The most expensive sentence in small-business federal contracting is "we can't bid that, we don't have past performance." It sounds like prudence. Often it is a misreading of the rules, and it hands the work to competitors who read them more carefully. No past performance on government contracts is a rating condition with written procedures behind it, not a disqualification, and the new firms that win treat it the way an auditor treats a thin file: as an evidence-assembly job that starts long before the solicitation drops.
Start with the rule. The Federal Acquisition Regulation has long said that an offeror without a record of relevant past performance, or one for whom the information simply is not available, may not be evaluated favorably or unfavorably on past performance. That language sat for years at FAR 15.305(a)(2)(iv). The Revolutionary FAR Overhaul carries it forward nearly word for word at 15.202(c)(1), and the Department of War's Part 15 class deviation directs its contracting officers to use that overhauled text. The overhaul also requires every request for proposals that evaluates past performance to describe how it will treat offerors with no relevant performance history.
That is the direct answer, with an honest limit: a neutral rating is a floor, not a win. The same sentence that protects you from being marked down forbids the evaluator from marking you up, so in a tradeoff source selection a competitor with a strong, relevant record can still be rated above you on that factor. Neutral keeps you in the competition; it does not carry you through it. A firm without a prime contract should not lean on it alone, because the rules offer other places to find a record.
What the rules let a new firm put on the scale
The overhauled Part 15 tells evaluators to consider information about predecessor companies, key personnel who have relevant experience, and subcontractors that will perform major or critical aspects of the requirement, when that information is relevant to the acquisition. Read that list as an inventory. Picture a firm founded last year by two engineers who spent a decade running network operations for a defense program: no corporate record, but key personnel the regulation names as worth weighing, provided the proposal spells out who did what work and why it maps to this statement of work.
Keep two words apart that proposals often blur. Past performance asks how well you did the work; experience asks whether you have done work like it. The overhaul lists them as distinct non-cost factors, and a solicitation that scores them separately can reward documented experience where the performance record is thin.
Joint ventures are the next lever. The overhauled FAR says that when a joint venture does not itself demonstrate the past performance needed for award, the past performance of each party to it must be considered. Under 13 CFR 125.11, implementing section 868 of the FY2021 National Defense Authorization Act, a small business that has been a member of a joint venture may elect to use that venture's past performance on a new prime offer where it does not independently demonstrate what award requires. The election requires naming the venture and its contracts and stating the duties the small business actually carried; work performed exclusively by partners cannot be claimed. It is also where a mentor-protege joint venture pays the protege back on later bids, and it is worth only as much as the protege documented about its own share while the work was underway.
Subcontract work is where small firms quietly hold the record they need, and where they lose it. CPARS evaluates prime contractors, so a subcontractor's good work usually appears in no federal system. Section 125.11 closes part of that gap. On a prime contract that included a subcontracting plan, a small first-tier subcontractor may ask the prime for a past performance rating, and the prime must deliver it within 15 calendar days on the FAR five-level scale, covering technical quality, cost control where it applies, schedule, and management. The subcontractor has to ask, and by default within 30 days after the prime contract's period of performance ends. The obligation reaches only prime contracts with subcontracting plans, though SBA's rulemaking noted a prime may volunteer a rating elsewhere for an agency to weigh at its discretion. For everything outside the rule, a prime-signed past performance questionnaire or reference letter remains the practical instrument.
The record a new firm needs usually exists. What is missing is the paperwork that proves it, and that paperwork has a deadline.
Two more doors open for some readers. When a small business prime's proposal identifies a team of small business first-tier subcontractors, 13 CFR 125.2(g) requires the agency to consider each identified teammate's capabilities, past performance, and experience as the prime's own, where the prime alone would fall short. And for defense work, the DoD supplement's Part 215 deviation directs contracting officers evaluating a small business in a competitive solicitation to consider relevant past performance information provided for the offeror's affiliates, implementing section 865 of the FY2024 NDAA. Finally, commercial past performance counts. The overhaul requires solicitations to let offerors identify similar contracts across federal, state and local government, the private sector, and other customers.
Section L and M decide what counts
Everything above is permission; the solicitation decides value. The source selection authority determines relevance, and the RFP may spell out how currency, relevance, source, and context will be weighed. The definitions you need sit in Section L and Section M: how many references you may submit, how far back "recent" reaches, whether "relevant" turns on dollar value, scope, or complexity, and whether key personnel, teammates, or joint venture partners may supply references at all. A reference outside the recency window earns nothing, however good it is. MacZine has argued for reading the clauses and Section L and M before bid-no-bid; the past performance factor deserves the same early read, because it tells you which evidence to chase.
The evaluation method changes the stakes. Under lowest-price technically acceptable, past performance, where evaluated, is a pass-or-fail call with no comparative scoring, and a small business that would have been in contention but is found unacceptable on it must be referred to SBA for a Certificate of Competency determination. In a best-value tradeoff, the thin record competes on a sliding scale, and assembled evidence does the work neutral cannot.
Consider the job as a calendar rather than a panic. A small subcontractor on a prime contract with a subcontracting plan diaries the 30-day rating request against the day that contract's performance ends, and asks the program manager for a signed questionnaire while the names are fresh. It writes up its joint venture duties now, in the terms a 125.11 election will later demand. That is record keeping, not proposal writing, and it is why finding the right opportunities and proving you can perform them are best treated as one pipeline.
MacTech writes proposals for clients - the Market lists volume authoring to the Section L and M structure and a per-bid pursuit package - and a live solicitation is worth a conversation before the no-bid email goes out. But no writer can conjure a record that was never kept. The verdict on a bid like this comes down to one inventory: the ratings, questionnaires, teammate records, and personnel histories a firm can put in front of the evaluator by the due date. The firm that started collecting them on its first subcontract walks into the evaluation with a file. The firm that starts the week the RFP posts walks in with a neutral rating and a story about why it deserved better. ◆