APRIL 28, 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).

• According to the SBA, after about a day-and-a-half of PPP Round 2, 475,000 PPP loans have been approved totaling $52 billion. That maths out to about $110K per loan, which is half of what was reported in Round 1. (New York Times)
• Lenders continue to be frustrated with the E-Tran system. The SBA continues to claim that the issues are intentional pacing allowing no more than 350 applications from any one lender per hour. Banks are saying they are repeatedly kicked out despite not getting near this threshold. Giving credence to the banks’ argument, the SBA stoped allowing Robotic Processing Systems (RPAs) that were burdening the system. This tweet from the CEO of Grand Rapids State Bank kinda says it all:

• The second Round of PPP funding featured dedicated funding for banks with less than $10 billion in assets. That money has been depleted already. There was also dedicated funding for banks with between $10-$50 billion in assets, and that funding is about one-third spoken for. (@zachary via Twitter)
• Yesterday it was reported that the House would reconvene next week, and begin discussing a CARES Act 2. Today, they have walked that back after consult with the Capitol physician. No new date has been announced, except that they hope it will be soon. (Politico)
• Senator Warren and Representative Ocasio-Cortez have teamed up on a proposal that would prohibit large businesses from acquiring small businesses for the foreseeable future. The proposal is specifically aimed at companies with over $100 million in revenue or funds with $100 million capitalization. Warren said, “Large companies and private equity vultures are circling for a chance to gobble up these small businesses and increase their already immense economic power.” While this is probably a non-starter for the Republican Congress, it does indicate where the debate may be headed in terms of regulations on larger businesses. (NBC News)
• After the fallout from the Lakers PPP loan (although it will be returned, it put a stain on the program and the team — go Blazers!), Treasury Secretary Mnuchin announced that there will be audits of any PPP loans in excess of $2 million. Forbes put out a list of the public companies who are returning their PPP loans. (Politco, Forbes)
• Geographically, where did the funding for the PPP go? Well, according to a study by the National Bureau of Economic Research, PPP loans didn’t go to areas that were most affected by the pandemic. You can also check out the original paper which has a lot of interesting charts. The key finding is that in areas with the most shutdowns, 15% of small businesses received funding, while 30% of businesses in areas with the least shutdowns received loans. (MarketWatch)

Previous Entries:

Monday, April 27 | Friday, April 24 | 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.