APRIL 24, 2020

News Roundup for Small Business Owners

The latest news about relief efforts for small businesses, particularly via the Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL).

• And it’s over before it starts. Kinda. Lenders are already saying the replenished PPP funding is gone, but what they are really saying is that the money will be used by those who’ve already applied. So if you applied in Round 1 and didn’t receive one, don’t panic yet. However, if you didn’t apply in Round 1, it looks like you probably won’t be able to get into Round 2. That said, I see no reason not to apply in case there’s a Round 3. Or 4. Or 5. As for the the SBA, in a joint statement with Secretary Mnuchin today, Administrator Jovita Carranza said the SBA will resume accepting applications Monday at 10:30 a.m. EST. (CBS News, Treasury.gov)
• In business, it’s about who you know. We’ve all heard it a million times. Doesn’t mean it should be that way. NBC reports three companies with ties to the President received $18.3 million. The article also highlights several other cases that seem, well, fishy at best. They quote the Executive Director of the Main Street Alliance to say, “The entire program was set up to benefit well-connected, well-banked businesses.” (NBC)
• The article has another quote, that I would like to highlight. A small business owner who did receive a PPP loan, Dr. Lulu Hoskins, who with her husband owns a medical practice, said, “So many people got loans that didn’t need them and it hurts people like me who are small business. We were so fortunate. You just don’t know how big of a help that was for us and our business.” The point is: many if not most of the people who got a PPP are legitimate and shouldn’t be lumped in with the companies who cheated. We highlighted a couple such stories earlier today as well. (NBC, Masterplans)
• In a move that will just further frustrate business owners, the Treasury Department issued yet another update to the interim final rule today. I understand how frustrating this is for business owners. They clarified that hedge fund and VC groups whose purpose is “primarily investment or speculation,” are ineligible. There’s still a lot of questions about VC-backed businesses and the definition of what’s an affiliate. Bottom line: you must prove that the loan was out of necessity and if you can’t, repayment before May 7 will give you “safe harbor.” (Treasury.gov)
• I wanted to pass along some more advice for business owners who received loans in Round 1 (and those who will get loans in Round 2) as far as tracking and reporting is concerned.

Previous Entries:

Thursday, April 23 | Wednesday, April 22 | Tuesday, April 21 | Monday, April 20 | Friday, April 17 | Thursday, April 16 | Wednesday, April 15 | Tuesday, April 14 | Monday, April 13 | Friday, April 10 | Thursday, April 9 | Wednesday, April 8 | Tuesday, April 7 | Monday, April 6

Masterplans is a veteran-owned business that specializes in providing the highest-level business development consulting located in Portland, Oregon. For 17 years we have helped thousands of entrepreneurs launch new businesses and put their ideas in motion. Now, more than ever, we want to see these same businesses survive the largest economic disaster of our generation.