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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.
29 years after Desert Storm, an Air Force general says we’ve forgotten the lessons that made it so successful
When Air Force Gen. Chuck Horner (ret.) took to the podium at the dedication of the National Desert Storm and Desert Shield Memorial site in Washington D.C. last February, he told the audience that people often ask him why a memorial is necessary for a conflict that only lasted about 40 days.
Horner, who commanded the U.S. air campaign of that war, said the first reason is to commemorate those who died in the Gulf War. Then he pointed behind him, towards the Vietnam Veterans Memorial, where the names of over 58,000 Americans who died in Vietnam are etched in granite.
"These two monuments are inexorably linked together," Horner said. "Because we had in Desert Storm a president and a secretary of defense who did the smartest thing in the world: they gave the military a mission which could be accomplished by military force."
The Desert Storm Memorial "is a place every military person that's going to war should visit, and they learn to stand up when they have to, to avoid the stupidness that led to that disaster" in Vietnam, he added.
Now, 29 years after the operation that kicked Saddam Hussein's Iraqi army out of Kuwait began, the U.S. is stuck in multiple wars that Horner says resemble the one he and his fellow commanders tried to avoid while designing Desert Storm.
Horner shared his perspective on what went right in the Gulf War, and what's gone wrong since then, in an interview last week with Task & Purpose.
The Navy SEAL accused of strangling Army Special Forces Staff Sgt. Logan Melgar was promoted to chief petty officer two months after Melgar's death, according to a new report from The Daily Beast.
The number of major aviation mishaps and associated fatalities among U.S. service members across all four main branches fell dramatically in fiscal year 2019, according to data reviewed by Task & Purpose, a sign of progress amid growing worries of a crisis in U.S. military aviation.
The U.S. military saw 42 Class A mishaps and just 13 related fatalities in fiscal year 2019 across the Army, Navy, Marine Corps, and Air Force, well below the U.S. military's six-year high of 52 incidents and 39 deaths in fiscal year 2018.
When it comes to saving the world, sometimes one uniform just isn't enough. At least, that's what seems to motivate Tech. Sgt. Sean Neri, who, in between coordinating vehicles for security forces at Malmstrom Air Force Base, Mont., dresses up as a Star Wars bounty hunter and volunteers at community fundraisers.
"One of my coworkers introduced me to costuming and showed me there are organizations out there who use it for charity work," said Neri in a Jan. 21 article by Devin Doskey, public affairs specialist for the 341st Missile Wing.
"As a cop, I love being able to help people, but upon discovering I could do it while being a character for Star Wars, I was hooked," said Neri, who is the NCO in charge of vehicle readiness for the 341st Security Forces Support Squadron.
March Air Reserve Base in California will host nearly 200 U.S. citizens who were flown out of Wuhan, China due to the rapidly-spreading coronavirus, a Defense Department spokeswoman announced on Wednesday.
"March Air Reserve Base and the Department of Defense (DoD) stand ready to provide housing support to Health and Human Services (HHS) as they work to handle the arrival of nearly 200 people, including Department of State employees, dependents and U.S. citizens evacuated from Wuhan, China," said Pentagon press secretary Alyssa Farah in a statement on Wednesday.
Wuhan is the epicenter of the coronavirus, which is a mild to severe respiratory illness that's associated with symptoms of fever, cough and shortness of breath, according to the Centers for Disease Control and Prevention.
The virus has so far killed 132 people and infected nearly 6,000 others in China, according to news reports.