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  • Writer's pictureCalla Norman

Loans for Veteran-Owned Small Businesses in 2022

Updated: May 13, 2022

Storefront of Lucky Sign Spirits in Millvale, Pennsylvania

Perseverance, work ethic, and management skills are all traits that veterans often report they learned in service which have helped them tremendously in becoming entrepreneurs. So, why is it so difficult for these veteran small business owners to find funding for their businesses?

In this article, we’ll talk about the barriers that veterans face when trying to break into the small business world and get funding, different funding options that are available to them, and how loan crowdfunding can be a great option for them to find fair access to capital to help their businesses grow!

Crowdfund your growth, build your community

Because of their service, veteran-owned business owners know the grit and perseverance it takes to run a business, even if it’s their first time owning one. This is why it’s imperative that veteran entrepreneurs can have fair access to capital to grow their businesses to the next level.

Learn more about Honeycomb crowdfunded business loans at and fill out the form below for more information.

Barriers for Veterans in Small Business

Like with other socially disadvantaged groups, veteran small business owners face barriers to entry into the business world. The New York Federal Reserve bank reports that although veterans are more likely to be self-employed, there has been a significant decline in those numbers since 2011.

While part of this decline has been attributed to age (self-employed veterans are more likely to be older, and are now reaching retirement age), there are other factors to consider that keep veterans out of the workforce. Experian notes that lack of prior business experience (due to serving) and lack of a business network often hold veteran entrepreneurs back.

That first factor, lack of prior business experience, is a major obstacle that veteran business owners face in accessing capital from traditional financial institutions. Most banks want to see that a business has been operating for at least 2 years, or at least that its owner has had past experiences. This, compounded by the fact that veterans often lack collateral and credit, basically means that the act of finding a loan through traditional means was over before it even began.

So where can a veteran find a Small Business Loan?

Small Business Administration (SBA)

While the only loan available for veteran small business owners through the SBA is the Military Reservist Loan (which is essentially a loan to help cover business expenses if you have an employee who’s called up from the reserves), there are other resources available through the administration just for veterans.

Among the SBA’s offerings for veterans, there is the Office of Veterans Business Development, which provides resources for veteran-owned businesses and helps to connect veteran entrepreneurs to SBA lenders. There’s also a veteran-owned contracting program, as well as a number of entrepreneurship training programs specifically for veterans.

U.S. Department of Veterans Affairs

Like the SBA, the VA doesn’t offer funding outright to veterans. However, small business owners can access a lot of useful information and connections from the VA’s Veteran Entrepreneurship Portal.

The Veteran Entrepreneurship Portal gives small business owners educational materials on how to start, finance, and grow a business. It’s also where you can get certified as a veteran-owned business, which can put your business in line for veteran-first opportunities.

Veterans Business Fund

This is a nonprofit that’s backed by venture capitalists, business development centers like SCORE, banks, and of course veterans. The Veterans Business Fund is actually still in development, raising funds to be able to execute their mission, but in the future will be a great resource for veterans seeking funding to start a business.

When it comes to fruition, this fund will offer no- or low-interest loans to veterans, which will be able to be used not only toward capital projects, but also toward showing other financial institutions that they’ve got collateral invested, increasing a veteran entrepreneur’s shot at getting approved for a loan.

Warrior Rising

Warrior Rising is a business incubator for “vet-trepreneurs.” They help veteran business owners along the business planning journey by providing training and support, as well as helping them access funding for their businesses.

How effective is crowdfunding for financing veteran-owned businesses?

Another venue through which a veteran-owned business can find funding is through crowdfunding! There are multiple types of crowdfunding for small businesses: equity, gift or reward crowdfunding, and loan crowdfunding.

Most people know about reward crowdfunding, like Kickstarter or IndieGoGo, where a business offers perks like t-shirts or tasting sessions in exchange for monetary gifts. This kind of crowdfunding sometimes can rub business owners the wrong way and make them feel like they’re asking their customers for “free money.” This could especially be so for veterans who see themselves as more self-reliant and don’t want to ask for financial help that they can’t pay back.

However, what if we told you there was another form of crowdfunding where you can actually pay back those contributions to those who invest in your business? That would be loan crowdfunding, which is what Honeycomb Credit specializes in.

Several veteran-owned businesses have found success on Honeycomb’s loan crowdfunding platform, including Scoot! Cold Brew and Lucky Sign Spirits.

Scoot! Cold Brew, a coffee shop in Cleveland run by veteran Kari DeGraff, used their Honeycomb campaign to build-out their retail space, and ended up raising $49,000 from 30 investors to do it!

Lucky Sign Spirits, a distillery in Millvale, Pennsylvania, was actually started during the pandemic and grew so much that they were in need of a new production space and a retail and taproom space as well! With Honeycomb, they raised nearly $122,000 to finance this growth.

“Using Honeycomb funds will allow us to expand our capabilities,” says Christian Kahle, co-owner of Lucky Sign Spirits. “We’re doing this not just for the business but for our community. We give back as much as we can, and we love to see everyone in this area grow.”


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