SDVOSB is a federal designation for small businesses owned at least 51% by a service-disabled veteran. Service-disabled means the veteran has a VA disability rating from military service. The SDVOSB designation provides access to federal contracting set-asides (contracts reserved exclusively for SDVOSB companies), preferential scoring in competitive evaluations, and participation in VA-specific programs like the Veterans First Contracting Program.
Opening Definition
An SDVOSB is a small business owned at least 51% by a service-disabled veteran with a VA disability rating. SDVOSB designation provides access to exclusive federal contract set-asides and preferential evaluation scoring in government competitions.
Why It Matters for Tech Companies
If owned by a service-disabled veteran, SDVOSB designation opens significant contracting opportunities. Federal agencies must set aside certain contract percentages for SDVOSB companies. SDVOSB contracts often face less competition than open competitions—you're bidding against only other SDVOSB firms. This dramatically improves win rates. The VA also requires agencies to give preference to SDVOSB companies. For veteran-owned tech companies, SDVOSB can be a major competitive advantage. The designation costs money and requires documentation but is worth pursuing if you qualify.
How It Works in Practice
Step 1: Verify Service-Disabled Status (Month 1) The owner must have VA disability rating (any percentage 0% or higher). You'll need VA disability rating letter. Step 2: Register in VosB System (Month 1-2) Go to vosb.va.gov and apply for certification. Provide VA disability documentation, company ownership documentation, and business information. Step 3: SBA Verification (Month 2-4) SBA verifies information and issues VosB certification. Takes 30-90 days typically. Step 4: Use Designation (Month 4+) Once certified, you can bid on SDVOSB set-asides and participate in VA set-aside programs. Example: Software company founded by Navy veteran with 20% VA disability rating. Register for SDVOSB certification with disability letter, corporate documents, and business financials. Within 60 days, receive VosB certification. Now can bid on SDVOSB set-asides at agencies. A contract you were competing on with 10 other companies is now an SDVOSB set-aside—you're competing with only 2 other SDVOSB firms. Win probability improves dramatically.
Common Mistakes to Avoid
- Not verifying service-disabled status early: Before investing in certification, confirm the owner has VA disability rating.
- Mixing up SDVOSB with VOSB: VOSB is for any veteran. SDVOSB requires disability rating.
- Not maintaining certification: VosB certification requires annual renewal. If certification lapses, you lose set-aside access.
- Assuming all SDVOSB contracts are easy wins: SDVOSB set-asides still require competitive proposals. You're competing against other capable SDVOSB firms.
- Only targeting SDVOSB opportunities: SDVOSB set-asides are important but limited. Continue competing in open competitions.
Key Facts and Numbers
- 51% ownership by service-disabled veteran required
- Any VA disability rating qualifies (even 0% if service-connected)
- 3-5% of federal contracting budget reserved for SDVOSB
- VosB certification lasts 3 years
- No SBA size limits for SDVOSB designation itself
- VA contracting preference through Veterans First Program
Related Terms
WOSB (Women-Owned Small Business) • 8(a) Business Development Program • Set-Aside Contract • SAM.gov
Related Guides
SDVOSB Certification Complete Guide • Veteran Contracting Opportunities
Frequently Asked Questions
What's the difference between SDVOSB and VOSB?
VOSB requires any veteran ownership. SDVOSB requires owner to have VA disability rating. SDVOSB provides more set-aside opportunities but has stricter qualification requirements.
Do I need to be a small business to qualify for SDVOSB?
SDVOSB designation itself has no size requirement. However, to use most SDVOSB set-asides, your business must meet SBA small business size standards for your industry.
How much does SDVOSB certification cost?
VosB certification is free through the VA. However, you'll likely want to work with a consultant ($500-$2,000) to prepare your application.
Can I lose my SDVOSB certification?
Yes. If ownership changes, the veteran sells the business, or VA disability rating is removed, you lose SDVOSB status.