This episode explores the Paycheck Protection Program as it relates to venture backed small businesses. Zac Dearing is a J.D. Candidate at Harvard Law School and Venture Fellow at AlleyCorp. Zac has a deep appreciation for start-ups and small businesses starting when he was 12 when he founded and ran his own computer assembling business. He has gone on to have quite the career in consulting, finance, and technology.
Here is a link to Zac’s tool for companies to understand how much government assistance they could expect to receive from PPP.
You are also welcome to follow Zac on Twitter @zacdearing.
In this episode we discuss -
- What is the PPP / SBA Loans program? How did Zac become interested in learning about PPP? Who is the program intended for? What types of businesses should apply?
- What makes a company eligible for PPP? What’s the affiliate rule? How can companies change their governance terms with VCs in order to become eligible? Does the affiliate rule only concern those that own a certain percentage of the business?
- What has been VCs response to the affiliate rule? Are venture backed companies eligible? Does he see any potential change regarding PPP eligibility regarding the affiliate rule? Will a business need to repay the loan? What’s the forgiveness factor?
- What does the good faith certification of necessity mean? Where does one apply? Are all payroll costs eligible?