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Make Sure You Know The Financial Risks Before Starting Your Own Business
A quick review of recent articles about veteran employment shows a significant uptick in interest concerning entrepreneurship. In the last seven weeks alone, no less than seven articles found their way into popular outlets touting opportunities for veterans to learn how to start their own business. Headlines like “Vets bring DIY attitude to business startups,” “Unleashing The Entrepreneurial Potential Of Veterans,” and “Texas Academy Helps Veterans Launch Small Businesses” reflect the enthusiasm behind the recent trend.
No doubt veterans have many of the character traits found in successful entrepreneurs. Determination, resilience, and flexibility ensured mission accomplishment, earned them promotions and awards, and kept today’s veterans alive on the battlefield. These same traits serve well in the small business world whether starting a new venture, acquiring an existing business or buying a franchise. Fred Wellman articulated it best in his recent Task & Purpose article on the lessons the Army taught him about running a small business.
This uptick in interest and attention even found its way into the halls of Congress this summer when the Senate Small Business Committee introduced the Veterans Small Business Ownership Improvements Act of 2015 to inject more than $10 million into business training and services for veterans. While the future of the bill remains uncertain, it signals continued support of veteran entrepreneurs within the federal government.
Recent changes in the Department of Defense’ Transition Goals, Plans, Success now include an introduction to entrepreneurship, as well as a separate track for service members considering this career option following military service. Delivered by a Small Business Administration resource partner, the entrepreneur course, Boots to Business, provides an overview of business ownership, methods for identifying opportunities, and some of the pros and cons relating to business ownership. If after this two-day introductory course service members are still interested, they can enroll in an eight-week online course to help them dive deeper into business-plan development, market research, financing, risk management, accounting, human resources, etc. As a Boots to Business graduate and an entrepreneur myself, I can attest to the value of the training provided.
Stories of veterans, like Fred Smith who founded FedEx or Dave Liniger who founded RE/MAX, are shining examples of success among the 2.4 million American businesses operated by veterans, according to the Small Business Administration’s 2012 report. While these outliers give veterans role models to emulate and lofty goals to achieve, they may underplay the hard work ahead for budding business owners.
Despite energy and enthusiasm, success rates for small businesses are pretty daunting. According to the Small Business Administration, only 50% of small businesses survive five years or more, with about one-third making it to the decade milestone. Leading causes of failure often include “no knowledge of financing requirements and conventions, lack of planning, [and] unbalanced experience or lack of managerial experience.” Sure, the training offered through the Boots to Business program or other training courses at community colleges help veterans gain insights into some of the difficult work ahead. These courses help build a business plan, complete market research and may even help identify investors, but when the business struggles to generate revenue, who will be there when investors or lenders come calling?
Similarly, there are little or no benefits packages associated with starting your own business. Startups often can’t afford to offer benefits packages that include health insurance, life insurance, etc. As a result, veterans and their families may be taking significant personal risks.
So, how do we offer opportunities to service members, spouses, and veterans who are seeking entrepreneurial careers without putting them at undue risk for failure, debt, and even bankruptcy? Here are some ways defense officials, members of Congress, and vets interested in creating their own opportunities can keep this enthusiasm moving forward:
Continue teaching entrepreneurial rewards and risks during transition courses.
Business ownership for most owners is a marathon, not a sprint. It’s important to emphasize the challenges of owning your own business so veterans don’t enter the market unaware. It helps when the instructor has been or still is a small business owner, most of whom failed once or twice before getting it right. By focusing on the personal sacrifices and risks, coupled with realistic rewards, veterans and spouses can enter this arena with both eyes wide open. Part of these education efforts should connect prospective business owners with existing owners and their lessons learned. Command Your Business offers insights from 70+ veteran entrepreneurs in their resource report.
Don’t test the depth of the water by jumping in with both feet.
Encourage veterans toward business ownership as a parallel track to working full time. By exploring the feasibility of a particular business model as a part-time venture, veterans can provide for their family while holding down a full-time job. Several resources offer advice on this approach and even help entrepreneurs calculate when it’s safe to flip to full-time business ownership. Here’s one from Ryan Robinson who helps entrepreneurs launch careers. And it helps if veterans connect into support networks or incubators like Small Business Administration, SCORE, or a recent organization with promise, The Bunker.
Emphasize areas of higher success, lower risk.
Startups are exciting, but risky. In many cases, the owner is testing a theory that may or may not be fully informed by solid market research. Buying an existing business (with a proven track record) or buying into a franchise (that offers benefits, training and safety nets) allows veterans to explore their entrepreneurial interests with much less risk. Military Times recently published the top 42 franchises that offer benefits to veteran owners, including reduced or waived franchise fees.
With a healthy dose of caution, proper training, mentorship, and active support networks, veterans and military families can pursue their dreams and passions while ensuring unnecessary risks are minimized.
To leaders in education and government, ensure safety nets are available and realistic expectations are emphasized during every step of the transition process.
To my fellow veterans, pursue the dreams of your life, but just like you did while wearing the uniform, develop a solid plan, and prepare for it to crumble on first contact with adversity. When it does, dust yourself off, shoulder up to your mentors, and get back into the fight.
A Marine wanted for killing his mother's boyfriend reportedly escaped police by hiding inside an RV they'd spent hours searching before towing it to a parking lot, where he escaped under the cover of darkness.
It wasn't until more than two weeks later authorities finally caught up to Michael Brown at his mom's home, which was the scene of the crime.
Brown stuffed himself into a tight spot in his camper during an hours-long search of the vehicle on Nov. 10, according to NBC affiliate WSLS in Virginia. A day earlier, cops said Brown fatally shot his mother's boyfriend, Rodney Brown. The AWOL Marine remained on the lam until Nov. 27, where he was finally apprehended without incident.
No motive is yet known for last week's Pearl Harbor Naval Shipyard shooting tragedy, which appears to have been a random act of violence in which the sailor who fatally shot two civilian workers and himself did not know them and did not plan his actions ahead of time, shipyard commander Capt. Greg Burton said in an "All Hands" message sent out Friday.
Machinist's Mate Auxiliary Fireman Gabriel Antonio Romero of San Antonio, an armed watch-stander on the attack submarine USS Columbia, shot three civilian workers Dec. 4 and then turned a gun on himself while the sub rested in dry dock 2 for a major overhaul, the Navy said.
"The investigation continues, but there is currently no known motive and no information to indicate the sailor knew any of the victims," Burton said.
SEOUL (Reuters) - North Korea said it had successfully conducted another test at a satellite launch site, the latest in a string of developments aimed at "restraining and overpowering the nuclear threat of the U.S.", state news agency KCNA reported on Saturday.
The test was conducted on Friday at the Sohae satellite launch site, KCNA said, citing a spokesman for North Korea's Academy of Defence Science, without specifying what sort of testing occurred.
Since the Washington Post first published the "Afghanistan papers," I have been reminded of a scene from "Apocalypse Now Redux" in which Army Col. Walter Kurtz reads to the soldier assigned to kill him two Time magazine articles showing how the American people had been lied to about Vietnam by both the Lyndon Johnson and Richard Nixon administrations.
In one of the articles, a British counterinsurgency expert tells Nixon that "things felt much better and smelled much better" during his visit to Vietnam.
"How do they smell to you, soldier?" Kurtz asks.
WASHINGTON (Reuters) - Erik Prince, the controversial private security executive and prominent supporter of U.S. President Donald Trump, made a secret visit to Venezuela last month and met Vice President Delcy Rodriguez, one of socialist leader Nicolas Maduro's closest and most outspoken allies, according to five sources familiar with the matter.