Veterans have proven themselves to be among the country’s best entrerpeneurs, starting major companies such as Fed Ex, Nike and Walmart.
But if you’re a veteran who wants to be your own boss, it may not be obvious how to get started.
Military Times reached out to federal agencies, veteran support groups and private companies, asking what advice they would give to aspiring veteran entrepreneurs.
Here’s what they told us:
1. Take advantage of the help available to you
Vets who want to start their own businesses can run into a unique problem: There are so many programs and resources out there to help, they may not know where to start.
Misty Stutsman, director of entrepreneurship at Syracuse University’s Institute for Veterans and Military Families, said there are several hundred programs developed to help vets start their own businesses.
“There’s a huge navigation issue that veterans are now facing,” she said. “With all of those resources, you can kind of spin your wheels.”
Stutsman suggested that vets start by finding local groups and resources, as well as consulting their network of fellow vets to see what groups they found most helpful.
The military’s transition assistance program, or TAP, includes a section focused on entrepreneurship called Boots to Business, which can help vets learn the basics of entrepreneurship and get a grasp on the support programs available to them. Vets who have already separated from the military can get a version of this training by signing up for its sister program, Boots to Business Reboot.
2. Check out the Small Business Administration
You’ve probably heard about business owners frustrated with government rules and regulations, but did you know that there’s an entire government agency dedicated to helping small business owners?
The Small Business Administration has hundreds of Small Business Development Centers scattered across the country, as well as nearly two dozen Veterans Business Outreach Centers catering to veterans and others with ties to the military.
“SBA has this amazing myriad of resources,” Stutsman said.
Larry Stubblefield, associate administrator for SBA’s Office of Veterans Business Development, said his organization can help veterans find mentors, navigate lenders, learn how to market themselves and much more.
“We have 22 Veterans Business Outreach Centers located around the country,” Stubblefield said. “They’re like a one-stop shop for transitioning service members, veterans, military spouses.”
And the cost is already covered by your tax dollars, typically.
“The vast majority of our resources are free to the recipient.”
3. Find a mentor
“The folks who go out and connect … you’re much more likely to be successful than going at it alone,” Stubblefield said. “Entrepreneurship is definitely a team sport.”
If you know fellow vets who started their own businesses, reach out and ask them for advice. If you don’t, look into the SCORE program, a volunteer initiative associated with SBA that helps vets find business mentors.
“SCORE’s been around 56 years, now, and it’s what is called a resource partner of the SBA,” said Jay Gladney, a certified SCORE mentor. “We actually extend their … personnel resources to allow them to better serve SBA clients.”
SCORE connects budding entrepreneurs with mentors who have successfully grown their own businesses, often in the same field. The mentors can help budding entrepreneurs hone their ideas, improve their pitches to lenders and plan for growth and next steps.
There are 348 SCORE chapters throughout the U.S., and you can search for mentors online, as well as viewing SCORE entrepreneurship webinars and courses.
4. Research and test your idea
“There are very few brand-new ideas out there,” Gladney said.
But the fact that someone has probably already tried your business idea in some form can work to your advantage – it gives you the opportunity to learn from their successes and failures.
“Learn as much as you can about the industry, the product and the service that you’re going into, so that you’re going in with a much better possibility of success,” Gladney said.
Gladney and other entrepreneurship experts told Military Times that it is important to make sure that your idea has enough target consumers who are eager to buy what you’re trying to sell. This probably means doing more than just asking your friends and family what they think.
Gladney suggested that entrepreneurs create surveys using free online tools to help them better understand what the consumers they’re targeting really want.
“You can actually create a small survey to ask people about what it is that you’re creating, whether they would be interested in buying that, and even ask them the price points,” he said.
5. Build a business plan
You’ve surely heard that you need to make a business plan before you launch your own company. But what exactly is a business plan?
You should be making a “fairly robust document” in the range of 15 to 20 pages, Gladney said. And it’s important that you physically write it out, rather than just having a vague sense of it in your head.
“Getting it written down is important, because it forces them to be specific and to make it make sense,” he said.
Ask your network of mentors and advisors to help.
And once you write the plan down, it doesn’t become an infallible document that should never be changed again, said Stutsman of Syracuse’s IVMF.
“A business plan becomes a living document,” she said. “ It’s not something that’s set in stone.”
Stutsman said that business owners should go back to their mentors and advisors, even long after getting their businesses off the ground, for advice and help adjusting their business plans to meet changing conditions.
6. Figure out financing
Launching a business will require money. Depending on your business, it could be a lot, or it could be a relatively modest amount. But regardless, you’re probably going to need to find a lender.
One of the first things that any lender will want to see is a business plan and market research that shows that your idea is viable.
“Lenders are going to be looking at that,” said SBA’s Stubblefield. “They’re not just going to, you know, hand you money.”
Even once you have all that material together, chances are that you’ll still have a hard time getting a loan by just walking into your nearest bank.
“Banks are generally a little difficult for startups,” said SCORE’s Gladney. “There’s no track record for success of the business for a startup, and so therefore the bank has less data on which to evaluate the risk that they’re taking.”
That can lead to a lot of rejections. Instead, you may want to start with special lenders dedicated to helping small businesses, such as lenders associated with The Community Development Financial Institutions Fund, or CDFI Fund.
Another great resource is the SBA’s Lender Match program. Just fill out some forms online and the service connects you with possible funding sources, all of which have been approved by the SBA.
7. Talk with your family
Your personal and family finances – credit scores, debt, collateral, etc. – will affect your ability to get a business loan, Gladney said.
And of course, the inverse is true as well: Whether your business succeeds or fails will have a big impact on your family’s financial situation. So starting your own business needs to be a family decision.
“You absolutely must have … partner/family buy-in, or you’re doomed to fail,” said Janet Harris, director of recruitment for Dream Vacations, a franchise brand that helps entrepreneurs launch their own travel businesses.
One way to minimize your personal financial risk is to start slow, said Stutsman of Syracuse’s IVMF.
“Don’t quit your day job … Don’t cash out your 401k on an idea,” she said. “It’ll take a while to get to cash flow. It’ll take a while until you can take an income without hurting your company.”
In addition, Gladney recommended setting up a separate legal structure for your company, such as an LLC, so that the company bears more of the financial risk, not you. But even if you take all these steps, starting your own business is still a big risk.
“You have to assume the risk if you want the reward,” Gladney said.
8. Consider franchising
Starting a business from scratch will require you to do marketing, accounting, website building and much more. Are you an expert in all of those areas? Are you ready to pay someone else to help?
If not, franchising might be a great option.
“If you have a franchise, it’s like a box with a big bow on top,” said Janet Harris of Dream Vacations. Inside that box, you’ll find marketing, accounting, training and other help.
Of course, that help comes with extra cost.
SBA’s Stubblefield said that while franchisees can typically expect “a lot of support from corporate headquarters,” they are also likely to have much steeper startup costs.
Franchisees also typically have monthly franchise fees, or royalties, marketing expenses, material costs and other ongoing expenses.
That said, the franchise system is often a very good fit for veterans, Harris said.
“Franchising is a road map, so you follow that road map to success, which is also what … men and women in the military do,” she said. “That makes them very comfortable, and it also gives them more confidence.”
VetFran, a branch of the International Franchise Association, has online advice and resources for veterans interested in franchising.