by James Eide, Bunker Labs RDU City Leader — November 1, 2019 .
Editor’s Note: James Eide is Bunker Labs RDU City Leader. As we near Veterans’ Day, Eide talks about entrepreneurship and veterans.
RESEARCH TRIANGLE PARK- The Research Triangle has long been a hub of innovation and in recent years it’s garnered attention as a top region for startups nationwide. Inc. Magazine ranked it third in a list of “surge cities” in 2018, calling it a “booming and brainy startup scene.” In 2018, WalletHub ranked Durham-Chapel Hill as the fourth most educated metropolitan area in the country (Raleigh ranked 13th), and in recent years startups like Pendo have closed large rounds of funding (Pendo, a Raleigh-based software company, has raised more than $100 million and expects to add 590 jobs in the next five years).
Meanwhile, the broader region is also home to many military bases, including Fort Bragg which is just over an hour to the south. The Raleigh-Durham area has one of the state’s largest veteran populations by numbers and Fayetteville, the city encompassing Fort Bragg, has the highest percentage of veterans in the state at 19 percent of the population.
The Raleigh-Durham area may be a great place for startups, but is it a great place for veteran-owned startups?
Veteran entrepreneurship rates nationwide are at historic lows. After World War II, 49.7 percent of returning veterans owned and operated a business. For Korean War veterans, that number was 40.1 percent. More than 60 years later, only 4.5 percent of post-9/11 veterans have started their own business.
Despite the decline, nearly one in four veterans said they were thinking of starting a business in a 2004 study conducted for the Small Business Administration. If not lack of interest, what’s causing veterans to turn away from entrepreneurship? I believe the decrease is due to obstacles such as barriers to financing, lack of resources, and dwindling professional networks, all of which we can change. There’s no better place to start than here in Raleigh, and there’s no better time to start than Veteran’s Day, when we as a community stop to recognize veterans.
Veterans enlist in the military to serve and protect the American people. We can and should take steps to make sure they can realize their own dreams when they return from service. Not only does honoring veterans’ futures honor their past service, increasing veteran entrepreneurship has a positive impact on the economy. Households with veterans who own businesses have higher incomes and wealth than those with veterans who do not. According to a 2014 study by the Franchise Business Review, veterans are 30 percent more likely to hire other veterans, which increases the number of jobs available for returning veterans who do desire traditional employment. And entrepreneurship provides the opportunity for service-disabled veterans who cannot work in traditional jobs an opportunity to pursue and an independent and meaningful career.
As American civil rights activist Marian Wright Edelman famously said, “You can’t be what you can’t see.” The majority of veterans transition from military service to traditional employment, and taking a corporate job seems like a trusted, safe choice. We need to diversify our narratives to show that entrepreneurship is accessible and rewarding as well.
As an example, consider Bandwidth, a telecommunications platform provider founded by Marine veterans David Morken and John Murdock. Bandwidth’s customers include Google and Skype, and the company went public in 2017. Since its November 2017 IPO, the stock has grown from its IPO price of $20 per share to more than $60 per share Durham-based Spiffy is another local success story. The car wash and detailing service that comes to you was founded by former Army Infantry Officer and Ranger Karl Murphy in 2014. Spiffy has raised over $28 million in funding to continue rolling out its services across metropolitan areas nationwide. Showcasing the veterans at the forefront of companies like Bandwidth and Spiffy can inspire the next wave of veteran entrepreneurs. If you’re building a speaker panel or choosing a keynote speaker, consider asking a veteran entrepreneur to share their story and how their experience as veterans informed their success as entrepreneurs.
Second, we need to equip veterans with tools and resources they need to get started. Most of the resources for transitioning military service members are geared toward traditional employment, and entrepreneurship can feel like a black box. Confounding matters, what an entrepreneur needs on day one is radically different from what they need on day 60. Given that approximately one in four veterans is interested in starting a business, for every three dollars we spend on veteran employment programs we should spend one dollar on entrepreneurship programs. We also encourage organizations to partner with groups that train and equip veteran entrepreneurs.
Finally, we need to connect aspiring veteran entrepreneurs to robust networks. Fifty percent of veterans relocate to a city other than their hometown after completing their military service, which has an inevitable impact on the size and strength of their professional networks. With only one percent of Americans joining the military, the pool of possible connections between veterans is also shrinking. The need to help military veterans build strong networks and bridge the veteran-civilian gap is pressing. If you know a veteran looking for a network of peers, tell him or her about organizations like Bunker Labs, which provides entrepreneurship education and builds entrepreneurial ecosystems for veteran and military spouses, and the SBA’s Veteran’s Business Outreach Center. I encourage business and civic leaders to reach out to veterans and invite them to join in the conversations and events that shape our community.
Veterans want to be entrepreneurs, and they’re well suited for the challenge. Research has shown that veterans have skills that are important for entrepreneurial success, including creativity, willingness to take risks, and leadership ability. As a community, it’s our role to ask how the Research Triangle can encourage interested veterans to pursue entrepreneurship and support them along the way.