Non-Dilutive Funding for Climate, Health and AI Startups: Sector Guide

Most non-dilutive funding guides treat “startups” as one group. In practice, the best programs are organised by sector, because agencies fund the problems they are mandated to solve. If you build in climate, health or AI, there are programs designed for you, and many founders never apply to them.

This guide maps the main routes for each vertical, shows what they have in common, and explains how to prioritise. Program terms, topics and deadlines change often, so confirm details on each program’s official page before you plan around them.

How sector funding works

Non-dilutive capital comes from three broad sources:

Federal agencies, mostly through SBIR and STTR programs, which each participating agency runs against its own mission.
State and regional bodies, including energy offices, economic development agencies and innovation authorities.
Foundations, prizes and corporate programs, which offer cash, credits or in-kind support for specific problems.

Your sector decides which agencies are relevant. If you are still choosing between program types, read our comparison of SBIR, STTR and state grants first.

Climate and energy startups

Climate is one of the best-served verticals for grant funding, because several federal and state agencies fund it directly.

DOE SBIR/STTR. The Department of Energy publishes topic areas across clean energy, grid, storage, industrial decarbonisation and related areas. Technical feasibility is the main bar at Phase I.
ARPA-E. Funds high-risk, high-reward energy technology through targeted funding opportunities. It suits teams with a credible technical path and a strong research story, not early ideas.
NSF SBIR/STTR. Includes climate and sustainability-related topics for deep-tech founders. NSF’s process starts with a short project pitch, which makes it a low-cost way to test fit.
EPA SBIR. Focused on environmental technology, including water, air and waste.
State energy programs. Agencies such as NYSERDA in New York and the California Energy Commission run their own funding. These often favour in-state pilots and manufacturing.
Cleantech competitions and incubators. Programs such as the Cleantech Open offer prizes and mentorship, and some national lab-linked fellowships provide stipends and lab access.

Tip: Climate reviewers want a believable route from lab or pilot to deployment. Name your first customer type and the data you will use to prove performance.

Health and life sciences startups

Health has the deepest federal funding base, and also the longest timelines.

NIH SBIR/STTR. The largest source of early-stage health grants, spread across institutes by disease area and technology type. Match your idea to the right institute before you write, since institute priorities differ.
BARDA. Supports medical countermeasures and related technologies, including through programs aimed at early innovators.
CARB-X. Funds early development of antibacterial products, diagnostics and related technology.
NIH I-Corps and similar customer discovery programs. Short programs that help you test commercial demand and often strengthen later grant applications.
Foundations and global health funders. Organisations such as the Gates Foundation run challenge-based funding for specific health problems.

Tip: Health reviewers care about clinical need, regulatory path and reimbursement. Include a short plan for FDA engagement even at Phase I. For writing advice, see our SBIR guide.

AI startups

AI founders often assume grants are for hardware and biotech. They are not, though the funding looks different.

NSF SBIR/STTR. Regularly includes topics where AI and machine learning are core, as well as AI applied to other fields.
Defense and civilian agency SBIRs. Programs run by groups such as AFWERX, DARPA and the Department of Energy regularly call for AI, autonomy and data tools. Topics are specific, so read each solicitation closely.
NIH. If your AI product serves clinicians, labs or patients, NIH is a credible AI funder.
Cloud and compute credits. Major cloud providers run startup programs that offer credits. They are not cash, but they cut your biggest early cost.
Research partnerships. University and national lab collaborations can bring compute access and co-funded work.

Tip: AI reviewers are tired of “we use AI” claims. Show a specific technical risk you will retire, the dataset you need and how you will measure success.

Plan for lead time. Federal reviews often run for months. Apply before you are desperate for the money.
Use the topic list. Agencies publish what they want. Write to those topics, not your own wording.
Stack small wins. Credits, prizes and a Phase I award can support each other and strengthen your next application.
Track everything. Deadlines, requirements and contacts pile up quickly. The Application Tracker gives every opportunity a stage and a deadline in one place.

Where to start this week

Pick your primary sector and one adjacent sector, since many projects qualify for both.
Shortlist three programs from this guide and read their latest solicitations.
Browse the curated opportunities on our funding hub and filter for your vertical.
Log what you plan to apply for in the Application Tracker, so fundraising work stays balanced with revenue work.
Ask your network who has won these grants. A warm introduction to a past awardee is often the most useful thing you can get.

Non-dilutive funding rewards founders who match their work to a program’s mission and apply early. Start with the one program that fits best, and build from there.