The Honest Picture: Contracting Money vs. Grant Money
Most articles about funding for veteran-owned businesses blur the line between grants, loans, contracting programs, and training resources. This makes it difficult to know what you are actually looking at. Here is the honest breakdown: **Federal contracting set-asides:** According to FPDS data, approximately $28.6 billion was awarded to SDVOSB firms in FY2025 across roughly 52,000 contract actions. This is where the real money is. It requires SDVOSB certification, SAM.gov registration, and the ability to compete for and deliver on government contracts. **Actual grants (free money to individual businesses):** Roughly $1,000 to $25,000 per award from a handful of small programs. Extremely competitive. These are supplementary, not foundational funding. **SBA loans with veteran benefits:** Up to $5 million with reduced fees. These are real loans you repay, but the terms are better than what most small businesses get. **Training programs:** Free education and mentorship through SBA, DoD, and nonprofit partners. Valuable but provide no capital. If you are a veteran looking to start or grow a business, the path with the most money behind it is federal contracting through SDVOSB certification. This guide covers all four categories so you can build a realistic plan.
SDVOSB/VOSB Certification: The Gateway to Billions
Service-Disabled Veteran-Owned Small Business (SDVOSB) certification gives your company access to set-aside contracts that are restricted to certified veteran businesses. The federal government has a statutory goal of awarding at least 5% of all prime contracting dollars to SDVOSBs (increased from 3% by the FY2024 NDAA). **Who certifies:** The SBA, through the VetCert program. Certification transferred from the VA's Center for Verification and Evaluation to SBA on January 1, 2023. Self-certification ended December 22, 2024. You must now go through SBA VetCert. **Processing time:** Average 12 days as of late 2025, after SBA cleared its backlog. This is dramatically faster than the 81-day average at the end of 2024. **Requirements for SDVOSB:** - Business must be at least 51% owned by one or more service-disabled veterans - Veteran owner(s) must control daily operations and long-term strategic decisions - Business must qualify as small under SBA size standards for your NAICS code - Veteran must have a VA-rated service-connected disability (any percentage) - No active exclusions in SAM.gov **Requirements for VOSB (non-disabled):** Same ownership and control requirements, but without the disability requirement. VOSB certification provides access to VA-specific set-asides but not the broader government-wide SDVOSB program. **How to apply:** 1. Register in SAM.gov (required first) 2. Apply at veterans.certify.sba.gov through MySBA Certifications 3. Submit proof of veteran status, disability rating (for SDVOSB), business formation documents showing 51%+ veteran ownership, and documentation of veteran operational control 4. Certification is valid for 3 years; recertify within 90 days before expiration **Important note:** The old VetBiz portal (vetbiz.va.gov) no longer handles certification. The SBA's Dynamic Small Business Search, part of SAM.gov, is now the official system contracting officers use to verify SDVOSB/VOSB status.
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VA Contracting: The Vets First Advantage
The VA has the strongest veteran business contracting program of any federal agency. Under the Vets First program (38 U.S.C. 8127), VA contracting officers must follow a mandatory tiered evaluation: 1. **SDVOSB first:** Can two or more certified SDVOSBs fulfill this requirement? If yes, the contract must be set aside for SDVOSB competition. 2. **VOSB second:** If SDVOSB set-aside is not feasible, consider VOSB set-aside. 3. **Other small business:** 8(a), HUBZone, WOSB, or general small business set-asides. 4. **Full and open:** Only if no small business set-aside is appropriate. This tiered system means SDVOSBs get priority over every other certification category at the VA. No other federal agency has this hierarchy. **Sole source authority:** SDVOSBs can receive VA sole-source awards up to $5 million for manufacturing and $4 million for other contracts. VOSB sole source thresholds are the same but only available after SDVOSB is exhausted. **The numbers:** The VA awarded approximately $10.2 billion (23% of prime contract dollars) to SDVOSBs -- far exceeding the 5% government-wide goal. Over 2,300 SDVOSB firms received VA contract awards. **Key VA contract vehicles:** | Vehicle | Type | Notes | |---|---|---| | T4NG | Multi-Award IDIQ, $22.3 billion ceiling | IT modernization, cybersecurity, systems engineering | | VETS 2 GWAC | Government-wide, SDVOSB exclusive | IT services. Managed by GSA. Expires September 30, 2026; no successor announced as of February 2026 | | VA Federal Supply Schedule | Multiple award | Medical supplies, equipment, pharmaceuticals, services | For broader context on how set-asides work across all agencies, see our set-asides guide. For defense contracting specifically, see our defense contracts guide.
Actual Grants: What Exists and How Much
These are programs that provide free money to individual veteran-owned businesses. They are small and competitive, but they are real. **Hiring Our Heroes Small Business Grant** Amount: four grants of $10,000 and one grant of $25,000 per cycle (5 winners total). Sponsor: U.S. Chamber of Commerce Foundation, funded by FedEx Founder's Fund. Eligibility: for-profit business, 51%+ veteran or military spouse owned, 3-20 employees, under $5 million annual revenue, located in economically vulnerable community. The most recent cycle closed December 15, 2025 (winners notified by March 2026). Check hiringourheroes.org for the next cycle announcement. **Second Service Foundation (formerly StreetShares Foundation)** Amount: monthly awards of $5,000 (first place), $3,000 (second), $2,000 (third). Business must be 51%+ veteran-owned with social impact on the military community. Competition format: submit business plan, pitch video, and essay. **Warrior Rising** Amount: up to $20,000 for graduates who pitch successfully. You must first complete Warrior Academy (self-paced course) and Warrior University (8-week virtual accelerator), then pitch to a panel. The training itself is valuable; the grant is a pitch competition at the end, not guaranteed. **Farmer Veteran Fellowship Fund** Amount: $1,000 to $5,000 for approved agricultural equipment, paid directly to vendors. Must be a Farmer Veteran Coalition member with honorable discharge and an operating agricultural business. Since 2011, the program has awarded over $5.5 million to more than 1,300 farmer veterans. See our USDA grants guide for additional agricultural programs. **Stephen L. Tadlock Veteran Grant (NVSBC)** $1,000 grants to 20 finalists. Applications typically open in September. **State-specific veteran grants** exist but vary widely. Texas Center for Women Entrepreneurs offers $5,000 to female veterans. California's Beyond Open program offers $10,000+ to veteran-owned businesses among other categories. Check your state economic development agency for current programs. **What is NOT a grant:** The Bob Woodruff Foundation funds veteran-serving nonprofits, not individual businesses. The National Veteran Small Business Coalition is a membership and networking organization, not a grant program. The Beginning Farmer and Rancher Development Program provides grants to training organizations, not individual farmers.
SBA Loan Programs with Veteran Benefits
The SBA offers reduced fees and favorable terms for veteran borrowers. These are loans, not grants, but the terms are better than most small businesses can access. **SBA Veterans Advantage Express Loans** Borrow up to $500,000. The upfront guaranty fee is reduced to 0% (zero) for qualifying veterans. 50% SBA guarantee. Faster processing than standard 7(a) loans. **SBA 7(a) Veterans Advantage** Borrow up to $5 million. Veterans receive a 50% discount on all guaranty fees. 85% SBA guarantee on loans up to $150,000; 75% on loans from $151,000 to $3.75 million. **Eligibility for both:** Business must be 51%+ owned by an eligible veteran (includes veterans, active duty in TAP, current spouse of veteran or service member, widowed spouses of those who died in service or from service-connected disability). **FSA Microloans for Veteran Farmers** Up to $50,000 per operating microloan through USDA's Farm Service Agency. Veteran-specific advantages: microloans to veterans do not count toward the total years a farmer can receive FSA direct loan assistance. If two applications arrive the same day, the veteran's application gets preference. Military leadership experience can substitute for one of the three required years of farm management experience. For SBIR/STTR research grants (up to $2 million), veteran-owned small businesses are eligible on the same terms as any qualified small business. SBIR does not have veteran-specific set-asides, but some agencies give preference points.
Free Training and Mentorship Programs
These programs provide no capital, but they are genuinely useful and completely free. **Boots to Business (B2B)** SBA's entrepreneurship training course delivered during the DoD Transition Assistance Program. Two-day workshop during TAP, followed by an optional 8-week online course (Revenue Readiness). Boots to Business Reboot is a 6-week online version for veterans who already separated. Open to transitioning service members, veterans, National Guard/Reserve members, and military spouses. **V-WISE (Veteran Women Igniting the Spirit of Entrepreneurship)** Three-phase program for women veterans: online coursework, in-person conference, and ongoing mentorship from experienced women entrepreneurs. **STRIVE** A 10-week business-building course created by Syracuse University's D'Aniello Institute for Veterans and Military Families. Delivered through partner institutions. IVMF reports having trained over 70,000 participants across all its programs (not just STRIVE). **Veteran Business Outreach Centers (VBOCs)** 31 centers nationwide offering free business plan workshops, concept assessments, one-on-one mentorship, and referrals. Open to active duty (including TAP participants), veterans, Reserve/Guard members, military spouses, and veteran-owned businesses. Find your nearest center at sba.gov/local-assistance. **WIOA Priority of Service** Under the Workforce Innovation and Opportunity Act, veterans and eligible spouses receive priority at all American Job Centers (formerly One-Stop Career Centers) for job search assistance, career counseling, training programs, and supportive services. This is not a separate program; it is a priority overlay on all DOL-funded workforce services. **Transition Assistance Program (TAP)** The mandatory interagency transition program for separating service members includes modules from DoD, DOL, VA, and SBA. Not a funding source, but the primary channel through which separating service members learn about SBA programs, VA benefits, and DOL employment services. The SBA Entrepreneurship Track includes Boots to Business.
Building a Realistic Funding Strategy
If you are a veteran starting or growing a business, here is a practical sequence: **Step 1: Get certified.** If you have a service-connected disability (any percentage), apply for SDVOSB certification at veterans.certify.sba.gov. Processing takes about 12 days. You need SAM.gov registration first (6-10 weeks). Start both immediately. **Step 2: Get trained.** Complete Boots to Business Reboot (6 weeks, free) or connect with your nearest VBOC for one-on-one advisory. If you are a woman veteran, look into V-WISE. These programs help you develop your business concept before you chase funding. **Step 3: Access contracting.** Once certified, start monitoring set-aside opportunities on SAM.gov and through our search tool. Understand your NAICS codes. The VA is the best starting point because of the Vets First tiered evaluation. The VETS 2 GWAC expires September 30, 2026, so consider whether that vehicle fits your capabilities. **Step 4: Apply for grants selectively.** Monitor the Hiring Our Heroes cycle (applications typically due in December), Second Service Foundation monthly competitions, and state-specific programs. These are supplementary. Do not wait for a grant to launch your business. **Step 5: Explore SBA loans if you need capital.** The Veterans Advantage Express Loan ($500K, 0% guaranty fee) is the most accessible SBA option for veterans. Talk to an SBA lender about your eligibility. **Step 6: Consider SBIR if you do R&D.** If your business involves technology development or innovation, SBIR/STTR grants offer up to $2 million in non-dilutive funding. These are available to any qualified small business, not veteran-specific, but they are among the largest grants available. There are more support programs for veteran-owned businesses than for almost any other category. The key is understanding that federal contracting is the primary financial engine, grants are supplementary, and the training and mentorship resources are genuinely worth your time. For women veterans, see our women and minority business guide. For veteran-owned businesses on tribal lands, see our tribal grants guide.