The Atlas of Innovation is a project of IFP
R&D Contracts
Agreements with private sector companies to conduct research and development toward specific technical objectives.
R&D contracts are agreements between funders and private sector companies to conduct research and development aimed at achieving specific technical objectives. Unlike grants, which typically support researcher-directed inquiry, R&D contracts specify deliverables and milestones that contractors must meet. This approach leverages private sector capabilities, efficiency, and expertise while directing efforts toward funder priorities.
The Defense Advanced Research Projects Agency (DARPA) has pioneered the effective use of R&D contracts to achieve breakthrough innovations. By setting ambitious technical challenges and contracting with companies to solve them, DARPA has catalyzed technologies ranging from the internet to GPS to autonomous vehicles. The key is combining clear objectives with the flexibility for contractors to innovate in how they achieve them.
R&D contracts work best when private companies have relevant expertise and capabilities, when you can specify clear technical objectives, and when you want more control over research direction than grants typically provide. They’re particularly effective for translating basic research into practical applications and for problems where commercial incentives alone are insufficient to motivate private investment.