Unsurprisingly, numerous SBA PPP Loan calculators have appeared on the web. Many of them are tied to a specific bank and have various complexity (or simplicity) in determining the amounts available. We’ve tried a few of them for comparison and found the calculations to be inconsistent.
So, we created our own and validated it with a number of accountants and lawyers. As the rules changed (and they continue to change), we updated it so we believe that it is current as of 4/8/20.
I’m going to refer to it as the Mostly Simple, Super Clear, SBA PPP Loan Estimator. It’s a Google Sheet, so if you want to use it, just click the link above, make a copy, and do whatever you want with it.
Please note the Disclaimer: this simplified model is meant to provide a quick, rough estimate the size of potential PPP loans and forgiveness amounts for planning purposes. Actual loan and forgiveness amounts will be determined by your bank based on federal law, regulations and bank implementation policies. Please consult your bank’s calculator and program paperwork to determine actual loan and forgiveness amounts.
My partner Seth Levine recently put up an extremely thoughtful post titled SBA PPP Loans Aren’t for Everyone. Go read it now – I’ll be here when you get back.
Seth references two other posts to read and consider. The first is by Albert Wenger at USV titled VC Backed Startups and PPP: Do You Really Need It? The other is an OpEd for CNBC written by Seth and Elizabeth Macbride titled Stampede for emergency loans is crushing lenders, putting millions of small businesses at risk. Here are steps to fix the system.
The complexity around both the PPP loans and the implementation of them is staggering. I can’t begin to estimate the number of hours spent collectivity just across our portfolio on trying to decode the rules, figure out how to comply, decide on a company by company basis if they should apply, and work through all the legal dynamics around them. On top of that, the mismatch between the expectations of dollars flowing quickly to the reality of the application process is dramatic.
We believe that many VC-backed companies will look at their businesses and determine that there is a clear and real need for the funds offered through PPP. But we’re encouraging all of the companies in our portfolio to pause and consider whether they truly qualify for the program and whether their participation in the program will save jobs and result in their business being less threatened by the crisis.
We understand that there will be many companies that fall into a grey area, have no way of predicting how serious the economic downturn will be, and how much it will impact their business. Hard calls will need to be made but we’re encouraging companies to make them with thought and compassion.
We sent the following email to all the CEOs in our portfolio last Friday. After discussing internally, we felt it was relevant to share publicly.
First of all, we can’t begin to tell you how impressed we’ve been with the leadership that you have all exhibited over these last several weeks. These are very challenging times both personally and professionally and these are the moments where true leadership is demonstrated. We sincerely thank you for the thoughtful and compassionate approach you have all taken during this crisis so far.
We had over 70 participants on the CARES Act/SBA/PPP call last night and we’ve had countless one-on-one conversations on this topic with many of you over the last few days so we know there is a lot of anxiety around the application process at the moment. The high anxiety levels appear to come from a mix of excitement and uncertainty which is certainly understandable because both components are clearly at play here. Although we can’t immediately relieve the anxiety, we strongly encourage you to take a few deep breaths and step back for a moment of reflection.
As you reflect, we think it is important to start by asking yourself “Was this relief package created for my company?” We’ve heard many of you talk about how attractive the economics of the loan could be for your company. The term “free money” has been tossed around more than a few times. We’ve also heard plenty of excitement around how simple it could be to qualify in part because the qualification requirements are both broad and ambiguous. However, the reality is that receiving a loan for your business means it isn’t going to another business that might also deserve the money so receiving a SBA loan does come at a cost to the broader small business community. Given the already mentioned ambiguity, we can’t, unfortunately, rely purely on the letter of the law to make this qualification decision for us. We all have to apply our social conscience and good judgment to come to the right answer. From Foundry’s perspective, we believe PPP was designed to accomplish two things:
- Save jobs
- Stop businesses from failing that are gravely threatened by the current crisis
No doubt that all of our companies would benefit from more cash with attractive loan terms on the balance sheet so it isn’t surprising that the majority of you are considering applying for the loan. At the same time, we know that many of you have not eliminated jobs or have no immediate plans to eliminate jobs at the moment. If you aren’t definitely planning to eliminate jobs, should you apply? Will your business likely fail without this loan?
As the application process is currently written, you (and perhaps your affiliates) will have to certify “Current economic uncertainty makes this loan request necessary to support the ongoing operations of the applicant.” This statement is highly ambiguous and could be interpreted in numerous ways. We’re sure most of you could easily rationalize this statement to be true. At the same time, providing false information in this application is a federal crime that includes jail time. In addition to your social conscience, you should have real conviction and certainty that you qualify in your own hearts and minds.
If you have a strong balance sheet, have recently raised money, or have some certainty around a near-term capital raise, we think you should reconsider applying. Although things are chaotic at the moment and it might be possible to take advantage of a lack of controls in the system, that doesn’t mean we should necessarily do so. Imagine for a moment that three years from now, the WSJ or FBI does a deep forensic analysis on the small businesses that received loans during the crisis. Would you feel good about the details of your situation being revealed in that process?
You are all proven leaders who have repeatedly demonstrated the ability to take a thoughtful and compassionate approach to decision making. While we all sort through the details and logistics of the loan application process, we encourage you to take a step back and remember to consider the big picture.
The CDC finally issued guidance to Use of Cloth Face Coverings to Help Slow the Spread of COVID-19. If you go out in public, please wear a “Cloth Face Covering.”
I’m using every ounce of energy that I have to avoid talking about the politics of any of this. Rather, I’m focusing on actionable things with clear reasoning for them.
Before I explain why this is so important, here are two websites that clarify the types of face coverings I’m talking about. Specifically, these are homemade (or DIY) cloth face coverings.
Colorado Mask Project: Provide all Coloradans with DIY masks to help slow the spread of COVID-19.
You do not need an N95 mask. You do not need a surgical mask. You do not need a mask you buy in the store. You just need a cloth face covering that you can make yourself at home.
There has been endless discussion about the efficacy of masks in general, and more specifically for “the public.” There are plenty of recent credible discussions about this from sources like the American Association for the Advancement of Science (Would everyone wearing face masks help us slow the pandemic?). Feel free to wade through all that stuff, but here’s the punch line.
The Main Benefit: If you are asymptomatic or pre-symptomatic, you can spread the virus to healthy people. This means that even if you don’t have symptoms, you are sick and can spread the virus to others. When you are wearing a mask, it helps prevent you from spreading the virus to others. The virus spreads through droplets coming from your mouth and nose. If your mouth and nose are covered, the cloth mask catches the droplets when you sneeze, cough, breathe, and talk.
Secondary Benefit: We touch our faces thousands of times a day. The virus lives on surfaces for a long time (possibly up to 72 hours) and in the air for an indeterminate amount of time. We are constantly touching things the virus settles on. Then, when we touch our face (especially our eyes, nose, or mouth), we infect ourselves. A mask lowers the propensity for us to touch our own face (it’s an interesting psychological phenomenon).
Tertiary (and unclear) Benefit: A debate rages on about whether a cloth mask acts as an effective physical barrier to breathing in the virus. If it does, with any level of efficacy, this is merely a bonus to the first two benefits.
I think the best paragraph from the Science article Would everyone wearing face masks help us slow the pandemic? is:
But the greatest benefit of masking the masses, Cowling and others argue, likely comes not from shielding the mouths of the healthy but from covering the mouths of people already infected. People who feel ill aren’t supposed to go out at all, but initial evidence suggests people without symptoms may also transmit the coronavirus without knowing they’re infected. Data from contact-tracing efforts—in which researchers monitor the health of people who recently interacted with someone confirmed to have an infection—suggest nearly half of SARS-CoV-2 transmissions occur before the infected person shows symptoms. And some seem to contract and clear the virus without ever feeling sick.
Right now, you have no way to know if you are infected when you aren’t showing symptoms, and given that it’s springtime in the US many people will have allergies so it’s even harder to tell who is sick. Given the completely inadequate testing activities right now in the US, along with lack of contact tracing apps, effective isolation for people who are sick, and the overall challenge of getting everyone to actually stay at home, by wearing a mask in public, you are protecting other people from you in case you are infected.
Finally, please do not buy or use medical-grade masks. There is still a huge shortage of these in the health care system and it’s expected that the shortage will continue. You’ll hear phrases like “surgical masks” and “N95 masks.” You do not need to wear one of these – they are needed for our front line medical workers.
Instead, make your own mask. And wear it whenever you leave your house.
While everyone I know feels the weight of being in the midst of the Covid crisis, we are actually dealing with the overlap of three linked crises. Understanding this, and putting it in historical context, has been helpful to me as I process real-time inputs and prioritize my activities.
The three crises are (1) a health crisis (Covid-19) that has generated a (2) financial crisis, each of which has generated massive societal disruption which will generate a (3) mental health crisis.
In addition, these are both localized (in a community), at a state level, a national level, and a global level.
Yeah – that’s a lot.
Very few people alive today have experienced a health crisis like Covid-19. The closest one that people seem to reference is the 1918 Spanish Flu. That was 102 years ago. Assuming that you have to be about 8 years old to even remember this, that puts the age of people alive who remember this at 110. There are only around 100 people alive on the planet today who are 110 or older.
I’m 54. The closest analogy I have to this is HIV / AIDS, which broke out when I was in college (I was an undergraduate from 1983 – 1987). I lived in Boston, one of the cities where HIV / AIDS was visible, and the social dynamics, politics, and stigma around it were front and center. I had several close friends with HIV and my fraternity big brother died of AIDS in 1990. Around 700,000 people have died of AIDS in the US since it emerged in the early 1980s, which is a large number. However, in contrast to Covid-19, it was a very slow-moving virus, so the experience has echoes for me, but it’s not equivalent.
I’ve been through multiple financial crises. I remember Black Monday in 1987 (I was running my first company – Feld Technologies – in Boston.) I was decimated in the collapse of the Internet bubble and had an extremely rough business experience from 2001 – 2006 (which I lovingly refer to as “The Grind”). We started Foundry Group and Techstars just prior to the Global Financial Crisis of 2008 – 2009 and when I look back, was the moment in time our business world shifted from massive hierarchies to a different long term system that included networks, entrepreneurship, and the democratization of innovation. Oh, and the emergence of startup communities around the world.
I’ve been through many of my own mental health struggles and learned many things about how to manage my own issues, as well as being sensitive, empathetic, and understanding of others.
That said, we are in a moment when all three are colliding against a backdrop of fear, uncertainty, and isolation. Historical rules about things are being thrown away daily as we all try to adapt and adjust to an extremely fast-moving disease that is impacting every nook and cranny of our lives.
If your level of disorientation and anxiety feels extreme relative to what you’ve experienced, understand that we are – collectively as a society – trying to deal with three crises at the same time.
I’m involved in many things around this and am trying to help wherever I can. But, as several of my partners have reminded me, you have to take care of yourself first to be able to help anyone else. I’m fortunate to have Amy by my side, working hard also, but paying attention to what we both need to sustain our energy and focus through this.
Finally, this is not just going to “be over.” That’s magical thinking. There will be many different phases of this, but if you prepare for a long-term experience, you’ll be in a much healthier emotional place. I personally believe that April is going to be an awful month in the United States as the true extent of the health crisis finally hits in our country. The actions we are taking right now will determine whether April is the worst of it, but know that May will be rough, and the summer will be unlike “a normal summer” as, even in the best case, we being existing in the context of meaningful long-term societal adjustments.
This rant was meant to be pragramatic, not alarmist. I’m fundamentally optimistic about humanity, and especially optimistic about the United States over the long-term. But, I believe acting aggressively and with urgency today, and having an expectation that this will last for a while, is a healthy way to approach all three of these crises.
A creative group of Boulder entrepreneurs, led by Vikas Reddy and Kyle Judah and inspired by San Franciso entrepreneurs/investors Frank Barbieri and Ryan Sarver have created and put into action a program that supports both frontline health workers and local independent restaurants.
They’ve created a program called Feed the Frontlines Boulder that lets the community donate meals from local restaurants to health workers on the frontlines. Health workers get a nourishing meal, and local restaurants get badly needed business to keep running and keep staff employed.
Feed the Frontlines Boulder was conceived and implemented in a week. We have one month of meals paid for through an initial contribution of $200,000 from me and Amy Batchelor, Dan and Cindy Caruso, John Goldsmith, and an anonymous donor.
We are now looking to raise another $200,000 for month two of Feed the Frontlines Boulder.
100% of the money goes to local restaurants. The first restaurants participating are Salt, Big Red F Restaurant Group, Kitchen Next Door, Japango, Blackbelly/Santo, and Community Kitchen Table. The food services partner at the hospital, BCH Food Services, has generously offered their trained staff and facilities to help receive, distribute, and store the meals delivered by the restaurants.
I’m blown away by the generosity and execution around this. I love that we are doing something to take care of our frontline hospital workers at BCH who are putting in an incredible effort around the Covid crisis that I expect to be extremely intense in April. And, I’m psyched that we are buying meals from local Boulder restaurants.
Following are three links in case you want to contribute in some way:
- Contribute financially to the Feed the Frontlines Boulder Fund
- Are a restaurant in Boulder County and want to participate
- Want to Feed the Frontlines in your city
We depend on our frontline hospital workers right now. And, we all want to see our local restaurants survive this crisis, especially the short-term shut down of their businesses. If you have the resources or the interest, please help any way you can.
Governor Jared Polis had an excellent and extremely data-driven press conference yesterday to provide quantitive support for his stay at home order (among other things.) The presentation is embedded and worth paging through.
The basic message is that unless it is absolutely necessary for you, please stay at home to prevent the spread of the virus. While it is frustrating and constraining in the short term, if you stay at home, your actions will contribute to saving many lives. If not, your actions will contribute to killing people. I know that’s a harsh statement, but the data shows that we are clearly in the middle of a relatively short period where our collective action of staying at home can have a huge positive impact.
There is a new, private-sector volunteer organization (and a non-profit) called Citizen Software Engineers (CSE) run by Tim Miller (you may know Tim as the Rally Software CEO from near inception through their acquisition by CA) that is part of my Innovation Response Team. CSE has a data team that is generating significant data around Covid-19 and wiring up publicly available data in a system for rapid feedback, analysis and response.
The actual data is extremely fast-moving and anyone familiar with complex systems or system dynamics knows that today’s inputs generate tomorrow’s outputs which are the new inputs. So, the action we take immediately can have profound positive or negative effects on what happens next.
Jared completely understands this and is using all the data he has to make decisions that have both short-term and medium-term impact. Right now we are in the middle of what I am calling “the surge” to help people I’m working with understand that the next 30 days (through the end of April) is a critical/urgent time to act since we didn’t act as a country 60 days ago.
While many things are setting the groundwork for dealing with Covid19 over a longer period of time, I’m not counting us a magical solution to this. Consequently, our actions every minute, every hour, and every day will make an impact on the magnitude of the surge, and whether we can flatten the curve enough so that we can handle it in Colorado.
Please do your part and stay at home. I know it’s tempting to go outside today, especially given the beautiful weather. I know it’s natural to say “fuck it” after a cooped up week and go for a hike. Understand the constraints of the stay at home order and follow them. Please. You will be saving lives.
Amy and I recently joined a campaign created by Dave and Suzanne Hoover to fund a $100,000 match for the Impact on Education Foundation for Boulder Valley Schools Critical Needs Fund.
School closures due to COVID-19 have a direct impact on BVSD students and families. This fund supports BVSD food services to ensure families receive nutritious meals. It also provides school supplies to assist with at-home learning.
On Monday, I talked about our matching gifts to Boulder Community Health Covid-19 Relief Fund and the Covid-19 Response Fund Boulder County. Both funds have happily completed their match, but are continuing to raise additional money. They are both Covid-19 Relief Funds to consider if you want to support immediate and high-impact activity in Boulder.
Amy and I are continuing to work with specific organizations and volunteer teams in Boulder County on creative and immediate matching campaigns. We have at least one more coming next week, but if you have financial resources, please support anything that appeals to you.
If you are looking for specific organizations to fund, the following are some that Amy and I are long time supporters of that have an immediate impact in Boulder County, organized by the category they address.
If you want to see all the organizations Amy and I support, take a look at our Anchor Point Foundation site. But the ones listed above are the ones we think have an immediate impact.
If you have any others to suggest, or know of active campaigns in Boulder County highly relevant to the Covid-19 crisis, please put them in the comments.
Every day counts right now in the Covid fight, so if you have resources and the inclination to give, please do.
In addition to his leadership at Foundry, the companies he’s involved in, a number of initiatives in Colorado generally and Longmont specifically, and with his family, my partner Seth Levine has written several excellent posts in around the Covid Crisis.
His first, Dealing with evolving information about Covid-19 was deeply personal and explained why it is so important to “being open to new and evolving information is so critically important in a time when what we know about Covid-19 is changing so rapidly.”
Then, he had a post about Decision making in uncertain times. He explored several ideas: Don’t Panic, Move quickly but don’t rush, Prioritize, Be comfortable with ambiguity, You can’t control what you can’t control, and Make contingency plans. This helps explain why even though we want to make the “right” decision, we should endeavor to make the “best” decision since the idea of “right” doesn’t exist in times like these.
At the end of last week, which feels like several months ago, he has a series of practical thoughts for all CEOs that were a synthesis from all the stimuli of that week. And yesterday, as layoffs are starting to roll out extensively across all types of businesses in the US, he had a series of tips for anyone who is job hunting in the midst of a crisis.
Seth has really found his writing voice in the past few weeks. He’s always been an excellent writer, but I’m finding incredible value in many of the things he’s saying, both privately (inside our partnership) and publicly (on his blog) as we all do our best to help out in this crisis. I encourage you follow him and read everything he’s putting out right now.
My friends at Formlabs have launched a Formlabs Covid-19 Network and are working on numerous 3D printable solutions for the crisis. As of this morning, 800 people have already signed up to participate.
My premise around 3D printers when we made our first investment in 2010 in MakerBot was that ultimately everyone would want a 3D printer on their desktop. I thought this was especially true in prototyping, experimentation, and emergency situations.
Given the Covid-19 pandemic, my sense is that every hospital in the world should have multiple 3D printers. New 3D designs for the crisis, ranging from conversion kits to face shields to masks to respirator parts, are appearing daily.
Makers are rallying around this. In addition to the Formlabs Support Network for COVID-19 Response, I just joined the Make4Covid community of makers working on 3D printed medical equipment for Colorado healthcare professionals.
It’s awesome to me to see all of these efforts spinning up around innovation in this crisis. If you have other 3D printer related initiatives that you are aware of, please put them in the comments.
It’s amazing the havoc a 120-nanometer organism can wreak on the human race. Someone said that every 24 hours feels like a week. That would put us at the end of the school year, which kind of feels like what has actually happened.
I expect this week will be as intense as last week. While there was almost no positive news last week on any front, I feel well organized around the things I’m working on.
At Foundry Group, my partners and I spent most of our week focused inwardly on our portfolio, individual companies, supporting our partner funds, and providing as much content and connection as we could across all the companies in a rapidly changing environment. We have an awesome community of CEOs and GPs who are deeply connected to each other, so collective situational response and action happened fast. While this week will be more of the same, we feel very aligned on what is going on.
I’ve decided to focus all of my government-related energy on helping at the state level in Colorado, especially around business and innovation. I’ve agreed to be on the Economic Stabilization and Recovery Council responsible for small businesses, minority and women-owned businesses, entrepreneurial businesses, and rural entrepreneurship. I’ve also agreed to chair the Innovation Response Team. Both of these teams spun up over the weekend and have kicked into gear. More soon as we try to get ahead of everything coming at us.
Amy and I have decided to focus our philanthropic resources in Colorado with a focus on healthcare, food, and economic stabilization. So far we’ve announced three major grants and campaigns: Boulder Community Health Covid-19 Relief Fund, Covid-19 Response Fund Boulder County, and the Colorado Covid Relief Fund. More are coming this week. The organizations desperately need funding now so if you have resources, please contribute – any amount is appreciated.
Finally, I’ve re-engaged on Twitter, Facebook, and Linkedin as communication channels. While I’m not watching the stream, I’m broadcasting what’s going on and trying to respond to anyone who messages me directly.
Our world is in a crisis unlike any I’ve experienced in my life. I’m trying to focus my energy on areas I can help the most. If there’s anything I’m doing that you want to help with, please reach out and I’ll try to plug you in.