About 1 in 10 veterans owns a business, according to the U.S. Small Business Administration. There are more than 300,000 veteran-owned companies in the United States, which employ nearly 6 million individuals.
Veteran-owned companies fall under the category of a diverse business. As such, they face unique challenges when it comes to launching, operating and growing a business, such as getting veteran-owned business certification. While roughly 6 percent of U.S. businesses are owned by veterans, this number falls in sharp contrast to the number of World War II and Korean War veterans who went on to own or operate a business (49.7 percent and 40 percent, respectively), according to U.S. Veterans Magazine.
Here are a few of the barriers that prevent veteran entrepreneurs from starting businesses or accomplishing their business goals:
- More financing challenges. According to the U.S. Small Business Association, veteran-owned businesses have less access to funding than do other businesses. A recent SBA report found that veteran loan applicants had lower approval rates and were less likely to receive the amount of credit they sought.
- Hiring stigma. Research has found that businesses are less likely to hire or partner with veterans because of stigmas around things like physical disabilities and post-traumatic stress disorder. One study found that veterans with PTSD were significantly more stigmatized, which led to hiring discrepancies.
- Mental health and addiction. Veterans are disproportionately more likely to struggle with mental health issues and addiction than are non-veterans. About 41 percent of veterans have a mental health need, while more than 1 in 10 have been diagnosed with a substance use disorder. Personal challenges like these can be a barrier to successful entrepreneurship, especially if adequate mental health and medical care is not available.
Despite these challenges, veteran-owned businesses play a significant role in our economy and contribute a valuable perspective and skillset. According to one veteran and Forbes contributor, John Nicholson, veteran-owned businesses may be especially qualified to help strengthen the economy and avoid crisis. This is because “those who have gone to war are trained in the art of responding to what are known as VUCA (volatile, uncertain, complex and ambiguous) environments,” according to the article.
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