This isn't really true. Not only are SIBR rewards generally low, but it's very easy for contracts to be pulled out from under you via larger contracting firms and there is a ton of risk involved for the employees.
I would never ever go back to that environment after working in it for a few years. Not knowing whether or not you're going to have a job for over a month every year is not fun. Larger contracting firms can shuffle people around in those cases but for smaller ones it kills an entire team.
We are onboarding a remote team this week for a government contract working with CNCF tooling in AWS. COVID changed what is allowed. Also SBIR phase II for open topic are 750k for the next period.
That's $750k for two years, which is paltry when you consider that your average senior engineer salary is likely to be in the range of 150k+ per year because of how much the major players offer and you also don't get funding for Phase III. A small team of engineers and QA will eat up that award quickly. This is without factoring in other things your company needs to navigate the government labyrinth, healthcare and more if you aim for commercialization.
If you and your team are willing to be underpaid relative to other companies and deal with the risk that working on government contracts entails a smaller contracting company might survive for a few years.
750k for 9 months. You need to write the scope to be profitable, just like any other fixed firm contract. If you execute in a need area phase 3 should be high percentage if you build the right relationships during your phase 2.
I would never ever go back to that environment after working in it for a few years. Not knowing whether or not you're going to have a job for over a month every year is not fun. Larger contracting firms can shuffle people around in those cases but for smaller ones it kills an entire team.