It's been said many times before — veterans make the best entrepreneurs.
According to the Bureau of Labor Statistics, in 2015, the unincorporated rate of veterans who were self-employed was 7.1 percent (this includes veterans aged 55 years and older, who make up around 40 percent of the self-employed veteran population) — a number which has since increased.
The truth is, starting a business can be challenging, but it's certainly a task that can be handled by veterans. Not scared to take on new challenges, those who have served in the military tend to possess skills that directly translate into the world of entrepreneurship.
In fact, according the U.S. Small Business Administration (SBA), veterans are 45 percent more likely to become successful entrepreneurs compared to their civilian counterparts. When you think about it, those who serve in the military develop traits that are necessary for any entrepreneur, including risk-taking, determination, commitment, confidence and even time management.
As of 2014, there were more than 21 million U.S. veterans — and entrepreneurship has allowed so many of these individuals to not only secure a place in society, but also contribute in a way that is fulfilling. After all, veterans tend to be more tolerant to risk-taking and are able to put failure into perspective — something that's critical among successful business owners.
Have you been considering a start-up business yourself? If you are a veteran, this guide will provide you with everything you need to kick-start your next big idea in order to grow a successful business. It's time to show everyone what you're made of — and further support the theory that veterans make excellent business owners.
A History of Veteran-Owned Business
When it comes to entrepreneurship, times have changed for both veterans and non-veterans over the years, but in a way, that's what makes it exciting. In comparison to World War II vets, who often came home and worked in manufacturing before moving up and starting their own venture, veterans today need to think outside of the box.
Although it's self-rewarding to build a business, when you're a veteran, you also have an opportunity to build a business that provides other veterans with jobs and a level of security. For many veterans, the moment they're able to employee other veterans — that's when they feel a true sense of accomplishment.
When it comes to veterans starting businesses, what does history tell us?
It's clear that veterans are heroes. They protect our country and families, but many do not realize the positive impact they have on the business world. After all, veterans typically thrive within small business-oriented groups, as many led platoons within their military careers — perhaps you can relate?
Throughout history, many veterans have gone on to build and, more importantly, grow successful businesses. As mentioned, following World War II, there was a boom in veteran-owned business. In fact, more than 50 percent of veterans launched a business within the United States — and similar trends were seen following the Korean War.
What's even more inspiring is that the success rate among veteran business owners is nearly twice that of non-military business owners, which once again links back to the skills and experiences related to a military background — which will be discussed shortly.
In the past five years alone, there have been so many inspiring businesses run by veterans, many of which have 10+ employees. Take a look at Plated, founded by Nick Taranto of the U.S. Marine Corps (infantry), which now employs over 700 people, bringing healthy, affordable meals into the homes of those who love good food. Generating more than $100 million in revenue in 2015, this company is averaging revenue growth of 500 percent annually. Plated was even featured on "Shark Tank."
Plated is a great example, but it is just the beginning. There's a long list of successful veterans who believed in what they were doing and made it happen. After all, as so many veteran business owners have stated, the military is the best possible training for the day-to-day challenges and long days required when becoming an entrepreneur.
Here are a few more examples:
- Black Rifle Coffee Company — Founded by Evan Hafer, Army, Special Forces, this thriving company offers high-quality, small-batch coffee. Hafer admits that it wasn't an easy journey, but neither were the nine years he spent in some of the most dangerous areas on the planet. Through trial and error, as well as his tenacity to succeed, Evan has built an incredible business. In 2015, he was even able to give back $48,000 to organizations that mean something to Black Rifle Coffee Company, including the Thin Blue Line Project and the Marine veteran-founded Raider Project.
- Rhumbix — Founded by Zach Scheel, U.S. Navy, Seabee/Civil Engineer, and Drew DeWalt, U.S. Navy, Submarine Warfare, Rhumbix has created a solution to construction site data collection. Their app collects real-time information, such as delays, any current safety hazards, timecards, etc. This information is then inputted into their labor productivity platform in order to better review actual performance vs. budget. As they say,“Happier foremen, higher profits.”
- Bottle Breacher — Founded by Eli Crane, U.S. Navy, Navy SEAL, Bottle Breacher makes handcrafted 50-caliber bottle openers. The best part is, they're made by both Active Duty members and veterans. Also featured on "Shark Tank," their total sales increased from $150,000 to more than $15 million.
There are hundreds of these incredible success stories, all which were made possible due to the level of commitment and discipline among veterans. That is because so many inspiring veterans believe that they can create their own opportunities. As stated by the SBA, during the Great Recession and the recovery period (2007-2013), veteran households with small businesses, displayed higher income than non-veteran small business households.
Some of the most common industries for veteran-owned businesses include:
- Transportation and warehousing
- Professional, scientific and technical services
- Retail and wholesale trade
- Real estate
Regardless of the type of business you want to start, it's important to review some of these up-and-running, successful businesses mentioned above. What is the business model they used? Could you apply some of their tactics to your current business plan? Better yet, why not reach out to some of the businesses that inspire you? Networking can help you succeed that much more rapidly.
At the end of the day, the veterans listed above were successful for a reason — and all of them relate back to their experience in the military. There are so many skills that veterans possess, and when combined with ideal personality traits and business objectives, the sky is the limit. Just think about some of the skills you currently possess after leaving the military, including:
- The ability to stay highly focused — There's a reason why soldiers are able to complete more tasks by 10 a.m. than the average person does in a full day. They're focused and disciplined, and although owning a business is not a "military operation," that level of work ethic transfers into a person's ability to execute tasks so that they can succeed. Staying focused as a business owner is critical — especially during stressful situations.
- Great leadership — Building a business means that you need to provide leadership and support as your company grows. Not only are veterans typically great leaders, but they also are incredible team players. In terms of strategic planning and goal setting, this will come in handy. Also, when the time comes to hire employees, you can lead them toward personal success, as they help you grow your business.
- Drive to push forward — While in the military, the reality is that you need to plan for failure. If plan A is not successful, veterans have the mentality that failure isn't an option — you need to move to plan B. While running a business, early failure is an opportunity to learn and develop, and veterans are often comfortable with progressing forward once faced with a challenging situation.
There's no denying the level of skill that veterans possess, but what about that one key ingredient in terms of long-term business success? That component that helps drive one's ability to reach milestone after milestone — entrepreneurial spirit
Well, according to a study by the SBA Office of Advocacy, in 2004, 22 percent of veterans were either purchasing or considering a business startup. This study clearly showed that veterans are not only making a difference within their communities, but also that they play a significant role in the United States economy.
In 2016, the SBA released their Boots to Business Veteran Entrepreneurship Assessment, stating that there are approximately 2.5 million veteran-owned businesses within the United States (9.1 percent of all U.S. businesses), employing nearly 6 million citizens.
In fact, the Boots to Business program is an incredible opportunity for those seeking education and training. The program is part of the Department of Defense's Transition Assistance Program, and anyone affiliated with the Army, Navy, Marines, Air Force or Coast Guard is eligible to participate.
In 2014 alone, more than 100,000 veterans and service-disabled small business owners were trained or counseled by the SBA. Currently, this three-part program is available at over 165 military installations around the globe. If you are moving into the world of business, take advantage of every opportunity.
There are so many specialized training and mentorship programs that are specifically designed to help veterans make their business-related dreams come true. Although you will likely seek funding, which will be discussed momentarily, the level of guidance and support you can receive from these programs are worth their weight in gold.
Sometimes, it's just having someone there to really push you and give you that much-needed confidence boost in terms of your business-related ideas. Not only will they help you make more informed decisions, but they can also provide the level of assistance you require to obtain funding.
How to Start a Small Business
“Whenever you see a successful business, someone once made a courageous decision.” — Peter Drucker
Just like your fellow veterans, you too can start a business. It all starts with an idea. If you have an idea, you can then take action, building a tangible business. Although veterans most certainly make incredible entrepreneurs, that does not mean that due diligence isn't highly recommended.
Running a business is a complex operation, one that requires you to constantly evolve. Although it may seem overwhelming, starting a business is like any other task — and as a veteran, you have faced some tough assignments. When you begin to break down your end goal into smaller, more attainable steps, starting a business doesn't seem so frightening after all.
It's all about making informed decisions and taking all of the appropriate steps. Although there's risk involved in any new business, as well as with any existing business, when you take the right steps, you will significantly increase your chances of success.
In order to set the wheels in motion, here are some general, actionable steps to get you started:
- Do your research — At this point, you'll have a concept in mind, as well as a name. Remember, your business name should be unique and describe who you are. The SBA provides a thorough guide in terms of this process, including information on trademarks and how to register your new name. You will want to do some market research in terms of the industry you plan to enter. You will also want to study the demographics of your target market, their behaviors and even their attitudes towards the industry of your choosing.
- Write a business plan — If you are currently in the start-up phase, a business plan is essential. You need to define your business in terms of your mission, your objective, your competition, and key strategies in relation to marketing and sales. Don't overthink it — create a simple, step-by-step action plan to kick-start your efforts.
- Create a financial plan — Although you will likely touch on finances within your simplified business plan, you will also want to focus on what it is you require to get your business off the ground. What will your most essential start-up costs be? Will you require funding? The key here is to be realistic in terms of what you anticipate your budget to be and also to determine your approximate burn rate. Make a list of all the essentials to start operating, and be sure to keep thorough records, as many items solely used for business purposes are tax deductible.
- Start building your brand — Even before you officially launch, start to utilize all marketing streams that make sense. In this day and age, an online presence is essential. Start communicating with your audience using the most appropriate channels for your business, such as a Facebook page, an Instagram account or LinkedIn profile. Consider your business cards, the purpose behind your brand and the ways in which you'll reach your audience.
- Set goals — Whether you are beginning your business today or have been in business for years, you need to continuously set goals. One of the most important factors in regards to reaching your goals is setting practical, attainable deadlines. If you don't create timelines for each goal, time can quickly slip away. You need to be ahead of your competition and the way your business evolves will determine your next steps.
As a veteran, in many ways, you're at an advantage. When you are starting your business, there are a number of key factors that you should keep in mind. As a veteran, remember to:
- Stick with your passion and skill set — Whether you have experience in computers, operations, communications or all of the above, build your business off of your current strengths. What is it that you're passionate about, and how does your military experience back that level of interest? Thinking back to your field experience, is there anything that you felt there was a need for in the marketplace? From specific drinks to equipment, many veterans have created businesses based on a need.
- Utilize all resources — As a veteran, you have an advantage in terms of available resources. You are viewed as a selfless hero, which is why many organizations and government programs provide additional support for those who have served our country. A short list of these includes, but is not limited to,Veteran's Business Outreach Centers (with 19 locations nationwide), the Veteran Entrepreneur Portal and the Veteran Fast Launch Initiative.
When you're starting a business, you need to think about each and every step well in advance. Once you have gone through the steps above, including writing your business plan and registering your business, you then need to look as key aspects that are specific to your business. Ask yourself these questions:
- Do you need any specific licenses or permits? Do you require insurance? Make sure you are covering all the bases in order to protect both you and your business.
- What about laws and regulations? The SBA provides a thorough list of all of the laws that may relate to your business, including privacy laws, environmental regulations, labor laws and more — the list goes on. In order to build a sustainable business, you need to make the right decisions early on.
- Does your business need to obtain a tax ID? First, you'll need to determine your state tax obligations, as well as federal obligations. Also, the sooner you learn to become organized in terms of your sales and expenses, the easier tax season will be. Invest in some basic software to maintain organized records.
How to Find Business Grants for Veterans
You may currently have a fantastic idea and perhaps even a solid proof of concept, but there's just one issue — you lack the necessary funding to get your startup off the ground. Although many business owners self-fund their enterprise, this can quickly increase overall risk — so you need to ensure you have effectively planned each step.
When it comes to funding, you need to estimate your startup costs and, in many cases, prepare for financing. Back in 2009, it was estimated by the Kauffman Foundation that the average startup costs around $30,000. Of course, each business is unique — some can get started with $1,000, whereas in less common circumstances, others will require an initial investment of more than $100,000.
Before you seek any financial assistance, you need to better understand your costs. Your start-up costs are defined as the costs you'll encounter before you begin to make an income. Here are some of the initial costs you'll need to consider:
Expenses — This is what you'll need to spend in order to start your business, including market research, advertising, wages, professional services, the cost of products or raw materials, factory overhead, etc.
Capital expenses — These expenses will be one-time purchases and become assets within your business. This will include equipment, property, vehicles, etc.
Generally, "needs" are more critical during transitional phases, such as when you initially begin your business or plan to expand. Depending on the type of financial assistance you seek, you may also require additional information, including your business plan, bank statements, credit reports, etc.
Now, in order to get the ball rolling, you need to put yourself out there by asking questions and seeking assistance. There are plenty of organizations throughout the nation that are not only willing but eager to help veterans kick-start the business they have conceptualized. As mentioned above, reaching out to the Veterans Business Outreach Center Program or Score, an association of volunteer business counselors, will help you determine what's currently available for you based on your history, business and geographic location. In some cases, finding a mentor is the best possible stepping stone, as a mentor will guide you towards success — and, in this case, financial opportunities to grow your business.
In fact, there are even mentors who specifically work with veterans, as they are veterans themselves, helping individuals transition to a self-employed career following their time in the military. When seeking a grant — which is a lump sum of money that does not need to be paid back (as long as you stay within the grant guidelines) — there are a number of options, including:
Grants specifically for female veterans — This year, the SBA awarded $300,000 in Women Veteran Entrepreneurship Training Program grants to three key organizations.
Vocational Rehabilitation & Employment (V&RE) Program — As stated by the U.S. Department of Veterans Affairs, their mission is to fulfill President Lincoln's promise "to care for him who shall have borne the battle, and for his widow, and his orphan.” They currently offer this program to those who have become disabled as a result of their service.
United States government — Search for any available grants that will help you take your business to the next level. On their website, you'll find tips and tools for applying, as well as a guide for those who need to write a grant proposal.
In order to conduct a thorough search, head over to Federal Grants, where you'll find information on current grants and deadlines from more than 500 federal agencies. Although you may find a grant based on your personal demographics outside of the military, here you will find grants that are specifically offered to veterans.
At the end of the day, if you're currently looking for a grant, you need to do your research, finding both government and private opportunities. More often than not, federal grants are more strict than grants offered by organizations — however, they can be a little harder to come by.
It's also important to note that small business grants are often given to those who aim to enhance their community — or work within the technology, medicine or agriculture sector. The best thing you can do is to get on the phone or head to your local small business center. Based on your particular industry, they will help you find potential grants — and since you're a veteran, you will likely be eligible for more opportunities.
Small Business Loans for Veterans
For some, taking out a loan can seem a bit stressful, but for those who are ready to take their business to the next level, a loan can provide an excellent return on your investment. Although some view a loan as debt, others view a small business loan as an opportunity — and when you plan ahead, a loan can act as your ticket to success.
Think of it this way — if you have crunched the numbers and understand that you need a certain amount to begin operating and, more importantly, making money, then a loan can act as a huge advantage. As you begin to make money, you can rapidly pay off your initial loan as your business gains momentum. Best of all, in comparison to credit cards, for instance, a business loan will be offered at a much lower interest rate — one that makes sense for your business.
When you think about a loan, you likely associate this process with a bank. Of course, a bank is a reliable institute to receive funds from and is highly accessible, but the problem is that they often require a long list of prerequisites and, in many cases, applicants are rejected. The process can take weeks, and when you find out you've been rejected, you're back at square one — and as we all know in business, time is money.
If you require working capital and have been considering a small business loan, it's important to make this step as streamlined and rapid as possible. At Rapid Advance, we're known for "looking at the big picture" — meaning we assess all aspects of your current business in regards to your eligibility.
When you apply for a free quote, you can then better assess how it is you'd like to proceed. The reality is, if you're considering a small business loan, it's likely because you require access to cash in order to take the next step — and for those who have already begun their business journey, sometimes growth can happen much more rapidly than expected. You need to be ready so that your business can thrive and grow into a self-sustaining enterprise.
Rapid Advance offers an easy application that takes a few short minutes, and many are approved and able to access funds in as little as one day. We care about your business, as well as the fact that you're a veteran. When it comes to small business loans for veterans, we ensure that you take the right steps. We want you to succeed, and in many cases, financial support is a crucial component when aiming to reach your next major milestone.
What it all boils down to is that veterans often succeed when it comes to business development. All you need to do is look at the numbers. In 2007, veteran-owned businesses showcased sales of $1.220 trillion — with an annual payroll of $210 billion. Veterans are an integral part of the economy, and you too can cut yourself a piece of that large pie.
Whether you're looking for financial services or small business resources, we offer everything you need to get your great idea out there into the marketplace. Our country is so grateful for the sacrifices you made — now it's your turn to live out your passion.
Build your future dream business — contact us today.
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