NDAA 2025 Brings Big Changes for Veteran-Owned Businesses
As Congress passed the National Defense Authorization Act (NDAA) for Fiscal Year 2025, a new wave of opportunities—and challenges—has emerged for veteran-owned businesses. This landmark legislation increases federal contracting goals for veteran-owned small businesses (VOSBs) and service-disabled veteran-owned small businesses (SDVOSBs) while also reshaping how these businesses access federal contracts.
For many veterans, entrepreneurship is a natural extension of their service. Yet, the changes brought by the NDAA have sparked mixed reactions within the veteran business community, with some applauding expanded opportunities while others voice concerns about potential roadblocks.
Expanding Opportunities in Federal Contracting
The NDAA 2025 raises the Department of Defense (DoD) contracting goal for veteran-owned businesses from 3% to 5%, signaling a broader commitment to veteran entrepreneurship. This change builds on recent efforts to ensure veteran-owned businesses have access to lucrative federal contracts.
Additionally, the DoD now has expanded authority to create set-aside contracts specifically for VOSBs, a privilege previously exclusive to the Department of Veterans Affairs (VA). This authority could open millions of dollars in contracting opportunities across industries such as cybersecurity, logistics, renewable energy, and manufacturing.
“This increase is a clear acknowledgment of the value veterans bring to the table,” said Matthew Pavelek, President and CEO of the National Veteran-Owned Business Association (NaVOBA). “It’s not just about providing opportunities; it’s about recognizing that veteran entrepreneurs are a critical part of our nation’s economic fabric.”
Administrative Hurdles: The VetCert Program
One of the most significant changes tied to federal contracting is the Veteran Small Business Certification (VetCert) program, managed by the Small Business Administration (SBA). This program replaces the previous self-certification model, requiring SDVOSBs to undergo a formal application and verification process.
While the goal is to ensure only legitimate businesses benefit from set-aside contracts, the new requirements pose challenges for many. According to the SBA, over 20,000 businesses have already applied for certification, but the backlog and complexity of the process are causing delays.
“This new system is creating unnecessary barriers,” said Jason Miller, a veteran and small business advocate. “For small businesses with limited resources, navigating the certification process can be overwhelming. We need to streamline the system to ensure veterans aren’t left behind.”
The Focus on Critical Technologies
The NDAA 2025 prioritizes industries vital to national security, such as artificial intelligence, advanced manufacturing, and renewable energy. While this focus aligns with future defense needs, it also narrows opportunities for veteran-owned businesses operating in traditional industries, such as construction or food services.
For businesses in specialized sectors, the new provisions offer substantial opportunities. Programs like the Small Business Innovation Research (SBIR) initiative and other defense-focused projects provide funding and mentorship for companies driving technological innovation.
However, the emphasis on advanced technology means that businesses outside these sectors may face reduced access to contracts. “We can’t forget the importance of veteran businesses in every industry,” said Alex Curtis, a representative of the Veteran Business Roundtable. “Not every veteran-owned business is in tech, but they’re still vital to our economy and our communities.”
The Way Forward
To fully realize the benefits of the NDAA 2025, veteran-owned businesses need support in navigating these changes. Advocacy organizations like VET-Force and the National Veteran Small Business Coalition (NVSBC) are stepping up to provide training, resources, and policy advocacy.
Additionally, veteran entrepreneurs are encouraged to:
Get Certified: Apply for the SBA VetCert program as early as possible to avoid delays.
Leverage Resources: Utilize Veteran Business Outreach Centers (VBOCs) and Procurement Technical Assistance Centers (PTACs) for guidance.
Engage in Advocacy: Work with organizations pushing for streamlined processes and expanded opportunities.
Conclusion
The NDAA 2025 has the potential to reshape the federal contracting landscape for veteran-owned businesses, offering expanded opportunities alongside new challenges. By addressing administrative hurdles, ensuring equitable access across industries, and supporting veteran entrepreneurs with targeted resources, Congress can make good on its promise to empower those who served our nation.
Veteran business owners are resilient by nature. With the right tools and support, they will continue to lead the charge in innovation, service, and economic growth, embodying the same values that defined their time in uniform. The NDAA 2025 is a step in the right direction, but much work remains to ensure no veteran is left behind.
