Access loans, mentorship and more to fund and grow your Veteran small business

Veterans own about 9% of all small businesses in the United States, employing 5 million people and producing around $1 trillion in sales. Yet bringing your idea to market and keeping your business going after starting up are not easy propositions.

Resources from the U.S. Small Business Administration (SBA) can help. Three SBA officials recently reviewed loans and other benefits you can receive as Veteran entrepreneurs. The SBA Veteran business development officers also answered questions from potential and existing Veteran business owners on ways to start, grow and expand an enterprise.

Fielding queries during the Nov. 10 webinar were Kim Donahue, branch manager with the Charleston, West Virginia, Branch Office; Mike Jackson, economic development specialist with the Minnesota District Office; and Jonathan Bennett, administrative officer with the Western Pennsylvania District Office.

Starting a Veteran-owned business

If you’re not already in business, start the process by developing a business plan, finding a mentor and getting training.

“One of the first things that I always recommend for anyone who is thinking about become an entrepreneur is reaching out to (SBA) resource partners,” Jackson said. “What you’re going to have to start working on is your business plan, and seeing if your product or service or idea is right for the market at this time.”

Business developers who start too soon can flounder, he said. “They’re going to be critically honest with you,” Jackson said. SBA resource partners research your idea and assist in creating strong business plans based on financial projections.

Most of the following partners offer a local or regional office and/or training option and virtual support:

Veterans Business Outreach Centers (VBOCs). If you’re a Veteran or a military spouse, the 22 VBOCs nationwide offer training and advice to begin, expand or purchase a new business. Details: Search for yours at https://www.sba.gov/local-assistance.

SCORE, Small Business Development Centers (SBDCs), Women’s Business Centers and the SBA Learning Platform. In addition to VBOCs, these are SBA partners offering low-cost mentoring, counseling and training. SCORE lets you access a network of business executives who provide free advice based on their real-world knowledge as Veteran business owners. And mentors match your industry — if you’re in the service sector, SCORE pairs you with that type of mentor. SBDCs provide locally based advice on topics such as regulatory compliance and trade; Women’s Business Centers customize advice for females. Visit the SBA Learning Platform for more business-related information. Details: https://sbavets.force.com/s/resource-network.

Boots to Business (B2B)/Boots to Business Reboot (B2BR). If it’s training you need, try an online or in-person Boots to Business or Boots to Business Reboot “Introduction to Entrepreneurship” training. B2B is for transitioning service members, including members of the National Guard and Reserves, and military spouses. The Reboot extends eligibility to Veterans as well. Once you’ve completed that course, get additional resources through a B2B Revenue Readiness online course, which is delivered for free by Mississippi State University in partnership with SBA. Details: https://sbavets.force.com/s.

Grow a Veteran-owned business

Opening a business often takes money, and loans are available. Here Jackson repeated the importance of having a strong business plan and related documentation.

“Any lender that you reach out to, that’s what they want to see,” he said. “They want to see what’s the return on investment for them, or what’s the risk.” He also said that your business plan should build in costs for a “BAIL team” — banker, accountant, information technology and insurance, and legal assistance. “They’ll bail you out of trouble,” Jackson said.

He suggested building relationships with lenders, and he reminded Veterans that you don’t have to stay with one lender.

There are four main SBA loan programs (but importantly, no grant funding):

General small business 7(a) loans. The most popular type of Veteran loan assistance is the so-called 7(a) Express loan, which waives the upfront guaranty fee on loans to 51% Veteran-owned small business. Loans are up to $350,000, 50% of which is guaranteed. Details: https://www.sba.gov/document/information-notice-5000-1955-fees-7a-loans-made-veteran-owned-small-businesses.

Microloans. These loans of $50,000 or less are provided through designated intermediaries to start up or expand small businesses and some nonprofit child care centers. Details: https://www.sba.gov/funding-programs/loans/microloans.

504 Loan. Get long-term, fixed-rate financing of up to $5 million through certified development companies for major fixed assets to promote business growth and job creation. Use these funds to purchase or construct buildings or land, new facilities, or long-term machinery and equipment. Details: https://www.sba.gov/funding-programs/loans/504-loans.

Disaster loans, including the COVID-19 Economic Injury Disaster Loan (EIDL). In the aftermath of a disaster, these SBA loans are for real estate, personal property, economic injury, machinery and equipment, and inventory. EIDL is no-collateral assistance of up to $25,000 for small businesses affected by COVID-19. If you’re a business owner within six months of a EIDL denial and can show a pre-Jan. 31, 2020, expense that you think qualifies, you have until Dec. 31, 2021, to file for “Reconsideration,” Donahue said. Details: SBA disaster loans, https://disasterloanassistance.sba.gov/ela/s and EIDL, https://covid19relief.sba.gov/#.

Expand a Veteran-owned business

Contracting through SBA is a way for you to expand your Veteran-owned small business (VOSB) or service-disabled VOSB. But Veteran-owned certification is only necessary for contracting with the federal government and not to declare that you own a business as a Veteran.

VOSB and SDVOSBs can self-certify within the SAM.gov system and elect not do business with the U.S. Department of Veterans Affairs (VA) or the Federal Aviation Administration (FAA), Bennett said. However, if you want to do business with VA or FAA, he said, “you would have to go through a formal verification process,” currently via VA’s website at https://vetbiz.va.gov/vip (a service that moves to SBA in January 2023).

Jackson recommended that you check with your state to see if it has any requirements for displaying signage as a Veteran-owned small business. Some states offer contracting opportunities for Veterans as well.

Veteran-owned small businesses program. As noted, if you are a Veteran or a service-disabled Veteran and own and control at least 51% of the business, you can become certified under the Veteran-Owned Small Business Procurement Program. Among other benefits, this program sets aside 3% of VA contracting opportunities to service-disabled Veteran-owned small businesses. Details: https://www.sba.gov/federal-contracting/contracting-assistance-programs/veteran-assistance-programs.

8(a) Business Development. This program is for socially and economically disadvantaged U.S. citizens whose net worth is less than $750,000. Details: https://www.sba.gov/federal-contracting/contracting-assistance-programs/8a-business-development-program.

HUBZone. This program is for small businesses located in a HUBZone and 51% controlled by U.S. citizens, community development corporations, agricultural cooperatives, Alaska Native corporations, Native Hawaiian organizations or Indian tribes. Details: https://www.sba.gov/federal-contracting/contracting-assistance-programs/hubzone-program.

Woman-owned small business program. Small businesses at least 51% controlled by women qualify under this program. Details: https://www.sba.gov/federal-contracting/contracting-assistance-programs/women-owned-small-business-federal-contracting-program.

Surplus property for Veteran-owned small businesses. If you’re verified as Veteran-owned, you may obtain surplus federal property located within your state. Details: https://www.sba.gov/federal-contracting/contracting-assistance-programs/veteran-assistance-programs#section-header-7.

Small Business Innovation Research and Small Business Technology Transfer programs. These highly competitive programs aim to encourage small businesses to engage in federal research and development that can be commercialized. Details: https://www.sbir.gov.

Procurement Technical Assistance Centers. These regional centers help with the contracting process. Details: Find yours at https://www.aptac-us.org/contracting-assistance.

Learn more:

Access and hear the presentation: https://sba.box.com/s/s9ejz0nulm83q8ld1o3h9sys4e594nmw and https://sba.box.com/s/jodbb3xy2f9j88mij6di1orcatc3y7qh.

SBA loan programs: https://www.sba.gov/funding-programs/loans.

SBA Veteran assistance programs: https://www.sba.gov/federal-contracting/contracting-assistance-programs/veteran-assistance-programs.