Many small businesses in our area were banned from the first round of PPP and are hoping for better luck with this second round now underway.
CHARLOTTE, NC — Stratos Lambos owned Ilios Noche in South Park for eight years but was forced to close after losing the first round of PPP loans.
“It was an incredibly stressful experience. There was no way we could survive,” said Lambos. “We extended it throughout the summer. If we had gotten the help we probably would have stayed, no doubt, but it never happened.”
He hopes for a better outcome with this second round of PPP, as do minority entrepreneurs in our region and across the country. Many of them did not receive funding in the first round.
RELATED: “It’s very frustrating” | Small business Charlotte is turning around several times during the pandemic to stay afloat
John Stanford is the executive director of the Small Business Roundtable. They work with small businesses across the country and helped Congress draft the original PPP legislation and this new second round.
“We were quite concerned that low-income businesses, minority-owned businesses, and businesses owned by women who may not have traditional banking relationships were excluded from a program,” Stanford said.
“In March or April, there was so much confusion that millions of companies walked out of the program,” Stanford said. “It also ran out of money too quickly 340 between this confusion, lack of access and drying up so many people were left out.”
In the first round, 5 million companies raised $500 billion in PPP.
The second round started in January with more than 60,000 companies that applied on the first day.
One of the problems with the first round? Many small businesses work with smaller, community financial institutions that weren’t equipped for the program, now Stanford believes they are.
RELATED: Why the PPP loan forgiveness process is so complicated and how to navigate it
“These are the local groups in the toughest neighborhoods and are there to help entrepreneurs recover,” Stanford said.
Lambos is already working with his accountant to apply for the second round. He needs help with the original Ilios Noche, which has been a Charlotte staple for nearly 20 years.
“To get through this year and not knowing how soon things are going to open up and we all know that’s going to take some time, we need all the support we can get,” Lambos said.
Jose Alvarez is Vice President the non-profit Prosperawhich offers free advice to Latino entrepreneurs.
“You may know how to do business in Latin America, but it’s a different system here,” Alvarez said. “The majority in the Charlotte area and North Carolina are first-generation or Latino entrepreneurs, immigrant entrepreneurs. So they may not speak the language, they may not necessarily know what is available to them, much less during a pandemic.”
The second round of PPP funding, which opened in 2021, earmarks $12 billion specifically for minority-owned companies and prioritizes smaller lenders.
Alvarez said that during the first program, from March 1 to December 31, they were only able to help four Latino-owned businesses in North Carolina obtain a PPP loan. Since the second revised round started last month, they have already helped secure 27 loans.
Alvarez encouraged all small business owners to seek whatever help is available to ensure a strong and diverse economy is still on the other side of this crisis.
RELATED: Business owners hope to capitalize as round two of PPP begins
Matthew Villmer is a managing partner at Weaver, Bennett and Bland is an attorney who works with small businesses and recently hosted a webinar on the second round of the PPP.
We asked him to clarify who qualifies for the second round of the PPP?
- 300 employees or fewer
- Must already have used all money received in the first PPP round.
- “Gross Income” must have decreased by 25% for each quarter in 2020 compared to 2019.
What documents do you need?
Additional local resources for small business help:
Business center for women of Charlotte
District Office of the US Small Business Administration in North Carolina
Savannah Levins contributed to this report.