Category Archives: Current in Entrepreneurship

Slope of the Curve, by Working Nation

Those who read this blog regularly know Clint Day has preached the danger of the “Perfect Storm” shown  below. No one has better depicted the impact of the Perfect Storm on the U. S. workforce than the video by Working Nation also shown below.  The most prominent solution is teaching, facilitating, and helping spread the skill of…entrepreneurship.  Thanks to the internet and Silicon Valley’s invention of its lean startup entrepreneurship it  can be taught and, more importantly, learned by anyone with desire.  The reason is evidenced-based planning where an end-user, the persona with a problem or a need, helps design the product through Steve Blank’s customer development process. Now displaced truck drivers, for example, can use a hobby, interest or past work experience to start their own small, successful business.

Start with learning an entrepreneurial mindset by reading Kyle Garman’s book The Entrepreneurial Mindset and watch  Next choose an idea you are passionate about that fills a need.  Try to have an emotional investment in the concept and read this article /howtofindyourpassion.html. Finally, learn lean startup from and video as you find a mentor at a college entrepreneurship program, an incubator or the state SBDC (Small Business Development Center).

The Slope of the Curve (by Working Nation) 

Only Entrepreneurs Will Survive in a World That Only Gets Faster

One of the bright minds in our entrepreneurship field is MIT Sloan Professor of the Practice Bill Aulet. Author of Discipline Entrepreneurship used to build startups globally.  Here is an interview by Robert Thurston last month for the SFMBA Roundtable 5-Star rated.

If the pace, abruptness, and unpredictability of change during the global pandemic has you hoping for a chance to catch your breath, MIT Sloan Professor of the Practice Bill Aulet has a word of caution. “The world never will be slower than it is today,” he says. “That’s a fundamental state of affairs that entrepreneurs must embrace if they are to thrive in the midst of—and most certainly beyond—this current global crisis.”

“The traditional approach to launching an enterprise is based on a command/control/conquer model,” says Aulet. “Gain control of resources and overpower your competitors. Go forth and win. The problem is that this approach only serves to optimize large organizations into doing what they’ve always done—which builds in a perilous fragility that can cripple a company when the marketplace and the world become more fluid and chaotic.”

According to Aulet, many leaders default to a posture of being robust and resilient in the midst of a crisis. “Robustness is a trap, however, because it’s actually a neutral condition,” he warns. “Robust people and teams maintain their course when faced with adversity or unexpected events. In today’s world, weathering storms by continuing to march straight ahead is not a sufficient condition for success.”

Building ventures that don’t break

The Martin Trust Center, by contrast, teaches what it refers to as a resilience-plus approach. “Resilience-plus comprises a mindset, a skillset, and a mode of operation better suited to chaotic, rapidly evolving circumstances,” says Aulet. “We want our students to embrace adversity as an invitation to up their games in the same way that champion athletes or great artists transform setbacks into greater creativity and higher levels of performance. That’s the resilience-plus mindset.”

Aulet summarizes the skillset in six points.
• Understand how technology trends are changing and look ahead to what’s next.
• Track changing consumer behavior patterns and the evolution of cultural norms.
• Build an organizational strategy that capitalizes on your understanding of what lies in the future.
• Be prepared to step on the gas when you see a new opportunity emerging in the marketplace.
• Continually iterate to create a spiral of innovation that refines your response to new opportunities.
• Run data-driven experiments to test and perfect your operating assumptions about future trends.

“Companies that excel in these areas—Zoom, Peloton, Netflix, Grubhub, for example—have thrived during the pandemic,” notes Aulet. “They each invested heavily in their assumptions about changing consumer behavior before COVID. When the crisis presented a window of opportunity, each company accelerated and evolved their offerings to meet the moment.”

A Marshall Plan for entrepreneurship in the U.S.

Going forward, Aulet sees an even greater need for MIT-style entrepreneurship across the country. “Forget any notion of restoring what existed pre-pandemic,” he advises. “We will have more health crises, additional civil unrest, greater climate-driven challenges, additional economic disruption. To succeed under those circumstances, companies must resist the natural temptation to hunker down and focus just on what they themselves do well. For the resilience-plus entrepreneur, the flipside of less control is greater opportunity to collaborate.”

Aulet believes a community approach will drive the next wave of entrepreneurship in the U.S. “Don’t let a lack of control over resources discourage you from pursuing a new opportunity that you believe is right for your company,” he says. “Instead, tap into the skills and resources that lie within your network but outside your organization. If you can create something of value through collaboration, you can help build an ecosystem in which every party gains something for their investment in a particular project. Be a great collaborator, and you will attract great collaborators.”

Even though the Martin Trust Center approach has gained global recognition, Aulet believes there’s much more work to be done. “If the world is coming around to us,” he says, “then we need to reach further out into the world. Kentucky, Ohio, Idaho, Pennsylvania, you name it. The entrepreneurial spirit is out there, waiting to be tapped in places where people feel alienated and believe they have little control over their destinies. My hope for the future is that young entrepreneurs will not only be inspired to make money but to make more entrepreneurs. If we build more resilience-plus people, we will build a resilience-plus society.”

Calm down: Your work and life may depend on it

Continual, or chronic, stress can cause mood swings, reduced empathy, and impulse-control issues. It’s also associated with an increased risk of cardiovascular disease and stroke.  Stress and anxiety are common experiences for most people. In fact, 70% of adults in the United States say they feel stress or anxiety daily.  How to relieve it:

  1. Exercise. Exercise is one of the most important things you can do to combat stress. …
  2. Consider supplements. Several supplements promote stress and anxiety reduction. …
  3. Light a candle. …
  4. Reduce your caffeine intake. …
  5. Write it down. …
  6. Chew gum. …
  7. Spend time with friends and family. …
  8. Laugh
  9. Exercise
  10. Take a yoga class

Pivots, a Pandemic, and Startup Founders’ Mental Health

The pandemic affects everyone. Today, we are all dealing with a different model for living – many people are working or attending school virtually, there is less social interaction, greater isolation, more juggling of home and work duties, and of course the anxiety and pain if loved ones become sick or die from COVID-19. A study by the CDC in June of this year reported 40% of US adults are struggling with mental health or substance abuse – substantially higher figures than in 2019.

Where does that leave our entrepreneurs? Beginning in March, the Martin Trust Center for MIT Entrepreneurship closed its doors until further notice. We are continuing to support MIT’s entrepreneurship community virtually, including via online resources like Orbit. This past summer, our delta v accelerator moved to a completely virtual experience, including online Demo Day presentations.

One question we continue to ask ourselves is: How has the pandemic affected the mental health of entrepreneurs?

Building Entrepreneurial Confidence

As we look to answer that question, we realize we were fortunate that MIT started the first self-awareness program for entrepreneurs last year – the Entrepreneurial Confidence and Communication (ECC) Program. We piloted this program with the delta v accelerator class of 2019 to help student entrepreneurs prioritize their own individual well-being while building their businesses. The culture of entrepreneurship celebrates working 24/7 to demonstrate passion and dedication for your business. A founder’s self-identity is often tied to the success of their startup, and as a result, entrepreneurs often experience loneliness, depression, and anxiety as they work through the normal ups and downs of startup life. This has only been magnified by the COVID-19 pandemic which has caused delays, roadblocks, and failures for many startups.

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Traditionally, entrepreneurs have lacked the support and tools to improve their mental well-being. The ECC pilot program, created by MIT Sloan MBA alumna Kathleen Stetson, taught MIT student entrepreneurs the tools and benefits of self-awareness; they then applied their learnings – discussing key choices entrepreneurs face, such as: taking breaks vs. spending all your time on your startup, working through limiting beliefs, considering others’ perspectives, and approaching challenges with fear or curiosity. The results were impressive, after taking part in the program 93% of participants felt that a self-awareness practice could help entrepreneurs create more successful businesses.

This year, because of the additional stress due to the pandemic, and the need for teams to feel connected when working remotely, we added two simple elements to the small groups within the ECC program that startup teams could quickly and easily implement in their own team interactions:

·        Red/yellow/green check-in – this not only encouraged small group members to practice self-awareness during small group, but many teams took this check-in strategy back to their teams, practicing it at the beginning of each of their standups.

·        A more structured way to give and receive help – after a small group member expressed a challenge they were facing, small group members asked clarifying questions rather than immediately jumping into solutions and advice. This not only made the speaker feel that they were heard, but helped participants practice active listening. They then took this back to their team interactions, helping them better understand their team members’ perspectives.

In a Fast Company article, Kathleen Stetson explains, “The 24/7, hustle-till-you-drop attitude has been a problematic fixture of startup culture for years. And now, due to the pandemic, sustaining one’s health is even harder. ‘I don’t know a startup founder who’s not burned out,’ a founder friend of mine told me recently.”

The Pivot: A Key Pandemic Strategy

“Pivot” has become the go-to word for 2020. People are pivoting with career changes and businesses are pivoting with strategies, as we all try to keep moving forward dealing with the unanticipated changes brought by a global pandemic. Entrepreneurs need to realize that a startup failure can be due to external circumstances, and the founders are not marked with a scarlet “F” for failure. A change in business strategy or taking a break from trying to start your own company is a pivot that will make you stronger the next time.

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One of our delta v teams faced this type of challenge recently. Easel was a startup service that matched parents with top quality centers for last-minute childcare needs. The company was a member of the delta v class of 2019 and was faced with the tough decision to wind down the business this year. With the COVID-19 pandemic, so many people have transitioned to working from home that their childcare model was no longer sustainable. Although childcare continues to be a huge need, co-founders Neha Sharma and Michael Leonard realized they would need to shelve their plans for Easel and pivot to the next chapter in their lives. However, as delta v’s Managing Director Bill Aulet stated, “I still chalk these up to success for sure. They are much stronger than when they got here.” That strength, in part, came from MIT’s ECC program.

This type of a transition is one that often tests an entrepreneur’s sense of worth and purpose. They have put blood, sweat, and tears into their business only to watch their dreams fade. As stated in the Thrive Global article I co-authored with Kathleen Stetson, startup founders “tend to connect their self-worth and identity to their start-ups, which can lead to feelings of depression if their start-up fails.” Yet, we’ve found data affirming that when entrepreneurs understand their thoughts, feelings, and biases, it is useful in managing stress – and this is a skill that can be taught. This is why MIT is proud to host the Entrepreneurial Confidence and Communication program – the first comprehensive program to address mental health challenges in the start-up community and teach entrepreneurs how to effectively manage stress.

Courtesy of Patricia (Trish) Cotter, Ed.D., iPEC CPC  Executive Director Martin Trust Center for MIT Entrepreneurship published on Linked-In.


Building a Bridge to Normalcy

To America’s leaders, innovators, and change makers: even as the COVID-19 pandemic continues, a return to a normal existence is in sight.  Getting the end game eight could save thousands of lives.

We hope that 2021 will see the United States gain a decisive upper hand in its fight against COVID-19. The country is currently engaged in an unprecedented race to vaccinate as many people as possible while using public-health measures to minimize deaths in the short term. The situation is dire—more people died in the United States from COVID-19 in January 2021 than died in the last two years from the flu.1 Even as we work through the challenges of this ongoing tragedy, we argue that it is reasonable to hope that the first half of 2021 can be a bridge to what we term “normalcy” # when many aspects of social and economic life can resume without fear of excess mortality (when overall mortality exceeds its long-term average). The great news is that vaccines appear effective—seeing “shots go into arms” is heartening. The less great news is that new challenges are emerging by the day, including more contagious strains of the virus and a slow start to vaccine rollout.

Public policy can set the tone, but it only works with the consent of the governed. Containment of COVID-19 is about millions of individual decisions. In the United States, stringent policies about testing, tracing, and mask wearing have correlated only loosely with changes in epidemiology (Exhibit 1).2 This is not because testing, tracing, and mask wearing don’t help, but because public consent has been limited.3 Citizens’ behaviors are based on public sentiment; people modulate their actions in line with those around them.

Make no mistake: COVID-19 is first and foremost an infectious disease. The death toll in the United States is now over 460,000,11 and broader effects on health are substantial (Exhibit 4). But many of the interventions we are using to prevent the direct impact of COVID-19 have caused substantial secondary harm, including unemployment,12 learning loss, and increases in substance-use disorders.13 The bridge to normalcy needs to be a time when we address not only the underlying issue of SARS-CoV-2 transmission, but also the restoration of our economy and the secondary effects of COVID-19.

Simply returning to the same disease-fighting protocols and infrastructure that we used before the pandemic won’t be adequate. We have the potential to establish a next-generation disease surveillance and testing infrastructure, including wider access to genomic sequencing; 21st-century data management and analysis; and closer integration between health delivery and public-health capabilities.

#Normalcy –

Courtesy McKinsey & Co. by Matt Craven, Tom Latkovic & J. VanLare

Why Business Model Innovation Matters More Than Ever

The coronavirus pandemic has been a roller coaster for business managers. Some are cresting high, others are in freefall, and many more are simply trying to hang on until the nightmare ride comes to a stop. Amid the panic, there are valuable lessons for leaders who can take a deep breath and step back. Wharton management professor Ra Amit and Christoph Zott, an entrepreneurship professor at the University of Navarra’s IESE Business School in Spain, have written a new book to guide businesses through the internal and external shocks caused by the pandemic and other disruptions.

 INNOVATION WhyBusinessModelInnovationMatters MoreThanEver 2/17/2021 Why Business Model Innovation Matters More Than Ever –  Before we dive into the book, could you give me a little background on your collaboration? Ra Amit: We’ve known each other since the mid-1990s, when we met at the University of British Columbia in Vancouver, Canada. Both Chris and I are strategy and entrepreneurship scholars with a very pragmatic orientation and very rich practical experiences. We observed in the mid- and late-1990s that there were all these e-businesses that were formed, and they are enormously valuable. We observed companies like eBay, for example, which was founded in 1995 and went public in 1998. It doesn’t have a product. The cost of goods sold is zero. Yet eBay is worth billions of dollars. Take Netix, another example of a company that was founded in 1997 and went public in 2002. There’s really nothing new about its product. You could have rented CDs at Blockbuster, yet Netix innovated in the way you rent a CD. Initially, it was mail order, and now it’s streaming. By innovating the way you rent a CD, it drove Blockbuster out of business. This allowed Chris and me to realize that there is a new form of innovation that is distinct from product innovation, that is distinct from process innovation, and which does not require mountains of R&D expenses and years of research. This new form of innovation centered on the way companies do business. Namely, their business model. We published over two dozen papers together, and we decided to write a book about business model innovation. Christoph Zott: The real answer is that because our last names t so well together — Amit and Zott. We’re the team that looks at something and tries to nd the answer from A to Z. If you go even beyond the internet and the focus on business models, what brought us together was our keen interest in entrepreneurship and everything that has to do with value creation. Ra and I share a passion for that subject. We really want to understand how value is created, how people create something from nothing. This is this magical formula that is typically attributed to entrepreneurs. They’re able to turn ideas into something tangible. [They build] companies that provide employment to people. They create products that customers want to buy. The relevant issue that we were observing, especially in the second part of the 1990s, was that there were a bunch of companies that were created very fast and made it to IPO really fast. Netscape, Yahoo, eBay. We asked ourselves, “What’s special about these businesses? Is there anything new here?” That led us to the realization that what these companies were doing and were really good at had nothing to do with our preconceived notions of products or services. But it was in how they did business, which we then called the business model.

Christoph Zott “Everything that we have learned in business school for the past decades is stilltrue. Butthe business model offers a new avenue for value creation.” There was something fundamentally new going on, and it didn’t really have to do with the digitization of business. We saw that digitization was an enabler for rms to go about business in a new way, in a dierent way. This got us o on our work on business models and business model innovation. We wrote our rst paper together in 2000, and it was published in the Strategic Management Journal. It’s still considered one of the seminal pieces on business models. It wasn’t that the business model was a brand-new idea for managers. But for academia, it was a new idea. We were interested in developing this idea and exploring it further because we thought it was a very, very rich idea. If you have companies that, within a matter of a few years, become worth billions of dollars, there must be something really to it. We’ve been at it now for a long time, and the book represents a summary of the insights that we and our colleagues have found and researched over the past 20 years. Knowledge@Wharton: Let’s talk about what business model innovation is. In this book, you help dene it by telling us what it is not. You wrote that, “Modifying an activity by making it faster, cheaper, or higher quality is not a business model innovation.” That statement seems to eliminate the traditional avenues of improvement that managers usually take. What should they be doing instead? Zott: I’d like to address this question in two ways. Yes, we do say in our book what a business model is not. And we do this deliberately, because we think it helps people understand better what a business model is in the rst place. In general, there is a lot of confusion about what a business model really is. If one person says A and another person thinks B, it’s very hard to think that they have a real conversation around this topic. So, we thought it would be very important rst to dene the concept clearly. The second thing is that we don’t believe that other ways of creating value have become less important and that the business model eliminates these traditional avenues. In contrast, the business model adds to these traditional avenues of improvement for business managers. It complements them. Everything that we have learned in business school for the past decades is still true. But the business model oers a new avenue for value creation. 2/17/2021 Why Business Model Innovation Matters More Than Ever – Knowledge@Wharton

Professor Amit, what is the framework for business model innovation? Amit: Now we know what the business model is not — it’s not the product, it’s not the rm, it’s not all-encompassing, and it’s not the same thing as a business plan. The way we think about the business model is as a system of interdependent and interconnected activities that are designed to capture market needs, or perceived market needs, and create value for all the stakeholders. It’s a holistic concept that requires the manager to take a step back and apply system-wide or system-level thinking. There are really four dimensions in a business model. First, what are the activities that need to be carried out as part of this business model? Second, how are these activities sequenced or connected to each other? Third, who carries out each of the activities? And fourth, why is this business model creating value for all stakeholders, and why does this business model enable the focal rm that innovates the business model to capture some of this value? The basic idea is, as Chris pointed out, if you just change and make the product a little bit better — you add a feature, for example, or make it work faster — it doesn’t change the system of activities. So, when we talk about business model innovation, it refers to a business model that is new to the industry in which the rm competes. And business model innovation strategy, which is the title of the book, refers to the design of a new activity system, namely, the design of a new business model. It refers to the processes by which that new system of activities is created and the implementation of the system within the context of the rm. And very, very importantly, [it includes] the ongoing adaptation of that business model to a changing ecosystem or environment within which the rm competes. Zott: I just wanted to repeat this very important observation — that a business model is not allencompassing. If it were all-encompassing, how would it then be dierent from a rm or an organization? We’re talking about the business model of a company, of an organization. This is distinct. In terms of the business model, it’s the activity system that we would like to highlight as the crucial underlying conceptual backbone. We could think of Apple, which is a very well-known example because Apple does both. Apple is brilliant with product innovation and design. They have innovated many gadgets that are household items today, which has made them one of the most valuable companies on the planet. The iPhone is one of the latest examples of that. 2/17/2021 Why Business Model Innovation Matters More Than Ever – Knowledge@Wharton

Raphael Amit “When we talk about business model innovation, it refers to a business modelthatis new to the industry in which the rm competes.” But they are also a very powerful business model innovator. With the introduction of their app store and iTunes and all of those innovations, what they have done is added a distribution platform to their hardware business, which makes their hardware business more valuable. They benet from the sale of the gadgets, but they also benet from the sale of the content that is played on these gadgets, so they benet twice. There is a mutually reinforcing relationship here between their product innovation and their business model innovation. Knowledge@Wharton: In the book, you stress the importance of adopting a business model mindset. That usually refers to startups and thinking like an entrepreneur, but it’s a little bit more than that for you. So, what is a business model mindset and why is it important? Zott: You mentioned entrepreneurial mindset. That is one type of mindset that’s certainly very helpful. But when we talk about business model mindset, we refer to what Ra has mentioned a little earlier as system-level thinking and holistic thinking. Entrepreneurs also need to think at the system level and holistically because they need to think about the entire business architecture. They need to think about all business functions. It’s the same thing with the business model [mindset]. In the business model mindset, you need to be able to take a step back, and this sometimes is very dicult for managers because they’re focused. They work in organizations, within certain functions, so they’re good at one thing. They’re good at strategy, they’re good at marketing. They may work in sales, or they may work in nance. But they rarely have this opportunity to take a step back and rethink the entire construction, the entire architecture of the business for which they’re working. How does it all hang together? How are all these activities connected to each other? That is what we believe requires a specic mindset — this ability to see the forest and not just the trees. That’s the rst requirement of a business model mindset. To be able to jump the level of analysis from a focus on activities or individual activities or products, to the system level. Amit: Think about a car manufacturer executive’s reaction to the entry of Tesla into the automotive market. The rst thing they are thinking about is, “Well, maybe what we should do is expand our product portfolio and have an electric car or a hybrid car,” because the focus is on the technology of the product.

Courtesy of Knowledge podcast at Wharton, Feb. 15, 2021 and Professors Raphael Amit and Christoph Zott  who discuss their new book, Business Model Innovation Strategy.


The Entrepreneurial Spirit: Surviving & Thriving

As I bade farewell to the tumultuous days of 2020 and looked forward to better times in 2021, I took time to rejuvenate.  One of my late 2020 adventures took me to the town of Jaffrey Center, New Hampshire where I visited the Old Burying Ground behind the town’s meetinghouse in the shadow of majestic Mt. Monadnock.  Buried here are Amos Fortune (1710-1801) and his third wife Violate (d. 1802). Amos was born in Africa and enslaved in America, eventually purchasing freedom for himself and his wife.  While a slave in Woburn, Massachusetts, he learned the tanning trade, an industry launched in the city in the late 1600s.   Freed in 1770, he moved to Jaffrey in 1781.  In his 70s, he capitalized on his skills and established a successful tannery business, living into his 90s as a respected and prominent citizen in the community.  Amos Fortune exemplified the entrepreneurial spirit.  In Woburn and Jaffrey, he not only survived—he thrived.

I share this inspirational story as a beacon for all to harness this moment and rise above the unsettling experiences and daunting challenges of the pandemic.  The entrepreneurial spirit must be our guide as we figure out how to navigate successfully in a changing world reinventing itself with almost unimaginable velocity.  As old ways of doing things fade, innovations enter our lives influencing how we eat, shop, work, and enjoy life.  While we all wish for more time together without masks and social distancing, I hear friends and family saying that they have experienced epiphanies during this last year that will transform for the better how they approach life and work moving forward.

The entrepreneurial spirit—the drive and skills  that inspire us to make lemonade from lemons—is essential to our sense of purpose, physical well being, and mental health.  Times of rapid societal shifts are fertile ground for opportunity.

Amos Fortune lived many lives, reinventing himself, his family, his livelihood, and his home over a long and meaningful life.  With all the obstacles thrown in his path he was undeterred, finding happiness and prosperity borne of optimism, courage, and unwavering entrepreneurial spirit.  This is the important message I gleaned from my tour of a quiet cemetery—an excursion that happened because the pandemic has changed how we view our goals, experience our days, and interpret life’s lessons to help us survive and thrive in an ever-changing world.

Rhonda Abrams Speaks on New Stimulus for Business.

Let’s face it: the proverbial sh*t’s hit the fan. Yes, the language might be a bit crude, but what else can you say when, in response to a world-wide pandemic, the entire economy comes to a screeching halt? Small business owners and startup entrepreneurs have never been faced with anything like this. But can challenging times lead to successful companies? Yes! And this book can help you―with 99 specific, time-tested, do-it-now tips that will show you how to survive and thrive in any economy―even a recession. America’s leading small business guru is dedicated to helping you thrive, and she shares what she’s learned from decades of experience with successful entrepreneurs―many who’ve faced tough times and come out even better on the other side. They could do it―and so can you. We guarantee you’ll find at least one, but probably dozens, of tips that will help you make more money, run your business more efficiently, and sleep better at night.

New PPP and Small Business Loan Options.

SBA, in consultation with the U.S. Treasury Department, reopened the Paycheck Protection Program (PPP) for First Draw PPP Loans the week of January 11, 2021. SBA began accepting applications for Second Draw PPP Loans on January 13, 2021.SBA is currently accepting Second Draw PPP loan applications from participating lenders. Lender Match can help connect you with a lender. You can also view all lenders near you on a map.

At least $25 billion is being set aside for Second Draw PPP Loans to eligible borrowers with a maximum of 10 employees or for loans of $250,000 or less to eligible borrowers in low or moderate income neighborhoods.

The Paycheck Protection Program (PPP) now allows certain eligible borrowers that previously received a PPP loan to apply for a Second Draw PPP Loan with the same general loan terms as their First Draw PPP Loan.

Second Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

Maximum loan amount and increased assistance for accommodation and food services businesses

For most borrowers, the maximum loan amount of a Second Draw PPP Loan is 2.5x average monthly 2019 or 2020 payroll costs up to $2 million. For borrowers in the Accommodation and Food Services sector (use NAICS 72 to confirm), the maximum loan amount for a Second Draw PPP Loan is 3.5x average monthly 2019 or 2020 payroll costs up to $2 million.

Who may qualify

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
  • Has no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020