- Data finds that older businesses achieved PPP funding quicker than newer businesses
- Approximately 60% of PPP applications were funded from April 3rd through May 16th
- Denial rate seems to hover around 8% of all PPP applications
In the great race to achieve much-needed funding under the popular Paycheck Protection Program (PPP), have you ever wondered who was having more success getting funded? Additionally, what was the reason for that success? In an article released on May 28th, Lev Borodovsky (WSJ) took the government released data from the PPP and broke it down into different categories to detect any patterns as it relates to who was being funded and who was not. Here is what he found:
- Business Age: Overwhelmingly, businesses that have been in existence longer have had more success in securing PPP funding as well as a lower chance of being denied by the SBA. Businesses in existence for more than 15 years had approximately 65% of the PPP requests funded and only about 5% denied to date. For comparison, businesses in existence for less than one year have had 45% of their PPP requests funded, and approximately 25% of their requests denied to date.
- Business Owner Demographic: There did not appear to be a statistically significant difference in funding success or denials when categorized by the demographic of the business owner. Across the five categories used (veteran-owned, minority-owned, women owner, minority women-owned, none of the above), funding success rates tended to hover between 50-60% while denials oscillated between 8-10%.
- Weekly Trend of Funding: Beginning at the PPP’s inception on April 3rd, there is an obvious exponential trend upwards in funding success rates before beginning to level off in the week of March 16th. Interestingly enough, denial rates appeared to stall out at approximately 8% beginning in the week of April 25th, indicating that business owners and the SBA might have hit their stride inefficiently filing and reviewing applications during that week.
As the PPP is set to adjust its original terms and continue to distribute funding to businesses in need, it will be interesting if the above data trends extrapolate out over the next few weeks.
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Chief Business Officer, Disaster Relief Consultant
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