As the world’s largest customer, the U.S. federal government represents an incredible business opportunity for veteran small business owners. And recent signs point to this opportunity only increasing for 2017 and beyond.
Generally speaking, for everything from defense to healthcare, the government constantly needs all manner of products and services. Veteran small business owners serving this area have always been a natural fit given that veterans once worked for the federal government in defense.
Naturally, this means veterans have acquired valuable contacts, skills, and know-how regarding the needs of this huge customer. Veteran contractors find themselves involved in everything from providing essential cyber security work for the Department of Defense to selling medical devices to the Department of Veterans Affairs.
It is crucial that veteran small business owners understand the large-scale opportunity that exists, the resources at their disposal, and then some fundamentals on contract financing options. Regarding the latter, this type of funding option is one they may not have heard before or be familiar with.
Contract-based financing can be a valuable resource for veteran small business owners serving state and local government level buyers as well.
Opportunity for Veteran Small Business Contractors
Congress has recognized the importance of a vibrant U.S. small business community, and the superior service provided by veteran-owned small businesses by writing into law, set-aside goal measures for each department in the federal government and agencies. Incidentally, many departments have failed to meet these goals for engaging veteran-owned and small business contractors, but recent news gives cause for optimism.
For example, just last year the U.S. Supreme Court sent a clear signal regarding the set-aside goal measures for Service Disabled Veteran Owned Small Businesses (SDVOSB) with respect to the Department of Veterans Affairs (VA). This case involved a company named Kingdomware Technologies, a SDVOSB to receive a favorable outcome. In essence, the Supreme Court reminded the VA and other government departments that goals exist to provide small business opportunities for service-disabled veterans.
All government buyers need to be aware that the court’s reasoning applies to the Small Business Act goals. These goals set by agency-specific laws, such as the VA law, was at issue in the Kingdomware case.
Government contractors are keeping a close eye on the new Trump administration for signals as to new spending priorities. President Trump and his administration have already signaled large plans when it comes to both infrastructure spending and bolstering the capabilities of the Department of Defense.
For infrastructure, it is already likely the President will garner support from many Democrats in Congress. If the two parties rapidly come to agreement, a package as large as $1 Trillion could be passed as quickly as this year with ramifications for everything, from widening toll roads in Northern Virginia to restoring bridges and tunnels nationwide.
In the area of national defense, the president will soon unveil a military budget for the next four years. Although specific details are pending, many agree this budget will include plans to build more ships and aircraft. One can also expect unprecedented investment in cyber security and modernization of the nation’s nuclear arsenal.
Veteran small business government contractors will be crucial in all of these areas.
Resources that exists for Veteran Small Business Government Contractors
StreetShares has outstanding partners who can help the veteran small business community learn more and access these opportunities.
For federal government opportunities, FedBid is the leading online reverse auction procurement platform serving more than 75 federal agencies. A stunning 85 percent of contracts awarded on FedBid go to small businesses annually. Registering as a seller on FedBid opens up tons of opportunities for any veteran small business contractor seeking to work with the federal government.
Many state governments have also organized small business purchasing initiatives like California’s online marketplace CaleProcure, open to any business wanting to sell to California departments and agencies. StreetShares is fortunate to partner in Nor-Cal FDC which has tools to help small businesses navigate the opportunities and even connect with sources of funding.
Although not specifically directed to contractors, Florida has an impressive initiative in the form of Veterans Florida where veterans either living in the state or wanting to relocate there can obtain entrepreneurship training, access employers, and receive support if their dream is to start their own business, perhaps as even a contractor.
Not sure how to get started? Check out veteran-friendly workspaces and incubators focused on helping veteran small business prime and subcontractors. Our partners like Eastern Foundry, a collaborative workspace, offers government prime contractors and subcontractors the insight and resources for the federal market in particular. There are also special events like the Veterans’ LDRSHIP Network, a collaboration of military support organizations and businesses. Their most recent event took place in the Kansas City Metro area at The Grid.
Once beyond the startup stage, small businesses in federal contracting can find tremendous resources in firms like Solvability that can help with everything from processes to new connections (from their teaming relationships). Their knowledge, experience, training, and connections can often make all the difference. An example of the great tools they offer is a “Wrap Calculator” to help determine the costs associated with winning contract and determining funding needs.
The Benefits of Contract Financing Options
StreetShares specializes in the veteran small business owner and government contractor space. We are mission-focused on providing funding solutions that are not just fast and fair but also affordable and transparent. As fellow veterans, we are all too familiar with the damage that can be done by funding sources that take “payday lenders” as their role models.
Many veteran small business owners have already enjoyed the simplicity of the StreetShares Simple Term and the flexibility of the Patriot Express Line of Credit. Transparent pricing and no pre-payment penalties of any kind have been the hallmark of these popular small business financing options.
Many StreetShares members have asked for a contract financing solution. We are proud to answer the call and now offer this solution.
Whereas term loans and lines of credits work well for veteran small business owners with steady or established cash flows, contract financing or factoring is the perfect solution for veteran small business prime contractors. StreetShares contract financing is designed for contractors who are often “contract rich” while being cash flow poor.
Does this scenario sound familiar to you? As a skilled provider, you have worked hard to earn a contract but have not yet been able to invoice for it. So, government contractors have money coming in as future payments, but plenty of money is going out. It’s hard to break out of that cycle because veteran contractors need to pay and hire personnel, order supplies and equipment to get rolling.
To make matters more challenging, that veteran contractor could be a subcontractor to a prime. Meaning he or she may have to wait even longer to invoice or get paid.
Break out of the Cycle
StreetShares contract financing is designed to break you out of that dilemma. Your contract award helps make the case for the funding the contractor needs now. Important considerations for government contractors are what needs to be purchased and when as well as what the worst case scenario could be for invoice financing and payment. StreetShares is able to help contractors step through that. Subscribe to the StreetShares blog to learn about deeper insights into calculating needs and case studies of how contract financing can make all the difference for veteran small business contacts. Or get started with contract financing with StreetShares to see how we can help fund your invoice.
Learn the ins and outs of government contract financing in this ebook we created with the experts in proposal writing, bidding and managing a sales pipeline. "The Government Contractor's Handbook for Veteran Business Owners" will help you every step of the way. Download it now.