Survey results: How CEOs are navigating the PPP
Over the course of the last few weeks, CFO Strategic Partners has been helping more than 100 clients work their way through the Paycheck Protection Program (PPP)—and we’ve seen firsthand the program’s frustrations and limitations.
Business are still waiting for answers, and the fund is nearly depleted. The $350 billion allocated for the program is expected to run out as early as today, April 16, 2020. The SBA has reported it has approved about 1.3 million applications totaling more than $289 billion. Lawmakers have not yet approved additional funding for the program.
We recently put together a survey to see how CEOs are dealing with the PPP. Nearly 60 people responded to our call, and overall, our results reflect much of what we have seen through the process—there is confusion, and people are unsure if they will receive this potentially business-saving money.
Here’s a deeper look at the results.
Nearly all of our 59 respondents have applied for the PPP funding—an overwhelming 91 percent.
The answers we received to question 2 reflect what we’ve heard from CEOs who have attempted the PPP process—there is much uncertainty. Our respondents were nearly equally split, with 40 percent reporting they did seek multiple banks and 50 percent reporting they did not. In our experience, some larger banks were quick to build the needed infrastructure but have been slower to process the volume of applications they received and submit to the SBA. Other owners originally turned to a financial institution with whom they had longstanding relationships only to be told they were not accepting applications or were still working to develop the process. As a result, many business owners did not know where to turn and many began to apply with multiple institutions in order to ensure their application would be submitted to the SBA. Of course, once the first lender submits the application to the SBA, all other applications in process must be cancelled or terminated.
Again, we see confusion with question 3, as 25 percent of respondents reported they were not sure about whether their application had actually been submitted.
The responses we received for question 4 show a further breakdown from the previous responses, giving us a clue as to where many CEOs are in the process at the moment. While 35 percent of respondents reported that they had been approved, nearly an equal number reported not knowing their current status—something that is beginning to cause panic among business owners as funds dwindle.
Again, the results of our survey questions are telling—and alarming. Most of our respondents—84 percent—have not received funding yet. As the PPP fund continues to drain, questions are raised as to what might happen to those business owners who have been approved and are awaiting funds if they are exhausted. Most who have been approved and have received their SBA loan number have been told the funds have been set aside for them, but what happens to those still in the process?
Perhaps the most interesting aspect of our survey, however, were the candid comments we received. Twenty survey respondents took a moment to leave us additional comments as to their journey.
Here, too, we heard echoes of what we have seen with business owners during the PPP process.
Many reflected the idea that who you apply with matters most.
Several respondents reported slow-moving processes with national banks, waiting more than a week to even hear back. Others applied with multiple lenders, reporting that several institutions were overwhelmed by the volume of applicants.
“Submitting to multiple lenders was key,” one respondent reported. “First lender was slow to react and seemed confused about required documentation. Second lender reacted quickly, had us through underwriting and approved before the first lender sent us the requirements.”
“Big banks are slow,” another respondent said. “Local community banks and credit unions were the better route.”
Others reflected the panic of not knowing where to submit an application.
“For sole proprietors—if they did not have an established business banking relationship with a bank, it was a struggle to find a place to even apply,” one leader said.
Many of the comments also indicated there was confusion after finding a bank. Several reported that banks requested additional forms to be filled out, or for the applicant start again and complete forms in a different way.
Those who have received funding showed the promise of the program:
“Unbelievable. Funding in less than a week. Thank you!!!!! It has saved our business,” one comment read.
Even so, many commenters said they expected funding Friday or Monday—and they are left to wait in the face of the current news about dwindling funds.
We, too, are watching this situation extremely closely. Our CFO consulting firm has been in the trenches with more than 100 of our clients from the start of the PPP process, drawing on the collective knowledge of our outsourced CFO team. We have learned which institutions are acting quickly and have been assisting clients to complete the application and get the highest amount of funding possible.
When clients receive funding, our CFO consultants are helping them use it strategically to do the most good for their organizations, and we will help them ensure the largest amount possible is forgiven from repayment.
Wherever your business is in the PPP process, if you have questions, we are here to help. Please reach out to us to see how our team can help your small business survive this trying time and thrive long-term.
Email us at firstname.lastname@example.org or call us at 407-426-8288 to learn more.
NOTE: Given the current evolving economic climate, CFOSP is publishing more frequent communications on this topic based on what our clients are experiencing and our firm’s expertise. Stay tuned for updates or click here for more content on this topic.