National Survey of Military-Affiliated Entrepreneurs: 2020 Key Highlights

The IVMF National Survey of Military-Affiliated Entrepreneurs monitors trends in the activity, needs, and economic, social, and policy barriers of military-affiliated entrepreneurs in the United States. In its inaugural year, the intent was to draw from a cross-sectional sample of over 2,500 veteran entrepreneurs. Future surveys will also track trends and pressing issues. For example, in 2020 the survey was updated to focus on such COVID-19. All NSMAE surveys and forthcoming public datasets 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.

Motivations for Entrepreneurship

Top 5 Reasons Veterans Start a Business

Make my own decisions.

Chance to implement own ideas/creating something.

Opportunity to be financially independent/increase.
personal income.

Maintain personal freedom.

Helping society/supporting community. 

94% do not give up easily even in the face of difficulties.

Barriers to Entrepreneurship

Top Problems or Barriers in Pursuing or Achieving Business Goals

Financial Related Barriers

A) 66% reported difficulty with applying for grants from nonprofit organizations

B) 49% reported difficulty with applying for loans

C) 53% reported difficulty with identifying sources of funding to start the business

D) 34% were turned down by lender or creditor when applying for financing

 

Regulation Barriers

0 %
Reported that the certification process is difficult
0 %
Reported difficulty obtaining the necessary licenses to operate business
0 %
Reported difficulty registering your company with e-verify

Major Factors that Impact Starting a Business

People and Social Capital

  • 40% Lacked formal help to start a business
  • 32% Lacked experience or exposure to someone who has run a business

Capital

  • 33% Couldn’t afford long-term capital
  • 27% Couldn’t afford start-up costs

Experience/Knowledge

  • 27% Didn’t know practical details to start a firm
  • 23% Didn’t know the legalities of starting business

What does entrepreneurship success look like to you?  

Capital

Sources of Capital

72% needed capital to start/grow their business.
Top three Sources of Capital used in 2019 are:
Personal/family savings of the owner (63%)
Business credit card (38%)
Personal credit cards (35%)

Capital for Different Stages: Startup

0 %
In 2019, 59% needed less than $25,000 to start or acquire their business while 54% needed more than $25,000 to grow their business
0 %
In 2019, 60% of startup entrepreneurs were able to secure the initial funding for starting or acquiring a business while 41% of established entrepreneurs were able to secure the funding needed to grow their business.
0 %
In 2019, 25% of startup owners and 31% of established business owners were not able to secure any funding at all

Capital for Different Stages: Growth

0 %
54% needed more than $25,000 to grow their business
0 %
41% were able to secure the funding needed to grow the business in 2019 while 31% were not able to secure any funding at all
0 %
27% does not feel prepared for the traditional lending process

Credit Card

0 %
43% of business debt is on credit cards
0 %
66% pay an interest rate that is higher than 10%
0 %
19% pay an interest rate between 20-29.99%

What does entrepreneurship success look like to you?  

Support and Resources for Entrepreneurship

Limited Resource Awareness

0 %
44% did not know about resources for grants in their local area
0 %
52% did not know about Community Development Financial Institutions (CDFIs) in their local area
0 %
36% did not know about local incubators and accelerators in their local area

Resources in Communities

Financial Resources

59% indicate grant resources need improvement, 32% indicate this resource is sufficient, and 19% indicate this resource is outstanding

43% indicate CDFI resources need improvement, 44% indicate this resource is sufficient, and 14% indicate this resource is outstanding

Educational Resources

34% indicate local incubators and accelerators need improvement, 41% indicate this resource is sufficient, and 25% indicate this resource is outstanding

16% indicate local colleges and universities need improvement, 47% indicate this resource is sufficient, and 37% indicate this resource is outstanding

Networks and Membership Organizations

37% indicate networking resources for VBOs need improvement, 40% indicate this resource is sufficient, and 23% indicate this resource is outstanding

32% indicate local VSOs need improvement, 42% indicate this resource is sufficient, and 26% indicate this resource is outstanding

What does entrepreneurship success look like to you?  

COVID-19 Pandemic

  • 65% of veteran entrepreneurs indicate that their military experience has moderately or extremely prepared them for their business challenges associated with COVID-19 pandemic
  • 76% of veteran entrepreneurs indicate that they lost business due to the pandemic
  • 56% believe that their business has been supported by the federal government during the pandemic
  • 60% believe that their business has NOT been supported by local government

What does entrepreneurship success look like to you?