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As defined by the U.S. Department of Veterans Affairs (VA), a service-connected condition means an illness or injury that was caused by, or got worse because of, active military service. Veterans who have service-connected disabilities may encounter barriers, such as lack of education, insufficient funding, and access to clients, in addition to their disabilities. However, there are programs that knock down such barriers and assist veterans in starting their business.

Government programs and programs run by nonprofits help veterans pursue careers after service. Most of these programs are open to all veterans, while some are specific to veterans with service-connected disabilities. Keep in mind that these are just a sample of the programs available to veterans; more resources can be found on the VA “Careers and Employment” section.

Veteran Programs Bridge the Education Gap

The educational barrier is one of the most significant barriers faced by veterans with service-connected disabilities who desire entrepreneurship. The veteran may have a great business idea or aspiration to become a business owner but may not have the knowledge to turn those business concepts into reality. Here are several veteran programs that help bridge that education gap:

  • Veteran Readiness and Employment (VR&E)
    • The VA administers the VR&E self-employment track, which aims to help service-connected service members seeking to start a successful business. To qualify for VR&E, you must not have received a dishonorable discharge and have a 10% or greater disability rating from the VA.
    • The program provides coordination services and helps with developing a proposed business plan; analysis of your business concept; training in small-business operations, marketing, and finances; and guidance in getting the right resources to implement your business plan.
  • Veterans Business Outreach Center (VBOC)
    • The Small Business Administration (SBA) offers resources to all veterans, service members, and military spouses who are interested in starting or growing a small business. All veterans can apply at their regional VBOC offices.
    • VBOC provides boots to business classes, pre-business plan workshops, concept assessment, business plan preparation, entrepreneurial training and counseling, and mentorship, among other programs.
  • State Veteran Entrepreneur Programs
    • In addition to federal programs, many states have programs that veterans can use to bridge the education gap. For instance, the Veteran Entrepreneur Program (VEP) by the Texas Veterans Commission provides veteran entrepreneurs and small business owners with the tools to start or grow their businesses.
    • The VEP program is beneficial because it provides veterans with consultants and business management professionals to help them create and implement their business strategies. Veterans should research their state’s veteran programs to see what additional educational resources are available at the state levels.
  • Entrepreneurship Programs Run by Nonprofits
    • Many nonprofits offer educational programs geared towards helping veterans with entrepreneurial aspirations develop their concepts into viable businesses. One such organization is Warrior Rising, which has created a business academy training program for “Vetrepreneurs” to empower them through mentoring and coaching sessions, funding access resources, and accelerator programs.
    • Veterans can apply to Warrior University on the Warrior Rising website.

Veteran Programs Assist in Funding and Securing New Business

Access to funding and the ability to secure new business are additional barriers for veterans with service-connected disabilities who seek entrepreneurship.

The Department of Defense (DoD) has undertaken an outreach effort to identify small businesses owned and controlled by veterans and service-disabled veterans. The SBA has a veteran contracting assistance program for these veterans known as the Service-Disabled Veteran-Owned Small Business, or SDVOSB, program. The federal government aims to award at least 5% of all federal contracting dollars to SDVOSBs each year, and competition is limited for certain federal contract opportunities to businesses that participate in the SDVOSB program.

This is a massive benefit because it reduces the bidding pool for specific federal contracts favoring veterans with service-connected disabilities. Joining the SDVOSB program makes your veteran-owned business eligible to compete for the program’s set-aside and sole source contracts.

Click here to view all of the SDVOSB eligibility requirements, but two main requirements include fitting the SBA definition and size standard of a small business, and having no less than 51% of the business owned and controlled by one or more veterans rated as service-disabled by the VA. For veterans who are permanently and totally disabled and unable to manage their businesses’ daily operations, their businesses may still qualify if their spouse or appointed permanent caregiver assists in management.

State-level SBA and VA programs may also provide valuable resources to assist veterans in standing out in a crowded marketplace and earning the business of paying customers. For example, the Texas SBA issues Veteran Owned Business Certification to companies with 51% or more veteran ownership. Texas SBA® Veteran Owned Business Certification represents “pride in ownership”, verifies the company's ownership structure, and are a valuable certification because most Americans hold veterans in high esteem and would be willing to spend their money supporting veteran-owned enterprises. Most states have similar veteran certification programs such as the one in Texas. Veterans should check with their local SBA offices for more details.

The SBA business loan programs are additional sources of funding for veterans with service-connected disabilities. The SBA guarantees a portion of the loan, reducing the lenders’ risk and making it easier for small businesses to get the needed funding. SBA loans come in different varieties, but the SBA 7(a) loan program is particularly beneficial for veterans with service-connected disabilities who own a small business. Under the 7(a) loan program, small business owners can get up to $5 million if they are eligible through the following requirements:

  • Be an operating business (some businesses are ineligible);
  • Operate for profit and be located in the U.S.;
  • Defined as small under SBA size requirements
  • Not be able to obtain the desired credit on reasonable terms from non-federal, non-state, and non-local government sources; and
  • Be creditworthy and demonstrate a reasonable ability to repay the loan.

The SBA also runs the General Service Administration’s Surplus Personal Property for Veteran-Owned Small Business Programs in which veteran-owned small businesses can access federally owned personal property no longer in use and that the government no longer needs. Participating in the Surplus Property Program is a way for veterans with service-connected disabilities who own a small business to defray costs, enabling veterans with small businesses to obtain, among other things, surplus office equipment, furniture, and equipment, at little to no cost.

The GSA oversees the reuse and donation of federal personal property. SASPs (State Agencies for Surplus Property) manage surplus property disbursement. The SBA educates VOSBs (Veteran-Owned Small Businesses) on what is needed to participate in the program. The VSOB must be located and operated within the state; unconditionally owned and controlled by one or more eligible veterans, service-disabled veterans, or surviving spouses; and registered and in “certified” status in SBA’s Veteran Small Business Certification program database. Click here for all requirements for the Surplus Personal Property for Veteran-Owned Small Business Programs.

One additional funding opportunity to keep on the radar is a nonprofit, the Veterans Business Fund (VBF), established to provide veterans with the supplemental capital required to satisfy the equity requirements for a small business loan. The VPF is still securing the necessary funding to assist veterans in securing loans, but it should be fully operational soon to accept applications. The VBF provides capital to veterans in the form of a noninterest bearing loan with favorable repayment terms – business owners provide 50% of the necessary equity, while VPF supplies 50%. The VBF is supported by Syracuse University’s Burton Blatt Institute; the International Franchise Association’s VetFran Program; SCORE supported by SBA to provide counseling to small businesses; and many other organizations and programs.

Conclusion

Veterans, particularly those with service-connected disabilities, who own or aspire to own their businesses face unique obstacles. However, there are a myriad of programs out there specifically designed to help veterans overcome these obstacles and achieve their dreams of owning a thriving business enterprise. It is important to be aware of all the resources and opportunities that are available before launching your business venture.

About Our Author

Lance Felicien, a financial services attorney at Adams and Reese, served for 10 years in the U.S. Army, including holding the rank of Captain. Lance earned the Bronze Star Medal for his service during the war in Afghanistan. He supervised more than 100 soldiers and commanded a field maintenance company capable of worldwide deployment in response to conflicts across the globe. Lance is based in the law firm’s Houston office, and his practice primarily consists of advising financial institutions on legal process compliance and deceased customer operations, and representing corporate clients in a varied array of practice areas, including litigation, insurance coverage, construction, professional liability, and tort and catastrophic loss.

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