PACT Update – What You Should Do – NOW

We are all overwhelmed with the impact of COVID-19 on our personal and professional lives.   We are also inundated with LOTS of information on what we should be doing professionally.  As PACT works to assess all of this information, we share here some quick guidance on what you should be doing NOW – particularly companies with less than 500 employees that are interested in the Federal CARES Act small business programs.

WHAT PACT IS DOING:

  • Lobbying on your behalf at the Federal and State (PA) levels to address important issues affecting startups.  On Tuesday, we spoke with Senator Pat Toomey’s office and shared some of our other efforts below.
  • Dissecting and sharing information that is actionable for companies, investors and professional advisors.   Our regularly updated list of resources can be accessed here.

WHAT YOU SHOULD BE DOING NOW:

FOR FEDERAL PROGRAMS:

  • Companies should call their bank now and find out if they are a current SBA lender.  Even if they are not currently, they may start to process SBA loans as part of the CARES Act.   If they are not a current SBA lender, talk to a bank in the region that already does SBA loans so you can “get in line” for the CARES Act, SBA 7a loan program.
  • Read the National Venture Capital Association guidance and discuss with your professional advisors.  Right now, VC backed companies are largely eliminated from the SBA 7a program due to affiliation rules.   Again, PACT is working hard lobbying with the NVCA and recruiting others to change the affiliation guidance.  Our up to the minute guidance is that the affiliation rules will be waived for most companies.  However, you should start to plan that the guidance may not change.

FOR PENNSYLVANIA PROGRAMS:

  • The Commonwealth of PA has created a $60M pool of capital for small businesses and it is exhaustedClick here to learn more. In addition, this program requires a personal guarantee as well as a 1:1 match up to a maximum loan of $100,000.   We are working hard with others including Life Sciences PA and Ben Franklin to change those requirements for future potential loan pools and make these loans more attractive to startups.  We just had a call with PA Legislative leadership this afternoon to discuss this issue.

FOR CITY OF PHILADELPHIA PROGRAMS:

  • The City of Philadelphia COVID-19 Small Business Relief Fund of $9.25M is exhausted.  Applications are currently being accepted for a future micro grant program for companies with less than $500,000 in revenue.  Each grant will be a maximum of $5,000. Click here to learn more.

If you have updates or insights to share that can be beneficial to companies, particularly validated by your own experts or other credible sources, please share with us.  We will be sending out timely and actionable communication as we get updated information.

Please contact the PACT Team if you have any needs.

Thank you all and be safe!

Dean


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