Austin has established itself as one of the premier technology hubs in the United States, attracting startups, established tech companies, and venture capital. Tech startup founders in Austin may be eligible for federal innovation grants, state incentive programs, city-level resources, and a deep ecosystem of incubators, accelerators, and community lenders designed to support early-stage technology businesses.
This guide covers the most relevant programs and resources for tech startups in Austin.
Federal Innovation Grants
SBIR Programs
The Small Business Innovation Research (SBIR) program is one of the most significant non-dilutive funding sources for tech startups. Eleven federal agencies award SBIR grants for technology research and development, with Phase I awards typically ranging from $50,000 to $275,000 and Phase II awards up to $1 million or more. Austin startups in areas like cybersecurity, defense technology, energy technology, health IT, and enterprise software are well-positioned for SBIR opportunities across agencies including DOD, NSF, DOE, NIH, and NASA.
STTR Programs
The Small Business Technology Transfer (STTR) program requires startups to partner with a research institution. Austin's proximity to the University of Texas at Austin — a major research university — creates a natural partnership pathway for STTR applications. UT Austin's research portfolio spans computer science, engineering, materials science, and life sciences, all of which align with STTR-eligible technology areas.
NSF I-Corps Program
The National Science Foundation's Innovation Corps (I-Corps) program provides funding and training for academic researchers and startups to explore the commercial potential of their technology. UT Austin operates an I-Corps site that provides local teams with training, mentorship, and funding to validate their technology concepts.
Austin City Programs
Austin Economic Development Department
The City of Austin's Economic Development Department administers several programs relevant to tech startups, including small business technical assistance, workforce development support, and connections to local resources. The department also oversees the city's participation in incentive agreements for larger technology companies that create jobs in Austin.
Austin Small Business Programs
Austin administers small business certification programs including MBE/WBE certification that provides procurement preferences on city contracts. Tech startups that provide technology services, software development, or IT consulting to city agencies may benefit from these certifications.
Austin Energy Rebates
Austin Energy, the city-owned utility, offers commercial rebate programs for energy-efficient equipment and renewable energy installations. Tech startups operating data centers, server rooms, or energy-intensive computing operations can access rebates for cooling systems, efficient lighting, and solar installations.
State Programs Available in Austin
Texas Enterprise Fund
The Texas Enterprise Fund has been used to attract major technology companies to Austin and other Texas cities. While TEF is typically associated with larger deals, technology companies making significant job creation and capital investment commitments may explore eligibility.
R&D Tax Credit
Texas tech startups conducting research and development may be eligible for both the federal R&D Tax Credit and the Texas franchise tax R&D credit. The federal credit applies to wages, supplies, and contract research expenses for qualifying R&D activities. The Texas franchise tax credit provides additional state-level benefits for R&D conducted in Texas.
Skills Development Fund
The Texas Workforce Commission's Skills Development Fund provides grants for customized workforce training. Austin tech companies can partner with Austin Community College to access training funds for software developers, cybersecurity analysts, data scientists, and other technical roles.
Austin Startup Ecosystem
Austin's startup ecosystem provides a range of non-governmental resources that complement public funding programs:
- Capital Factory: Austin's largest accelerator and coworking space, providing mentorship, investor connections, and community resources for tech startups.
- Techstars Austin: A nationally recognized accelerator program that provides funding, mentorship, and investor access to selected cohorts of startups.
- UT Austin IC2 Institute: The university's innovation institute provides technology commercialization support, incubation, and accelerator programs.
- Austin Technology Council: Provides networking, advocacy, and professional development for Austin's technology community.
- SCORE Austin: Free business mentoring from experienced entrepreneurs and business professionals.
SBA and CDFI Lending
- SBA 7(a) loans: Up to $5 million for working capital, equipment, and business purposes.
- SBA Microloans: Up to $50,000 through community-based lenders like PeopleFund and LiftFund.
- PeopleFund: An Austin-based CDFI that provides loans and technical assistance to startups and small businesses in Central Texas.
Steps for Austin Tech Startup Founders
- Explore SBIR/STTR opportunities: Identify which federal agencies fund research in your technology area and begin preparing applications.
- Claim R&D tax credits: Work with your accountant to identify qualifying R&D activities and claim both federal and Texas franchise tax R&D credits.
- Connect with the Austin ecosystem: Engage with Capital Factory, Techstars, or UT Austin's commercialization programs for mentorship and investor introductions.
- Evaluate certifications: If you qualify for HUB, 8(a), WOSB, or SDVOSB certification, these can open government technology contracting opportunities.
- Explore CDFI and SBA lending: PeopleFund and SBA Microloans provide startup-friendly financing options.
Find Programs That May Fit Your Business
Austin tech startups can access a unique combination of federal innovation grants, R&D tax credits, state workforce training, and a robust local ecosystem. The key is identifying which programs match your technology area, business stage, and funding needs.
Not sure which programs may fit your business? Our free screening report checks your business against 150+ verified programs — grants, tax credits, loans, and incentives — and shows you which ones may match. Start your free screening →