The fully accessible guide to starting a business as a disabled entrepreneur


Lack of funding can lead to unique challenges for disabled business owners

By Andrew Paniello  |  Published: January 17, 2019

In 2017 the United States Congress quietly made the move to decrease provisions that enable the Small Business Administration (SBA) to make special loans to entrepreneurs, including individuals with disabilities. In addition, the SBA has stopped processing new loan approvals since Dec. 22 due to the government shutdown, affecting many small business owners throughout the U.S.

Though there are still several reasonable financing options available to those with disabilities, many in the community are affected by this news, especially considering the unique need of many handicap people to start their own businesses.

According to the most recent estimates, roughly 20% of Americans have at least one disability. But while some disabilities can make it difficult to complete certain tasks, many people with disabilities have still been able to accomplish remarkable things. Disabled people are a significant portion of the American workforce and many have gone on to start small businesses of their own.

Even if you currently have a low credit score as a consequence of lost income, starting a business of your own may be much more doable than you’d initially assume. In terms of possible wealth, life satisfaction, and career development, small business ownership can be incredibly rewarding.

Successfully running a business will require hard work, market awareness, and adequate sources of funding. In this article, we will provide useful resources and tips for starting a small business as a disabled entrepreneur and the first steps you can take to actually get there.

The benefits of starting a small business

The Social Security Administration defines a disability as a condition that results in: “The inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or has lasted or can be expected to last for a continuous period of not less than 12 months.”

SSA disability benefits are often not enough to cover all living expenses. Medical bills, medications, therapy and assistive devices costs can pile up on top of ordinary living expenses like housing, utility bills and transportation. This makes it vital in some cases for people with disabilities to create alternative ways of income.

Entrepreneurship offers the level of flexibility and freedom that many disabled individuals have been searching for. By creating your own business, you may be able to work from home, make any adjustments to your working space as needed and receive extra income to cover living expenses. There are many advantages for those with disabilities to start a business:

  • Flexibility: Ability to create your own schedule and working conditions
  • Financial Stability: Extra income to cover medical and housing costs and a sense of financial independence
  • Well-being and happiness: Owning a business can provide one with a sense of purpose and self-worth

On the other hand, starting your own business is not without risks. Most new business owners will need to contribute at least some of their own capital up front and even those who don’t may face long-term financial consequences if their business is unsuccessful. Furthermore, Congress’ silent reform of the Small Business Administration in 2017 has made disability-specific small business loans more difficult to access.

Still, even in the face of possible obstacles, the benefits of starting a new business are quite apparent. As a result, tens of thousands of individuals with disabilities are likely to start their own businesses within the next calendar year.

Programs designed for disabled entrepreneurs

For those who do qualify as disabled, there are several programs that can help.

These are just a few of the programs specifically designed for disabled entrepreneurs:

  • 8(a) Business Development Program: Despite other cuts to SBA programs, this particular program is designed to help “socially and economically disadvantaged people”, which includes those with disabilities. Resources include access to education, training, and special government contracts.
  • DOBE Certification: This certification is given to any business that is majority owned by individuals with verified disabilities. Being certified may result in increased access to funding programs, various business aid programs, and increased visibility in the community.
  • Medical grants: By decreasing the cost of medical expenses connected to your disability, you can start your business with less debt. Furthermore, having less debt may increase your credit score and also give you access to other sources of funding.
  • PASS Program: This is a vital federal program that is designed to help individuals with disabilities enter into the workforce. PASS helps individuals with a variety of different tasks including transportation, getting supplies and equipment, and creating a disability-friendly work environment.

These programs are designed to make it easier to start a business. Determining the details of your business—funding, necessary materials, operations, etc.—in advance, you will be much more likely to get your business off the ground and running.

Developing a business plan

Regardless of what type of business you are planning on creating, it will be very important to come up with a detailed business plan. Your plan should describe the goals of your business and how you plan to accomplish these goals. Any effects of your disability should also be accounted for.

Familiarizing yourself with the unique challenges of being a disabled business owner can be very beneficial. It may also be helpful to talk to people who have already established themselves within your industry or who have made the decision to start other businesses of their own.

When attempting to define your business’ long-term objectives, many business owners find the “SMART” Goal model to be quite useful. Your goals should be:

  • Specific: What is your business hoping to achieve?
  • Measurable: How will you measure whether or not you’ve succeeded?
  • Attainable: Are these goals something that you can realistically achieve?
  • Relevant: How are your long-term objectives related to your business?
  • Timely: When is the deadline for completing your first set of goals?

If it is your first time starting a business, you may also want to consider using business models that have worked exceptionally well for people with disabilities. For example, choosing to start a franchise may give you access to certain company benefits or choosing to start a business connected to any personal skills may help you quickly establish a competitive advantage.

Building credit and funding your business

Unfortunately, many disabled individuals who have not worked in a while can likely have imperfect credit scores. Disability income from the government is often insufficient, which frequently results in endless cycles of debt. If you have a good credit score, financing a business should be quite easy. With a poor credit score, financing will be a bit more difficult but is still certainly possible.

Anyone with a bad credit score (or who has claimed bankruptcy in the past decade) can begin improving their score in several different ways. Start a new (presumably high-interest) line of credit and always pay your bills in full and on-time, this will help gradually increase your score. Consolidating and settling old debts, closing delinquent lines of credit, and making payments early may all also be quite helpful.

It is important to keep business and personal expenses separate to protect your personal finances and keep everything organized. Opening a business credit card is a great way to keep track of your business expenses and also build up your business credit score.

Evaluating your funding options

Regardless of what your current credit situation may be, there are likely many reasonable options for you to fund your business with:

Business loans: These loans are intended for a specific business purpose. Loans from banks, credit unions and SBA are all sources for small business loans.

Pros: Business loans generally have low-interest rates and they help build business-specific credit.

Cons: They can be difficult to qualify for with bad credit, recent issues with SBA might make them difficult to obtain.

Certifications: Obtaining a small business certification from the government documents that your business has a special capability or status, which can help you compete in the marketplace.

Pros: Certifications help legitimize business and are non-competitive.

Cons: They usually have strict requirements and funding is not guaranteed.

Small business grants: A certain amount of money given by the federal government, private businesses and/or corporations with no expectation that funds will be paid back.

Pros: Grants have no strings attached and are widely available for individuals with disabilities.

Cons: They can be very difficult to qualify for, the money usually has some restrictions and there are limits to the amount you can receive.

Venture Capitalists: An investor or firm who provides capital for startups or high-risk companies.

Pros: Venture capital can offer business expertise, additional resources and connections.

Cons: They expect to make money and often take control of key business decisions.

Crowdfunding: This involves setting up campaigns (most of the time online) to raise money from a large number of people.

Pros: Low risk, not required to give equity to your supporters, a small donation is feasible.

Cons: Often a small fee for the platform you use, must be transparent to your backers on how you used the money.

Business credit cards: Credit cards specifically designed for business owners.

Pros: Business cards are typically easy to qualify for, can help maintain and build your business’ credit, and offer rewards on travel, hotels and more.

Cons: Credit cards tend to have higher interest rates, personal liability (any late payment could affect your personal credit score), and risk of security issues.

These are just a few of the ways that people with disabilities help fund their business. The six methods listed above are very rarely mutually exclusive—it may be in your best interest to explore all of the available methods and then choose a funding strategy that combines multiple options at once. Funding won’t be all you need in order to start a successful business, but it will certainly be an important step in the right direction.

The bottom line

Regardless of the challenges that may come from having a disability, there are still plenty of extraordinary things waiting to be accomplished. With a quality business plan, reliable source of financing, and clear vision for the future, you may be able to quickly begin a successful business of your very own.

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