I’m A Small Business Owner And Applying For Covid-19 Government Loans Has Been A Nightmare

Sean Penchoff
April 16, 2020

On March 16, my business partner and I reluctantly agreed to shut down our personal training studio in New York City, Nicely Fit Co due to COVID-19. The night before, we had sent out an email to our clients letting them know we would be open, but that we would be doing intensive cleaning and putting in place special protocols to enforce social distancing. We thought we could pull it off. After all, our business is by appointment only, and we have no more than four clients in our gym at any given time. Unfortunately, the news progressed in such a way that we decided it was in the best interest of our clients and our community to immediately shut down in-person operations.

The next day, New York ordered all businesses like ours closed anyway. We had hosted our grand opening party just two weeks earlier. Around that same time I was touring a space that could have been a potential second location. That all feels like ages ago now.

Like so many other small business owners, our gym has been an absolute headache, a source of deep anxiety, and a true labor of love.

Like so many other small business owners, our gym has been an absolute headache, a source of deep anxiety, and a true labor of love. My business partner and I got our keys in November of 2019, and have been running pedal-to-the-metal since then: building the space out, fine tuning our product, building a client base, and learning how to work together like a well oiled machine. We’ve struggled, we’ve fought, we’ve made friends with local businesses, we’ve gotten to know our community, we’ve gotten lucky at many moments, and we’ve worked our asses off. Our hearts break for our friends and neighbors whose businesses are struggling.

We count ourselves lucky; our business model can be transitioned so that we can operate online remotely. Others are not so lucky. In a newsletter to clients that we sent out on March 26th, I outlined the assumptions we are working off of while we sort through the economic mess we’re all in. One of my main assumptions is that we can’t rely on government help. Sure, there are programs, but let’s face it, they are confusing, poorly executed, and not nearly enough. I can say that from experience.

I applied for the SBA Economic Injury Disaster Loan on March 30, and on April 3rd when it launched, I attempted to apply for a loan under the Paycheck Protection Program. The SBA Economic Injury Disaster Loan was easy enough to apply for. Actually, it was suspiciously easy, you simply input some basic information about your business and voila, you’ve applied! There was even a box you can check to have $10,000 advanced directly to your business checking account. To the best of my knowledge, there is no way to check on the status of your application. So, there’s that. Basically, I have no idea if I’ll be getting anything from that program. We will see. 

Next, we have the PPP program. I spoke with my accountant, and he recommended that I speak with my business banking representative at Chase, and that I apply as early as possible given the limited amount of funding and the huge amount of interest amongst small businesses. Unfortunately, I think everyone was trying to reach their business banking representative, so it took a few days to get hold of him.

The week the program was launched, none of the major banks were even set up to process the loans. The application form was available as a PDF so I downloaded and filled it out. I attempted to apply through Chase, but it took until the following week, at which time I could only input some basic contact information. When I completed this, I was told “someone would reach out.” OK.

Then the fun started. My payroll processor, ADP, over the course of the next three days, sent multiple emails letting me know that the calculations the government was using to determine the amount of money you could borrow kept changing. So the supporting documentation that ADP needed to provide had to be revised and re-downloaded. Then, when I got hold of my business banking rep, he sent me a new application form. Apparently the old one was incorrect. Then I received an email from Chase directing me to their website to complete my application. That didn’t work for two days. I was finally able to get everything submitted April 8.

That has meant that based on the calculation the government is using, we’re entitled to a loan that can effectively cover one month of our rent. Fabulous!

The real kicker is that, being a new business, our payroll has been kept super low. My business partner and I have been living off of savings and bootstrapping the business, like so many others out there. That has meant that based on the calculation the government is using, we’re entitled to a loan that can effectively cover one month of our rent. Fabulous!

So yeah, we’re on our own. But don’t let that get you too down. Here’s my advice: Give yourself a moment to process what’s going on, but then start reaching out. The one thing we’ve realized is that there are so many ways to get creative. There are so many opportunities to get in front of your clients and remain relevant. We’re running video-based classes, creating remote workout plans tailored to folks stuck at home with little to no equipment, and looking at every possible angle. Shamelessly plug your business. Shamelessly plug your neighbor’s business. Shamelessly plug your barber. We have. If the government can’t get their act together to help small businesses like ours, it’s imperative that we lift one another up.

Sean Penchoff is the Co-Founder of the New York City-based Nicely Fit Co. Follow him on Instagram at @nicelyfitco.com.

Feature Image: Twenty20