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Since we're sharing anecdotes... Anecdotally of the handful of business owners that I know personally who received PPP funds (3 businesses total), all needed t

Since we're sharing anecdotes... Anecdotally of the handful of business owners that I know personally who received PPP funds (3 businesses total), all needed the loan, used it to maintain payroll, and all of them had their loans forgiven.

vkou 4y ago
Since we're sharing anecdotes, anecdotally, the only business owner I know personally who received PPP funds (My wife's employer) needed the loan, kept everyone on the payroll, paying them to do nothing, until PPP funds ran out, and once that happened, laid off half the staff. He then continued running the business at a loss, paying out of his own pocket for the next year and only now has returned to something resembling profitability. Why was the business operating at a loss? Because of the social changes brought about by COVID, it took over a year after the mandates were lifted for his customers to return to the status quo.
- Scoundreller 4y ago
  > He then continued running the business at a loss, paying out of his own pocket for the next year The year-by-year outlook of profit vs loss is arbitrary. How did the decade by decade history look? Any losses? Why not look at businesses second by second? Sometimes you’ll lose in 1 second what will take thousands of seconds in profit to make up. Largely corps distribute their profits to protect past earnings against future losses, but risk short-term insolvency which should be at their own risk. Likely they funded the ongoing survival of business because walking away from its equity value would have resulted in greater losses.
thwayunion 4y ago
You're both right. I know of 10 cases in my social circle. Two were small tech companies (not startups) that pivoted to WFH services in 2020, had their best years ever, and then returned to their normal work portfolio in 2022. Good years. Five were restaurants I frequent. Two of those went out of business, two used PPP to pay salaries then laid folks off, and one had a fantastic year because they already had eds+meds+tech clientelle, were in a fairly good pandemic-weathering of the city (lots of SFHs and huge parks), and executed extremely well on the "delivery but we'll keep the social third place vibe going with various virtual events" model. One is a auto dealership (well, a manager at an auto dealership). Basically used the PPP to pay salespeople salaries for a few months and by the time the first summer came around it was back to business as usual. The rest were various other small businesses for whom PPP was basically purely supplemental income. The only one I'm really sour about is a tradesman who did a bunch of under the table cash work (unreported so a 30% boost already) + got PPP + got enhanced unemployment. Almost two straight years of tax fraud. Bought a $300K boat and bunch of other toys this year. All were forgiven.
- vkou 4y ago
  > All were forgiven. Snitch on the tradesman, and you'll get 30% of whatever he stole if he's convicted.

vkou 4y ago

Since we're sharing anecdotes, anecdotally, the only business owner I know personally who received PPP funds (My wife's employer) needed the loan, kept everyone on the payroll, paying them to do nothing, until PPP funds ran out, and once that happened, laid off half the staff. He then continued running the business at a loss, paying out of his own pocket for the next year and only now has returned to something resembling profitability. Why was the business operating at a loss? Because of the social changes brought about by COVID, it took over a year after the mandates were lifted for his customers to return to the status quo.

Scoundreller 4y ago
> He then continued running the business at a loss, paying out of his own pocket for the next year The year-by-year outlook of profit vs loss is arbitrary. How did the decade by decade history look? Any losses? Why not look at businesses second by second? Sometimes you’ll lose in 1 second what will take thousands of seconds in profit to make up. Largely corps distribute their profits to protect past earnings against future losses, but risk short-term insolvency which should be at their own risk. Likely they funded the ongoing survival of business because walking away from its equity value would have resulted in greater losses.

thwayunion 4y ago

You're both right. I know of 10 cases in my social circle. Two were small tech companies (not startups) that pivoted to WFH services in 2020, had their best years ever, and then returned to their normal work portfolio in 2022. Good years. Five were restaurants I frequent. Two of those went out of business, two used PPP to pay salaries then laid folks off, and one had a fantastic year because they already had eds+meds+tech clientelle, were in a fairly good pandemic-weathering of the city (lots of SFHs and huge parks), and executed extremely well on the "delivery but we'll keep the social third place vibe going with various virtual events" model. One is a auto dealership (well, a manager at an auto dealership). Basically used the PPP to pay salespeople salaries for a few months and by the time the first summer came around it was back to business as usual. The rest were various other small businesses for whom PPP was basically purely supplemental income. The only one I'm really sour about is a tradesman who did a bunch of under the table cash work (unreported so a 30% boost already) + got PPP + got enhanced unemployment. Almost two straight years of tax fraud. Bought a $300K boat and bunch of other toys this year. All were forgiven.

vkou 4y ago
> All were forgiven. Snitch on the tradesman, and you'll get 30% of whatever he stole if he's convicted.