Key Insights from the 2021 National Survey of Military-Affiliated Entrepreneurs

The National Survey of Military-Affiliated Entrepreneurs is a multi-year, annual and longitudinal, study of veteran and military spouse entrepreneurs. This effort is one of the first national initiatives to develop data-driven research focused on military-affiliated entrepreneurship. The research seeks to gain better insights and understanding of military-affiliated entrepreneurs and identify economic, political, and socio-cultural factors that serve as barriers to entrepreneurship for military-affiliated individuals. This brief provides the latest insights from the 2021 NSMAE survey.  The findings reported here are from both a longitudinal and cross-sectional sample of over 2,000 veteran entrepreneurs. Future briefs will include subsequent data analysis on focused topics and various populations within the military-affiliated community. This annual survey and forthcoming public dataset will be an enduring source of current insights for public and private sector leaders, policymakers, and community-based organization on systemic barriers to and drivers of entrepreneurial success among veterans and their family members.

Entrepreneurial Characteristics

Motivations

Opportunity Recognition

Chance to implement own ideas/creating something

32%

Personal Independence

Make own decisions

36%

Maintain Personal Freedom

36%

Work Life Balance and Flexibility

Improving quality of life

26%

Having more free time/flexible hours

25%

Financial Independence

Opportunity to be independent/increase personal income

35%

Helping society/supporting community

21%

0 %
Consider themselves to be a social entrepreneur
0 %
indicate this is their first venture
0 %
have had multiple ventures
  • 36% owned 1-2 businesses
  • 47% owned 3-4 businesses
  • 17% owned 5 or more business

Military Transition into Entrepreneurship

0 %
were interested in entrepreneurship prior to the military
0 %
had difficulty with the transition from military to civilian life
0 %
indicated that entrepreneurship was helpful in finding a purpose after military
0 %
indicated that entrepreneurship made the transition easier

Top Transitional Challenges for Veteran Entrepreneurs were:

Loss of sense of purpose/camaraderie

26%

Financial struggles

25%

Getting socialized to civilian culture

25%

Loss of connection with military community

25%

Finding employment for myself

24%

Business Characteristics, Growth, and Sales

The Nature of Business

In 2020, their businesses/ventures were:

  • Profitable (52%)
  • Breaking even (14%)
  • Reporting a financial loss (34%)

Businesses/ventures were in

  • Service-based business (57%)
  • Both product and service-based business (31%)
  • Product-based business (12%)

85% consider themselves successful entrepreneurs.

YET

56% depends on their top five customers, and in case they lost those top five customers they would either get out of business or would reap significant negative consequences.

Business Certifications

0 %
are formally or informally certified by a national, state, local certification body
0 %
find the process of obtaining certification to be difficult
0 %
Of those with certification, 49% generate revenue from clients that require certification(s)

64% are certified by Center for Verification and Evaluation, through the VA/Vets First (CVE).

61% are certified by Small Business Administration (SBA).

Top Business Designations:

Service-Disabled Veteran-Owned Businesses

71%

Veteran-Owned Businesses

65%

Small Business Certification

35%

Barriers to Entrepreneurship

Disability-Related Experiences

0 %
have a service-connected disability
0 %
indicate that service-related disability creates obstacles in their business
0 %
do not feel supported by Medical and Disability Service providers
0 %
entrepreneurship helped overcoming disability related challenges and barriers.
0 %
entrepreneurship helped with the recovery process
0 %
entrepreneurship played a significant role in my recovery process

Barriers to Entrepreneurship

0 %
Lack of access to capital
0 %
Problems finding good employees/contracted personnel
0 %
Lack of financing
0 %
Current economic situation
0 %
Irregular income
0 %
Federal regulations and policies
0 %
Taxes and legal fees
0 %
Lack of mentors for my business
0 %
Lack of experience in entrepreneurship or business ownership

The prevalence of certain problems and barriers faced by these veteran entrepreneurs changed dramatically between 2020 and 2021; when comparing the percentage of veteran entrepreneurs in our longitudinal study the biggest changes occurred:

 20202021 
Problems finding good employees29.9%39.0%9.10% Increase
Dealing with federal regulations & policies16.5%27.8%11.30% Increase
Lack of financing37.5%24.1%13.40% Decrease

Business Capital

Start Up

96% required initial start-up capital for their business venture.

0 %
of those required funding needed less than $25,000
0 %
of those required funding needed between $25,000 and $99,999
0 %
needed more than $100,000 initially to start or acquire a business

Growth

92% needed funding to expand or grow a business in 2020.

0 %
of those required funding needed more than $50,000
0 %
of those required funding needed more than needed more than $100,000
0 %
of those required funding were able to secure the funding needed to expand or grow the business in 2020
0 %
of those required funding were not able to secure any funding at all

Sources of Capital

80% of our respondents required financing in 2020.

0 %
personal and family savings of the owner
0 %
CARES Act's Payroll Protection Program (PPP
0 %
business credit card
0 %
CARES Act's Economic Injury Disaster Loans (EIDL)
0 %
personal credit cards

Startups (0-3 years old businesses)

Personal and family savings of the owner

71%

Personal credit cards

34%

CARES Act's Payroll Protection Program (PPP)

16%

CARES Act's Economic Injury Disaster Loans (EIDL)

15%

Businesses Older Than 3 Years

CARES Act's Payroll Protection Program (PPP)

47%

Personal and family savings of the owner

42%

Business credit cards

33%

CARES Act's Economic Injury Disaster Loans (EIDL

28%

54% applied for credit/financing with a lender or creditor.

Of that 54%…

0 %
were not declined by the lender or creditor
0 %
obtaining partial funding
0 %
were declined
  • 61% did not reapply anywhere
  • 28% were turned down by the same or different institution

Debt Overview

The average business debt of the respondents in 2020 was $191,686.

66% report business debt on credit cards.

0 %
have less than 10% of their business debt on credit cards
0 %
have 10-99% of their business debt on credit cards
0 %
report all (100%) their business debt to be on the credit cards

66% report business debt on credit cards.

0 %
pay an interest rate that is 10% or higher
0 %
pay more than 20% interest rate

How much stress does your business’ financial condition cause you?

No stress at all

18%

Not very much stress

20%

Some stress

40%

A great deal of stress

22%

Entrepreneurial Ecosystem

Finance

0 %
do not feel that capital is readily available
0 %
do not feel that the federal funding resources and support (PPP, EIDL, etc.) have been helpful to their business
0 %
are not aware of Community Development Financial Institutions (CDFI) resources

Government Support and Programs

0 %
find it difficult to cope with governmental bureaucracy
0 %
do not feel that there are enough adequate government programs to support their business
0 %
find it difficult to obtain licenses and permits

Community and Networks

0 %
feel responsible for their community
0 %
can find people in their local community to relate to
0 %
feel a sense of belonging in their local community
0 %
have difficulty navigating resources within their local community

Wellness

79% reported good to excellent general health while 21% reported poor or fair health.

Reported loss of energy either often or constantly during the past week

17%

Reported feeling burnout either often or constantly during the past week

17%

Reported difficulty concentrating either often or constantly during the past week

19%

During past year 4% considered attempting suicide.

Of that 4%…

0 %
sought help
0 %
did NOT seek help

Covid-19

were able to successfully adapt their business during the pandemic

87%

were able to accommodate remote work

79%

lost business

64%

identified additional opportunities for their business during the pandemic

56%

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