CARES Act Part II: Revisiting the Paycheck Protection Program

A roundtable with experts on the current state of PPP loans and a conversation with small business owners about their real experiences with PPP

The Paycheck Protection Program (PPP) had its issues the first round. Parts of the process were confusing and frustrating to small business owners, and the funding went quickly.

Then, the federal government passed a second round of PPP loans totaling $320 billion with a launch that has been almost as messy as the first. Many small businesses have more questions than answers, and aren’t sure how to navigate the complexities of the program. 

Editor’s Note: As of May 10, $120 billion in funding remains.

What’s different about this round versus the first round? How should we approach lenders as small business owners to capitalize on this opportunity? What are some barriers or challenges we can expect going through this process? 

To work through this ambiguity, we’re bringing back a group of experts who enlightened us the first time around on the ins and outs of the PPP and asked for an update on what’s going on with the PPP now. 

Watch our roundtable with John Stanford, Policy Director, Association for Enterprise Opportunity (AEO), Brian Peters, Partner, The Franklin Square Group, and Ashley Heineman, Director of Global Policy at GoDaddy:

I also spoke with small business owners who gave their opinions about the PPP’s second round. One business owner I spoke with decided not to apply for PPP, one applied and is waiting to hear back, and another business owner applied and received funding. We discussed why they did or didn’t apply, the opportunities they’re grasping during COVID-19, and their advice for other entrepreneurs out there. 

Watch my conversation with Lizzy VanPatten, owner of rock climbing business, She Moves Mountains, Yolanda Owens, owner, Iwi Fresh, a farm-to-skin spa, and Kevin Malcolm, who co-owns Frite & Scoop, a craft ice-cream shop, with his wife, Lisa.

For many, solely relying on the PPP isn’t a great way to mitigate risks. Lizzy VanPatten is an entrepreneur who runs a rock climbing company called She Moves Mountains, and lives in Bend, OR. She didn’t apply for a PPP loan because she says it didn’t make sense for her business, which mostly employs independent contractors and doesn’t have a physical address. 

She Moves Mountains

At first, she says, there were feelings of stress and helplessness, but that quickly transformed into creativity and resilience. 

“At first, I felt incredibly alone, all the decisions were mine to make and all of the people that work for me were mine to support,” says Lizzy. But, “I’m somebody who moves throughout the world with a lot of transparency. So, I shared what I’m up against with the people who follow us and follow me personally on social media.” 

After sharing what she and her business were going through, she started selling hats with optional donations as well as gift cards. Lizzy says that the amount of donations they received covered the payments that she made to her employees to keep them paid through the month of April. She’s grateful that she leaned on her community and they were there for her, making her feel less alone. 

Lizzy shared her advice for small business owners going through this and who might not be eligible for PPP:

Stay resilient, be creative, and humble yourself enough to ask for help. People are so understanding right now of the situations that we’re facing,” she says, “but they can’t help you if they don’t know you need it.

Yolanda Owens is the owner Iwi Fresh, a farm-to-skin spa in Atlanta, GA. She’s been running her business for a number of years and has brought in employees to support her with selling sustainable and healthy beauty products and experiences. 

Yolanda Owens

But when COVID-19 hit, Yolanda chose to close down her shop. They offer services like massages and facials, which involve very close contact. If she stayed open, she says she would be putting her customers and their loved ones at risk and didn’t want to expose her employees or community.

With the business closed, Yolanda’s sales dropped dramatically. She still kept her employees on payroll because, “they’re like family,” she says. But, her savings started to run dry. Landlords started to knock on her door for rent.

She turned to the PPP for relief. The first round came and went, and she felt abandoned, confused and frustrated by the process. She had to work with her accountant and spent many hours organizing paperwork to apply. 

When the second round came, she wasn’t sure she’d try to apply again, after what happened the first time around. But, thanks to some encouragement, she reapplied and is still waiting to hear back from her lender.

You got nothing to lose, so you might as well reapply, she says. Just sprinkle some love around it, some good vibrations around it, and pray and hope you get some money.

There was some hope for Yolanda in the midst of COVID-19 though. Some Whole Foods locations in Atlanta just started selling her products. The day they hit the shelves, she put on her mask and stood in line with her team. They all wore Iwi Fresh t-shirts. “They already had our little barcodes already positioned for our products,” she said. “We were so excited, and I did a dance.”

Kevin Malcolm co-owns a craft ice cream shop in Astoria, OR called Frite & Scoop, with his wife, Lisa. Located in a small coastal town in Oregon that mostly relies on tourism, the shop shifted to offering pick up and delivery of their products, which they have never done before. 

Frite & Scoop

They ended up applying to the PPP because as Kevin says, “at this point any money is probably better than none if we’re trying to stay open.” “Luckily,” he adds, “we have a local banker who we know and knows us and knows our business and worked hard for us.”

This strong relationship with their banker paid off. He fought for them during the PPP process, and they eventually got their money. 

Now though, the worry for Malcolm and his wife is whether a majority of the loan will constitute a grant. They’re hopeful, but there’s still an air of uncertainty because if the loan isn’t forgiven, it could jeopardize their business. Generally, Kevin says that his advice for small business owners is, “apply for everything.” You never know if you could get the loan, and having it in your bank account could make things slightly less stressful. 

News about PPP is constantly evolving, but there is help out there. If you need more information about the program, check out GoDaddy’s webinar with Next Street, or get help from our #OpenWeStand partners on how to apply.

It can be dispiriting hearing the news that even this round of PPP funds are running out quickly, that the process is challenging, and that the loans are often not getting to the small business owners who need it most. But, maybe hearing the stories of these business owners can provide a glimmer of hope that more positive scenarios for everyday entrepreneurs are still to come. 

Check back for more conversations with GoDaddy’s entrepreneur-in-residence, Scott Shigeoka. He’ll be chatting with industry experts and sparking conversations about the issues that are impacting us most during these challenging times.

The information contained in this blog is provided for informational purposes only, and should not be construed as an endorsement or advice from GoDaddy on any subject matter.