Women represent 10 percent of the veteran population in the U.S. but own one in six veteran-owned businesses. Their businesses generate over $17 billion a year, and the growth of women veterans’ startups has been “higher than any other segment of the entrepreneurship economy,” according to Carla Harris, chair of the National Women's Business Council.
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But only two of the companies on Forbes’ Top 25 Veteran Startups have women veteran founders (both co-founded with male business partners). What’s more, women entrepreneurs receive a staggeringly low 2 percent of all capital investment and only 4.4 percent of total dollars in small business loans. Many women veterans are starting their own businesses with just their personal savings.
Women veteran-owned startups are not just underrated and underfunded – they’re actually among the best investments.
U.S. military service members get some of the best entrepreneurial training in the world. Military men and women learn resilience, grit and an unwavering work ethic.
First-class training facilities and high-stakes combat environments instill in them a mindset of quick thinking and innovative problem-solving. These are some of the reasons veteran entrepreneurs, both men and women, tend to out-earn non-veteran entrepreneurs.
As the director of veteran entrepreneurship for PenFed Credit Union and a former leader at Bunker Labs DC, I’ve seen veteran entrepreneurs employ these skills to make successful businesses.
Consider this: Companies founded by women deliver more twice as much revenue per dollar invested than those founded by men. Women entrepreneurs create more jobs and hire more workers than their male peers. And women-owned businesses that generated revenues of over $1 million increased nearly 50 percent over the past decade, compared to 12 percent of all U.S. businesses.
Women veteran entrepreneurs don’t lack the skillsets, training or ability. Many of them just lack capital. That’s why PenFed created the Women Veteran Fund as part of our Veteran Entrepreneur Investment Program (VEIP) – to bridge the gap in funding and female representation in the investment process.
The recipient of our first investment, Air Force veteran Suzie Mills, started a yoga studio in her basement in 2013.
Today, Honest Soul Yoga has three studios in Virginia and is expanding to Washington, D.C., Florida and Texas. With the majority of her yoga students being service members or spouses, she’s promoting strong physical and mental health in military communities. And she’s helping combat the high unemployment rate among military spouses by hiring military or military spouses for over half her staff.
Mills is not alone in her hiring practices; in fact, veterans are 30 percent more likely to hire other veterans and spouses than their non-veteran counterparts. This is why investment in veteran businesses is so important. An investment in just one business has a ripple effect across multiple families and future generations.
Here’s what we need to support and scale women veteran startups:
More investor confidence in women:
A 2018 study by BCG found that “women founders and their [investment] presentations are subject to challenges and pushback… often, investors simply presume that the women founders don’t have [the basic technical] knowledge.” Additionally, many male investors “have little familiarity with the products and services that women-founded businesses market to other women.”
Larger loan approvals for veteran businesses:
Veteran business owners submit more loan applications and reach out to a wider variety of lenders, but they usually obtain less financing and get lower approval rates. We need more lender confidence in both male and female veteran entrepreneurs.
More women mentorships:
Women tend to be more conservative than men and ask for less money. In my experience, I’ve found that women veterans often make the mistake of trying to perfect their business before pitching. We need more mentors and coaches for women veteran entrepreneurs who have venture capital experience and will encourage them to pitch earlier and make bigger asks.
Broader support networks:
As an entrepreneur myself, I know that it can get lonely sometimes, and the lack of a predictable paycheck can be scary. Entrepreneurs tend to internalize their worries, and many experience high levels of anxiety. Support networks, through programs like VEIP, that connect entrepreneurs with mentors, advisors and other entrepreneurs who can help them navigate the psychological aspects of entrepreneurship, are critical.
My father was in the Turkish navy and worked for the U.S. Navy for almost 30 years after he came to America. I grew up with a firsthand sense of gratitude for our armed forces and the sacrifices their jobs require.
But we shouldn’t invest in veterans simply because we are grateful. We should invest in them because both female and male veterans have proven their ability to create successful and long-lasting businesses. Women veteran entrepreneurs in particular are poised to be the next big thing in business. Getting involved in the early stages could be the smartest investment move you make this year.
Seda Goff is director of veteran entrepreneurship for PenFed Credit Union and the PenFed Foundation.