Bumble gets help to small businesses faster than Uncle Sam
(Bloomberg) – As lawmakers in neighboring Capitol Hill crafted America’s biggest economic bailout, restaurant owner Simone Jacobson saw her bills pile up quickly. She was already in debt and had no savings. So she turned to the Bumble dating app.
Not to find a date, but to get financing.
After laying off her staff last month, Jacobson said she had about $ 20,000 in monthly fees such as property taxes, security systems and pest control. So on March 25, she applied for one of the $ 5,000 grants Bumble was offering to small businesses run by women. Two weeks later, Jacobson got the money. She plans to use the money to pay two months of health insurance costs for the 28 employees she laid off from her Washington, DC restaurant in Thamee.
“I didn’t have time to wait for government funds, my staff needed to know now if they still had health care,” said Jacobson, 35, who runs his Burmese restaurant with his mother. . “The grant has really been a godsend. Governments and banks are slower machines.
While funds for an unprecedented $ 349 billion federal bailout are to flow more than a week after its April 3 debut, small business owners are using other means of financing to avoid a cash flow crunch. Businesses run by women like buzz and billionaire women like Spanx Inc. founder Sara Blakely are giving millions of dollars in grants to small businesses in need of a lifeline amid the coronavirus outbreak.
This money cannot come sooner. One out of ten small businesses are less than a month away from permanent closure, according to a survey published by the United States Chamber of Commerce. About 56% of these companies support financial relief in the form of direct cash payments.
Businesses run by women and other minority groups are particularly affected because they don’t always have the connections and access to resources that other groups need to survive, according to Elizabeth Gore, co-founder of Hello Alice, a startup incubator that prioritizes women. and other under-represented entrepreneurs.
McKenzi Taylor, for her part, is not optimistic about getting public funds anytime soon, if at all. Taylor, who hosts high-end weddings in the desert and red rock landscapes surrounding Las Vegas, has not heard from the Small Business Administration since he applied for a federal economic disaster loan – a emergency cash advance of up to $ 10,000 – last month.
So, between watching webinars giving small business advice and dealing with clients who postpone or cancel their nuptials, Taylor has spent the last week applying for grants offered by Bumble, the Blakely Foundation and Hello Alice.
“I don’t hold my breath to get government money,” said Taylor, 35, founder of Collective cactus weddings. “So I apply for grants every day so that my business can survive. “
Taylor, a sole proprietor, said she had business costs of around $ 27,000 last month for things like advertising, a virtual assistant, and insurance. She applied for a personal loan from her bank, unemployment insurance and Family and medical leave to cope. Her husband, who runs an event management business, is also not generating any income since the closures.
Bumble, founded by entrepreneur Whitney Wolfe Herd, is offering 150 grants totaling approximately $ 1 million to small businesses around the world, with the first wave of grantees being American restaurateurs and other players in the restaurant business, according to a door. – speech of the company. Blakely from Spanx gives him $ 5,000 in grants foundation to help small businesses run by women. Recipients of the $ 5 million program will be notified in a few weeks, spokeswoman Charlotte Bissell Garner said.
More than 55,000 business owners, regardless of gender, have applied for Verizon Communications Inc.’s $ 2.5 million grant program, according to spokesperson Bernadette Brijlall. to the Local Initiatives Support Corporation to distribute $ 10,000 in grants to over 200 small business owners who are women, people of color and others in historically underserved places. Grant recipients will be announced later this week, Brijlall said.
Small businesses, which account for nearly half of private employment in the United States, are the growth engine of the national economy and their shutdown under lockdown orders has helped historical unemployment claims of 16.8 million in three weeks. About 45% of small businesses are owned by women, a percentage that has increased in recent years, according to a survey of more than 39,000 companies by UENI, a digital platform for small businesses.
Hello Alice, the startup accelerator, is offering emergency grants of $ 10,000 to help them get by. The first recipients – who will be notified this week – will be those who have pivoted their business models for the “Covid-19 market” by producing goods and services for the health system and others on the front lines of the pandemic, co – said founder Gore.
“We want to be useful in this middle gray area,” Gore said.