
Who’s Getting Small Business Funding? We Touch Base With Beauty Entrepreneurs About Their Experiences.
The United States federal government has exhausted almost all of the $670 billion Congress allocated through two rounds of the Paycheck Protection Program to businesses impacted by COVID-19. There could be more money on the way. House Speaker Nancy Pelosi is advocating for a so-called Paycheck Guarantee Act that would reimburse employers for payroll and benefit costs.
After the first round of the PPP, we touched based with beauty entrepreneurs to learn about their experiences applying for public aid. At that time, none of them had received assistance. Now, their experiences are widely divergent. Some have received funds, and others haven’t. To find out more about what’s currently happening with small business support, we asked nine beauty brand founders: Were you able to access capital from the PPP or other programs?
- Rahama Wright CEO and Founder, Shea Yeleen
I've been applying to both the SBA loan programs and grants. Grant applications included the Bumble grant, Local Initiatives Support Corp (LISC)/Verizon grant, Washington, D.C.'s small business grant, U.S. Chamber of Commerce grant and Amber grant. I've faced issues, including websites crashing, grants closing before the due date due to large volume of applicants, and money running out prior to funds being disbursed.
- ROCHELLE GRAHAM-CAMPBELL CEO, Alikay Naturals
Currently, we have not been able to benefit from any of these programs. We did apply for one of the programs, but have yet to hear a response. We find that a lot of small businesses that applied are still waiting on their funds and that major corporations have already received funds, which is just a reflection of what always happens in the economy. Even though small businesses provide the biggest impact as far as jobs in this country, we are always put on the back burner. I do believe that this is why it is important that, as small businesses, we don’t build ourselves to rely on these types of resources. Yes, use them to your advantage while they are available to you, but always have a plan B.
- Cherie Hoeger CEO and Co-Founder, Saalt
We are happy to report we were approved for our full PPP amount and have heard of several other small businesses who were successful. We submitted with our local bank because we had our existing SBA loan through them, and it proved to be a good strategy. I would recommend to anyone still waiting to apply to choose a bank that is an SBA-preferred lender that you ideally have an existing business account with as you'll need to open a checking account with the institution you apply through.
If neither of those apply, I would recommend using a smaller community bank. A recently retired banking VP gave us the advice when we first applied that smaller community banks were doing a much better job processing applications with fast turnaround speed than national banks. You want to choose a banker that you can follow up with quickly and [that can] give you real-time status on your application.
- DANIELLE GRONICH Co-Founder, CLEARstem Skincare
We were fortunately able to access some of the PPP and disaster loans. Our experience was fairly simple with the disaster loan. We just got $1,000 per each employee for CLEARstem Skincare. At San Diego Acne Clinic, we got a solid two-and-a-half months worth of payroll, so thankfully I was able to still take care of my staff. One of them just moved here from New York. She didn't have access to unemployment benefits yet, so the PPP really saved her! As a business owner, this was a huge relief. You do not want your staff struggling at home, and I was very grateful this came through.
- MARIA GIANNOPOULOS Owner, MakeupByRiagia
Applying for unemployment has been an extremely difficult process due to the overwhelmed system in NYC. The SBA did not send me any Economic Injury Disaster Loan (EIDL) funds because, after applying, the government released the guidelines, which stated that they were only sending the grant to businesses with employees on payroll. Sadly, as an independent contractor, I do not qualify.
Fortunately, I applied early enough for the PPP funding and was able to receive some compensation. However, it's a bit frustrating that the application is based on my net income, which is not a true reflection of the money that I make because it is after my expenses and bills are taken into account.
- Triniti Gawthrop Founder, Ami Wellness
We were able to receive federal aid from the PPP. However, throughout the application process, we noticed a few alarming trends. The larger banks are being blocked from the portals with intent to let local banks serve their customers. This is an issue as it assumes local businesses bank with local banks.
Also, there have been allegations that larger banks prioritize customer applications, meaning that bigger customers receive faster application approval. I wish there were more options to help small businesses. It feels like a lottery system, and it can be very stressful for small companies. If we had not received the loan, we planned to reapply with our local bank.
- Allison McNamara Founder, Mara
We have not yet been approved for any PPP loans. However, my other business AMcNamara Inc., did. We purposely keep our business cash-positive with a healthy cash reserve in preparation for difficult times like this, so we are in a strong position to weather this storm. Additionally, we have seen incredible growth online DTC as well as through our retailers. The biggest challenges have been with our retailers extending their payment terms from net 30 to some as far out as net 120.
- Shauné Hayes Owner, Red Carpet Ready Makeup
I applied for federal aid through the Small Business Administration during the first round of funding, but didn't receive anything. I did receive federal aid from the SBA during the second round of funding. I applied to another grant program that is helping small businesses, but am still waiting to hear if I qualify for an award.
It has been a huge challenge applying for unemployment benefits in my state. This is the first time independent contractors were allowed to file for unemployment benefits, and the number of people applying overwhelmed the system. I was able to finally complete the application after waiting 12 hours just to access the system. I haven’t received any unemployment benefits to date.
- Julie Kandalec Celebrity Manicurist and Educator, Julie Kandalec
I decided not to apply for PPP because I don’t trust how the regulations are constantly changing. I think that they don’t even know what’s going on with it. To me, it will only cause me more confusion and stress as the time comes to have to pay it back.
If you have a question you’d like Beauty Independent to ask beauty entrepreneurs, please send it to editor@beautyindependent.com.
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