NEW YORK (AP) — Many veterans who have started small businesses tell a similar story: Their military service prepared them mentally for the task, but they were at a financial disadvantage.
Vetrepreneurs (veterans who start small businesses or startups) own nearly 2 million small businesses that employ 5.5 million people in the United States, according to the Small Business Administration. They receive about $1.3 trillion in revenue annually. However, their numbers have declined as the veteran population has aged. In a 2023 report, the SBA found that veteran ownership decreased from 11% of businesses in 2014 to 8.1% in 2020.
Veterans enter the business world prepared with the skills they acquire in the field, such as leadership and problem solving. But they haven’t had the opportunity to build up credit or savings that civilians have had more time to do. That can cause problems because banks use that information to approve loans. Not to mention the mental toll that comes with transitioning from military life to civilian life.
According to data from SCORE, a nonprofit business coaching organization, about a third of veteran companies have limited access to capital or lack of financing. That compares to a quarter of businesses owned by non-veterans.
Bridget Weston, executive director of SCORE, says the good news is that veterans have many places to turn for help. These include nonprofit organizations aimed at helping veterans recover and develop financial literacy, loans and grants exclusively for veterans, and contracts targeting small businesses owned by veterans and disabled veterans.
The place many start is the Small Business Administration, which offers a program to become certified as a veteran-owned or disabled veteran-owned small business, which can make it easier to obtain certain federal loans and contracts.
That’s the route Jackson Dalton decided to take when he founded Black Box Safety, a personal protective equipment manufacturer, in 2017. Dalton enlisted in the U.S. Marines in 2000 and was selected for the prestigious Special Operations Corps. Marines. But a severely broken leg, suffered during training, eventually forced him to medically retire after two years of active duty.
Although the transition back to civilian life was difficult, Dalton earned a master’s degree in public health and spent 10 years working in the health and safety industry. When he ventured out on his own, he decided to focus on federal contracts and became SBA certified. He thought prisons would be a good place to start, since 3% of his contracts go to disabled veteran businesses. His first contract was selling gloves to a Minnesota prison. Today it serves major clients such as the Department of Veterans Affairs and the State of California.
Dalton attributes his success to his military training.
“The skills and attributes that I acquired in the military were resilience and courage and the ability to adapt, improvise, overcome when you know, when I encounter resistance or obstacles and barriers,” he said.
Veteran-focused nonprofits can be another key place to look for help.
Adam Isch, a Marine Corp. veteran who served two tours in Iraq, worked with the nonprofit Warrior Rising in Salt Lake City to find a mentor to help him start his business, Isch Body Works in Fort Worth. Texas, which sells male hygiene products. . The company donates a portion of its proceeds to charities that support Texas children in foster care and awaiting adoption. Similar nonprofits include Bunker Labs, Tactical Launch, and others across the country.
“Anyone who wants to start a business, especially a veteran, look for a group like Warrior Rising, there are all kinds of different groups like that that get mentored,” he said. “There are people who are doing what you do. “They are doing what I do, they love it and they want to talk about it.”
For some, a loan intended for veterans can be what makes or breaks a business. Elizabeth Gore, co-founder and president of Hello Alice, a financial technology company that works with small businesses to obtain financing, including 117,000 military small business owners. “They really have to fight harder than other groups and demographics for access to capital,” he said.
John Griveas in Buffalo, New York, spent two years as a Navy Seal in the mid-1990s and the remaining four years in New York in the active reserves, ending his tenure in 2002. After that, he “bounced around” at different jobs and 10 years passed. in the local collections industry.
But in 2014 he met his current partner, Jackie, and decided that his hobby of making all-natural dog treats could become a real business. They formed Search! Dog Treats as an LLC in 2015 and today sell their treats in around 300 independently owned family-owned brick-and-mortar stores, convenience stores, banks, and even the Venetian Hotel on the Las Vegas Strip.
For him and other veterans he has spoken to, one of the biggest challenges they face is getting funding. She found a $10,000 grant through the FedEx Entrepreneur Fund, which partners with Hello Alice to provide grants to small businesses owned by military veterans. It came at a crucial time, when the owner decided to remodel his space and gave him just a few months to find a new location.
“It was something that was literally going to wipe us out,” he said. “And when that grant came in, it was literally a lifesaver for us.”
He advised other veterans to take advantage of veteran resources.
“There are tons of resources available,” he said. “Whatever you know, it will help you get through the day, because there are a lot of things involved in running a business.”