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Grant Quezada, who owned the Founding Fathers Collection in Prescott, tried to work with the government to get the business off the ground, but eventually turned to the private sector. (Photo by Lillie Boudreaux/Cronkite News)
Rep. Eli Crane, R-Oro Valley, said in a hearing on veteran business owners that problems with federal loan aid suggest the government should not be in the lending business. (Photo by Lillie Boudreaux/Cronkite News)
WASHINGTON – An Arizona veteran who started several Prescott businesses after his military service ended told lawmakers Wednesday that lowering barriers and streamlining federal loan applications are necessary to help other vets become business owners.
“While we appreciate well-intentioned government programs like the Small Business Administration and the Veterans Business Development Office, it’s unfortunate that these programs often encounter roadblocks, red tape and bureaucratic hurdles when they need help,” said Grant Quezada. Owner of the Founding Fathers Collection.
Quezada’s comments to the House Small Business Committee hearing were echoed by other veterans on the panel and by the majority of the committee, who asked how the SBA and other agencies can best serve vets looking to transition into the business world.
But Rep. Eli Crane, R-Oro Valley, took a different approach, going down the line of witnesses, telling each one, “I’m impressed with the efficiency of the federal government.” Most said no, and one said it might be better.
Crane, a self-proclaimed “champion of veteran entrepreneurs,” shifted his questions from whether the federal government should get involved in small business lending to how to reform the SBA to better support veterans.
Founding Fathers co-owner Grant Quezada, an Army veteran who lives in Prescott, said he and other vets appreciate the small business administration’s efforts but find the red tape “obtrusive.” (Photo by Lillie Boudreaux/Cronkite News)
“I want to continue to push the committee that thinks we’re going to do a good job lending money to veterans or anybody else, because you know what you know — this city doesn’t do a good job lending money to anybody.” Crane said.
Tales of government bureaucracy were the theme of the hearing. Many of the veterans, like Quezada, said they worked for months to get government funding but turned to private equity.
“The local regional banks are not skilled enough to work in SBA construction, so the help we would normally get was being pushed to some of the bigger banks in Phoenix and down under,” said Quezada, a former Army Ranger.
After 10 months of searching for capital in Phoenix and Scottsdale, and with the help of a former military friend with experience in the financial sector, Quezada said he was finally able to secure a $4.5 million loan for the joint venture. He attributes his success to support from other veteran business owners.
Quezada said he did not use the SBA’s most popular loan programs, the 7A loan and the 504 loan, a testimony shared by another veteran.
“Our success is with private equity,” said Taylor Burke, a former Navy lieutenant commander who now serves as president of Rost Landscaping in Missouri. “I think SBA loan programs are sometimes a little overwhelming, especially like Sgt. Quezada’s concept.
All of the business owners said the SBA’s Veteran Assistance Program, Boots to Business, helped them transition from service members to entrepreneurs. But they all said they were struggling to get the capital and credit needed to grow their small businesses.
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“The main hurdle, and I believe we all understand, is getting capital for any veteran to get an idea from concept to launch,” said Michael Hyacinthe, former Navy petty officer, CEO and co-founder of Wimage, a visual-based startup. App.
Quezada said he finally found business success in the private sector when he sought out individuals above the business chain. Once Founding Fathers got off the ground, he said, he was able to use federal government funding through the local Northern Arizona Council to continue operations.
He said he doesn’t think those working at the SBA speak the same language as veteran small business owners.
“The person on the other side who’s trying to help doesn’t understand the problem or the urgency that we’re facing,” Quezada said. “If veterans can access their GI Bill and apply that to a business when they leave the military, I think that’s a wonderful way to set them up for success.”
But Crane said after the hearing that he thinks small business owners on Wednesday’s panel, and Americans in general, would be better served if the federal government withdrew funding from small businesses.
“I don’t think this city and the SBA should have a heavy hand when it comes to financing small businesses,” he said. “Of course I haven’t. I think limited government is a good thing.
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