National Invest In Veterans Week®A Reflection on Veteran Advocacy 2017-2024
National Invest In Veterans Week® originated in 2019, conceived by Jeff Shuford, an Iraq War veteran and the founder of the acclaimed technology brand, Tech From Vets, established in 2016. Shuford's venture gained prominence when it was awarded the Biztech Award by Comcast Business in 2017, recognizing it as a leading veteran-focused company. To assess the state of veteran-owned businesses in Northeast Florida, home to the largest veteran population in the United States, Shuford initiated the Jacksonville Vetrepreneur Summit in collaboration with the City of Jacksonville, Florida. The insights gleaned from Shuford's comprehensive surveys in 2017 and 2018 shaped the objectives and aspirations of the congressionally recognized National Invest In Veterans Week®. This initiative, developed in cooperation with the City of Jacksonville, Florida, opens up numerous avenues for legislative, economic, and community support for veteran entrepreneurs.
Given the vast array of data from 2017 to 2023 collected by researchers like Shuford’s National Invest In Veterans Week® concerning veteran entrepreneurship, a story of resilience, adaptation, and undeterred ambition emerges—a narrative that intertwines the challenges of capital access with the indomitable spirit of veterans turning to business ownership as a new battlefield.
2017-2018 A Decline and Resurgence: The Shifting Sands of Veteran Entrepreneurship
In 2017, the findings from Jeff Shuford's survey of veterans at the Jacksonville Vetrepreneur Summit unveiled critical insights into the barriers veteran entrepreneurs faced. The survey revealed that a vast majority, 81%, felt a pressing need for additional support in their entrepreneurial endeavors, while 67% highlighted the crucial requirement for more funding to sustain and grow their businesses. Furthermore, 37% identified the lack of access to capital as their primary obstacle, and 27% pointed to a deficiency in knowledge or experience as a significant hindrance. There was a clear call among respondents for enhanced information regarding funding sources and strategies to manage start-up costs effectively, alongside a strong desire for increased networking opportunities with fellow veteran entrepreneurs.
This period also witnessed a notable downturn in veteran entrepreneurship, as detailed by the 2018 report from the Federal Reserve Bank of New York and the SBA. Traditionally, veterans had been more inclined towards self-employment, thanks to their adeptness in leadership, discipline, and crisis management acquired during military service. Yet, this propensity began to wane, resulting in a decline of veteran-owned businesses to levels that sometimes fell below those of their nonveteran counterparts. The rate of veteran self-employment, which stood at 16% in 1998, experienced a downturn to 11% by 2018, reflecting a divergence from the once prevalent trend of transitioning military skills into successful civilian entrepreneurial ventures.
2021 The Pandemic's Silver Lining: A Surge in Veteran Entrepreneurship
The next round of data for veteran businesses emerged with 2021 shown as an extraordinary year for U.S. entrepreneurship, witnessing over 5.4 million new business starts, among which veterans played a significant role. The year's challenges, coupled with economic uncertainty, seemingly catalyzed a remarkable 100% increase in veteran entrepreneurship from the 5.4% reported in 2019 to 10.7% in 2021. This surge in veteran-led businesses is not just a statistic; it represents a substantial shift towards self-reliance and economic contribution amidst adversity.
Unpacking the Motivations
Veterans' motivations for embarking on entrepreneurial ventures in 2021 provide a window into the compounded pressures and opportunities of the time. A significant 48% of veterans cited financial worries as their primary motivator, reflecting the economic strains imposed by the pandemic. Furthermore, 27% ventured into business ownership due to job loss, and 24% sought to capitalize on pandemic-related business opportunities. This data underscores a crucial narrative: veterans were more inclined to start businesses out of economic necessity, compared to non-veterans. The entrepreneurial spirit, thus, emerged as a coping mechanism and a strategic pivot during uncertain times.
Industry Choices and Success
The industries chosen by veteran entrepreneurs also tell a story of strategic alignment with market demands. A striking 47% of veteran entrepreneurs ventured into Goods-Producing/Logistic sectors, such as construction, manufacturing, and transportation, significantly higher than the 11% among non-veteran business owners. This choice reflects not only the veterans' inclination towards industries where they can leverage their logistical and operational expertise but also their ability to identify and respond to market needs during the pandemic.
Moreover, this sector choice paid off, with many veteran-owned businesses in these areas reporting better-than-expected performance. This success rate, 46% for veterans versus 41% for non-veterans, underscores the efficacy of veterans' strategic decisions and their resilience in navigating the business landscape under challenging circumstances.
By 2023, however, data from Gusto's survey revealed a significant shift. Despite ongoing challenges, particularly in access to capital, veteran-owned businesses were making a remarkable impact on the U.S. economy. They owned 305,000 businesses, employing 3.3 million workers and contributing $180 million in annual wages. This rebound was not uniform across the country; certain regions, especially in the South and West, saw higher concentrations of veteran-owned businesses, with cities like Virginia Beach and Atlanta becoming notable hubs.
The resurgence in veteran entrepreneurship by 2023 can be partly attributed to a significant increase in the number of new businesses started by veterans in 2021, doubling from the rates observed in 2019. This surge was driven by veterans seizing pandemic-related business opportunities, coupled with financial insecurities and job losses. Despite the positive trends in business starts and growth, veterans continued to face unique challenges, particularly in financing their ventures. They were less likely to access private capital compared to non-veterans, relying more on personal savings and public funding sources like SBA-backed loans and government stimulus programs.
This period also saw an evolving landscape of motivations for veterans turning to entrepreneurship. The desire for flexibility, financial stability, and seizing business opportunities were among the top reasons veterans started new businesses. They showed a strong preference for sectors that serve the community, such as Health Care, Education, and Non-Profits, underscoring their ongoing commitment to service beyond their military careers.
The story from 2017 to 2023 is one of adaptation and perseverance. Despite facing a more challenging environment for access to capital and navigating a decline in veteran entrepreneurship rates, veterans demonstrated remarkable resilience. By leveraging their unique skills and experiences, they continued to make substantial contributions to the economy and their communities, embodying the spirit of service in their entrepreneurial endeavors.
Sources:
https://gusto.com/company-news/veteran-businesses-growing-2022
https://gusto.com/company-news/entrepreneurship-among-military-veterans-in-2023
https://www.investinveteransweek.com/research-veteran-entrepreneurship