Small internal combustion engines (ICEs), (<7.5 kW), possess low thermal efficiencies due to high thermal losses. As the surface area to volume ratio increases beyond 1.5 cm2/cc, the increase in thermal losses leads to a drop off of engine efficiency and power. This effort describes the development and validation of a test stand to characterize thermal losses of small ICEs, optimize combustion phasing, and eventually enable heavy fuel operation. The test stand measures torque, rotational speed, brake power, intake air mass flow, up to 48 temperatures (including ambient, intake, cylinder head, fuel, and exhaust), 8 pressures (including ambient, intake, and exhaust), throttle position, and fuel and air mass flows. Intake air temperature and cylinder head temperature are controlled and adjustable. Three geometrically similar engines with surface area to volume ratios near 1.5 cm2/cc were selected from 3W Modellmotoren. During bench validation the 3W 55i engine's power, torque, brake specific fuel consumption, efficiency, and equivalence ratio were mapped in the stock configuration. The engine developed a peak power output of 2.1 kW at 7000 rpm, 54% of its manufacturer rated power. Additional tuning of the exhaust or carburetor may achieve manufacturer rated performance.