A plain-language rundown of ten funding sources for veteran founders, sorted by what they actually are: grants, loans, or equity.
The short version
Money for a veteran-owned startup comes in three forms: grants you do not repay, loans you do, and equity you sell for a share of the company. This list covers ten sources across all three. Know which type you are taking before you sign anything.
Source: U.S. Small Business Administration
How to use this list
These are vetted, not ranked, and being listed here is not an endorsement. None of these can promise you funding. Eligibility, terms, and open windows change often, so confirm current details on each official site. Before you raise a dollar, get your own money squared away using the separation money checklist.
Grant, loan, or equity: what is the difference?
A grant is money you do not repay, often tied to a pitch contest or a narrow purpose. A loan is money you repay with interest, and it does not cost you ownership. Equity is cash from an investor in exchange for a share of your company and a say in it. Each has trade-offs, so match the source to your stage and your risk tolerance.
The 10 funding sources
- SBA 7(a) loan program (loan): The SBA's primary loan program, delivered through participating lenders and partially guaranteed by the SBA. It fits owners with a plan and some credit history. Use SBA Lender Match to find a lender.
- SBA Military Reservist Economic Injury Disaster Loan (MREIDL) (loan): A low-interest loan of up to $2 million for a small business that cannot meet operating expenses because an essential employee, a reservist, is called to active duty. It fits businesses hit by a mobilization. Apply through the SBA.
- Hivers and Strivers (equity): An angel investment group that backs early-stage companies led by graduates of the U.S. military service academies. It fits academy-graduate founders raising early capital. Review criteria on the site.
- TFX Capital (equity): A venture firm that invests in seed and early-stage companies led by military veterans. It fits veteran founders in tech-driven markets. See portfolio and thesis on the site.
- Veteran Ventures Capital (equity): A veteran-owned growth-equity fund focused on veteran-led, dual-use national security technology companies. It fits founders with commercial traction in defense-adjacent markets. Learn more on the site.
- Context Ventures (equity): An early-stage fund that invests in military veteran founders across fintech, defense, and consumer, and runs research and community events for the ecosystem. It fits early veteran founders. See the site for focus areas.
- Squadra Ventures (equity): An early-stage fund, led by a former Army intelligence officer, investing in cyber and national security companies with dual-use applications. It fits founders building in that space, veteran or not. Review the thesis on the site.
- PenFed Foundation Veteran Entrepreneur Program (access to capital): A free incubator and accelerator for veteran and military-spouse founders that provides mentorship and connections to capital. The Foundation states it does not take equity. It fits founders who want structure and network. Apply on the site.
- Warrior Rising (grants): A veteran-founded nonprofit that runs pitch events awarding grant funding to veteran entrepreneurs, on top of free training. It fits veterans who want non-dilutive support. Start on the site.
- DAV Patriot Boot Camp (grants): A DAV program whose cohorts can culminate in a pitch contest offering non-dilutive funding, plus education and mentorship. It fits military-connected founders. Watch the site for application windows.
Frequently asked questions
What is the difference between non-dilutive and dilutive funding?
Non-dilutive funding, like a grant or many loans, does not cost you ownership. Dilutive funding, like equity from an investor, gives up a share of the company. Grants and loans keep your cap table clean, while equity brings capital and a partner with a stake.
Is a veteran-owned business guaranteed a loan?
No. Veteran status can open doors and, at times, reduce certain SBA fees, but every lender still underwrites the loan. Approval depends on your finances, credit, and plan.
Do the venture funds only invest in defense tech?
Not all of them. Several veteran-focused funds lean toward defense and dual-use technology, but others back fintech, consumer, and B2B. Read each fund's stated focus before you pitch.
Can I combine sources?
Often, yes. Founders frequently stack a small grant, a loan, and later equity as the business grows. Just track the terms and obligations of each.
Where do grants come from now that some foundations closed?
Look at active pitch competitions run by groups like Warrior Rising and DAV Patriot Boot Camp, and check your local VBOC for current opportunities. Grant programs open and close, so verify before you rely on one.
What should I have ready before I ask for money?
A clear plan, clean financials, and a specific ask. Know how much you need, what it buys, and how you will repay a loan or use investor capital.
Where to get help
- SBA Veterans Business Outreach Center: free counseling on loans and lender readiness.
- Your installation TAP office: transition counseling and the entrepreneurship track.
- Military OneSource: free financial counseling and referrals.
- VA: benefits and, for eligible veterans, a Veteran Readiness and Employment self-employment track.
Verification Notes
- StreetShares, the veteran-focused online lender, and the StreetShares Foundation (later the Second Service Foundation) were considered but dropped. The lender is no longer operating as before, and the Second Service Foundation states it has voluntarily shut down and is transitioning resources to a new faith-based nonprofit.
- SBA fee relief for veterans (historically called Veterans Advantage) has changed over time and, for some loans, upfront fees have been set to zero for all borrowers in certain years. Confirm current fee terms with the SBA or your lender before you count on savings.
- The $2 million figure for MREIDL is the SBA-published maximum. Confirm current caps and rates on the SBA site.
- Squadra Ventures invests in cyber and national security broadly and is not veteran-exclusive. It is included because its focus overlaps with where many veteran founders build.
- Investment focus, fund status, and open cohorts change. Confirm current details on each official site.
Sources & links
VetraFi does not provide financial, investment, tax, legal, or accounting advice. The content provided is for informational purposes only. You should consult your own advisors before engaging in any transaction.
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