By Dan Biga – Bunker Labs Nov 15, 2019, 6:00 am EST
Entrepreneurial veterans in America face two conflicting realities. First, research has shown that military experience gives veterans skills required for entrepreneurial success: creativity, willingness to take risks and leadership. Second, while approximately one in two veterans coming home from World War II started a business, just 5.6% of post-9/11 veterans become entrepreneurs.
The decline is not for lack of interest; nearly a quarter of today’s veterans want to start a business. The unfortunate reality is that after transitioning to civilian life, they face many obstacles to entrepreneurship. Our country is divided in many ways right now, but we still come together to support military veterans.
Fostering veteran entrepreneurship has both philosophical and tangible benefits. Veterans set aside their civilian lives and careers to serve the country. We should make it as easy as possible to transition back into civilian life. It’s the right thing to do for people who selflessly serve.
Aspiring military veteran entrepreneurs also represent an opportunity to benefit the broader military veteran community. According to a study by the Franchise Business Review, military veterans are 30% more likely than their civilian peers to employ other veterans.
Yet, for all of the value that entrepreneurship creates for veterans, they face numerous obstacles on their path to entrepreneurship. Fifty percent of veterans transition out of the service and end up in a city different from where they grew up. They often need to form new professional networks in their new cities. The size of the military has declined to less than 1% of the population, which means networks between military members are significantly smaller than they used to be. Veterans also have lower credit scores, on average, in part due to their late start in building credit compared with nonveterans.
We need to reduce the financial burdens on veteran-owned small businesses (VOSBs) by creating tax incentives such as reductions in sales tax and commercial property tax. Minnesota has a revolving loan fund of interest-free capital for veterans starting a business, but the pool has just $400,000. We encourage lawmakers to create similar funds with larger pools that can more realistically serve demand.
We need elected officials and civic leaders to celebrate veteran businesses. Shopping at VOSBs is a way for the community to support those who served. Other opportunities to promote and celebrate veteran entrepreneurs include asking veteran entrepreneurs to speak at civic and business events and on panels.
There are many organizations already supporting veteran entrepreneurs, like Bunker Labs, Patriot Boot Camp, WeWork’s Veterans in Residence program, and New York University’s Veterans Entrepreneurship Training program and Veterans Future Lab. Many of these organizations, including Bunker Labs, exist because of corporate partnerships, grant funding, and in some cases, as is true for NYU’s programs, support from lawmakers. We need to continue investment in the veteran entrepreneur ecosystem nationwide.
At the federal level, we support HR 1615, which aims to transfer the responsibility of verifying small business concerns owned and controlled by veterans or service-disabled veterans to the Small Business Administration — streamlining what is currently a daunting, challenging and monthslong process. Rep. Trent Kelly, R-Miss., a current brigadier general in the Army National Guard, proposed HR 1615. The bill was co-sponsored by Rep. Jason Crow, D-Colo., a U.S. Army veteran who served in Iraq and Afghanistan. It’s no surprise to us that a bill, which has the potential to revolutionize how veterans register their small businesses and qualify for large, competitive contracts, comes from veterans. To this end, we encourage more veterans to run for office, and for policymakers, regardless of veteran status, to meet with veterans to understand the issues they face.
Finally, to help veterans overcome the hurdle of accessing capital, we urge policymakers and constituents to support access to capital initiatives. Initiatives like the PenFed Veteran Entrepreneurial Investment Program (VEIP) can help veterans close the financing gap through veteran-owned small business loan programs.
Let’s take concrete actions that empower and enable veterans to build their own American dreams.
Dan Biga is a city leader for Bunker Labs’ D.C. Chapter and a Marine Corps veteran.