFC to stimulate entrepreneurship in 2024 96 $5.60 $9.00
“underserved” regions and industries. In discussing GAFC-
2025 76 $5.70 $9.00
related legislation, some Members of Congress have noted
the GAFC’s success in facilitating innovation in regions Sources: SBA, Congressional Budget Justification and Annual
beyond traditional coastal technology hubs. Performance Report (various years) and explanatory statements from
appropriations bills.

https://crsreports.congress.gov
The Small Business Administration’s Growth Accelerator Fund Competition

Program Implementation authority. H.R. 5376 evolved into P.L. 117-163 (commonly
The GAFC is open to applicants that are referred to as the Inflation Reduction Act of 2022, IRA);
the IRA, however, did not include any of the BBA’s GAFC
• private entities, both nonprofit and for-profit—including provisions. Also in the 117th Congress, H.R. 4945 would
corporations—based in the Unites States; have amended the Small Business Act of 1953 (P.L. 83-
163, as amended) to give the GAFC permanent statutory
• nonfederal government entities including state, county, authority and increase minimum award size to $1 million.
tribal, and municipal governments; The bill was introduced in the House but did not advance.
• academic institutions based in the United States; or
Considerations for Congress
• individuals or teams comprised of U.S. citizens or Congress may consider whether to give the GAFC statutory
permanent residents 18 years and older. authorization. Some Members of Congress have previously
argued that providing statutory authorization, rather than
In FY2023, the SBA implemented a new award structure continuing the GAFC as an SBA initiative, would give
for the GAFC and began awarding prizes in two stages. In Congress an opportunity to provide greater oversight.
FY2025, stage one awards, for $50,000, went to Codifying the GAFC could also provide an opportunity for
entrepreneur support organizations (ESOs) that have Congress to determine and codify the competition’s
identified challenges in their local entrepreneurial and small priorities and mission. For example, as noted, the GAFC
business “ecosystems.” ESOs included accelerators, has historically targeted small businesses and regions that
membership organizations, institutions of higher education, have had difficulty attracting financing. Congress could
and nonprofits supporting innovation-focused small codify this or other missions. Should Congress consider
businesses and startups through training and mentoring; doing so, it could also want to assess how effective such
facilitating access to resources; building connectivity within efforts have been, for example in the geographic diversity
an innovation ecosystem; and other activities. of awards. Congress may also be interested in assessing the
efficacy of the GAFC since it began its new, two-stage
Stage two awards—in FY2025 worth $150,000—are to go format in FY2023.
to ESOs to facilitate implementation of plans to address
challenges identified in stage one. The SBA intends for The SBA is not required to collect specific performance
ESOs to help entrepreneurs commercialize R&D efforts by metrics for the GAFC. H.R. 2686 and H.R. 4387 in the
using stage two awards to, among other activities, support 115th and 116th Congresses, respectively, would have
collaboration between entrepreneurs and institutions of required the SBA to gather certain metrics. For example,
higher education; develop intellectual property strategies; H.R. 4387 would have stipulated that the SBA develop
and generate proposals for new debt and equity instruments “science-based” metrics that measured the GAFC’s
to financial STEM and R&D small business capital. economic impact. Additionally, a 2018 evaluation of the
GAFC by the Library of Congress’s Federal Research
In FY2025, the SBA requested that ESOs support small Division (FRD) recommended that the SBA develop
businesses and startups working in one of two “themes”: “statistically sound” reporting metrics for the GAFC;
improve the collection, monitoring, and maintenance of
• lab to market, intended to bridge the gap between those metrics; and enforce mandatory reporting
research and commercialization in fields including requirements. Congress may debate if and how to act on
national and economic security, domestic manufacturing those recommendations.
and production, biotechnology, and other critical and
emerging technologies; or Congress may consider whether to require cost sharing.
• capital formation, intended to increase capital access for GAFC awardees are not required to provide matching
entrepreneurs and small businesses during the business funds. However, Congress and the SBA have considered a
formation and growth phases. cost share requirement. In the explanatory statement to the
Consolidated and Further Continuing Appropriations Act,
Recent Legislation 2015 (P.L. 113-235), Congress instructed the SBA to
The primary purpose of most GAFC-related bills in recent require $4 in matching funds for every $1 the agency
Congresses has been to provide the program with statutory awarded through the GAFC; the SBA did not act on the
authority. For example, in the 115th Congress, H.R. 2686 directive. The 2018 FRD evaluation also suggested a
would have given the GAFC permanent statutory authority required match could increase awardee engagement.
and required the SBA to develop metrics evaluating the
program’s effectiveness. In the 116 th Congress, H.R. 4387 Congress may consider the GAFC’s award size. As noted,
similarly would have provided the GAFC permanent bills in previous Congresses sought to set minimum award
statutory authority and required the SBA to develop sizes. The 2018 FRD evaluation (conducted when all
efficacy metrics. The bill passed the House but was not awards were $50,000) also noted feedback that the awards
taken up by the full Senate. would benefit from being increased or scaled. However,
Congress may note that the evaluation also found that the
In the 117th Congress, the House-passed version of the GAFC had been effective at its existing award sizes.
Build Back Better Act (BBA, H.R. 5376) would have
appropriated a total of $400 million to the GAFC through Adam G. Levin, Analyst in Economic Development Policy
FY2031, established a minimum award amount of
$100,000, and provided the GAFC permanent statutory
https://crsreports.congress.gov
The Small Business Administration’s Growth Accelerator Fund Competition

IF12310

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