Source: Wisconsin State Journal
After six years in business, Mickey Siedenburg was preparing to expand her Dodgeville massage therapy practice in June, taking on another therapist and hiring her 17-year-old daughter as a receptionist.
But a statewide health emergency response to the COVID-19 coronavirus pandemic put everything on hold in mid-March.
“I was busy,” she said. “Then boom — we’re not working.”
Siedenburg applied for federal assistance, which she describes as jumping through “hoops of fire,” but her credit union didn’t participate in the Paycheck Protection Program, part of a $2 trillion emergency relief package approved last month.
“The PPP was a joke,” she said. “I got completely shut out of that.”
Siedenburg eventually got $1,000 through another federal program, but her initial unemployment claim was denied because she was self-employed. While eligible for federal pandemic unemployment, Siedenberg said she doesn’t know when she might see any of that money.
Instead, she turned to Kiva, a crowdfunded lending platform that allows entrepreneurs to raise money through small individual contributions, for a $5,000 loan.
“I didn’t have a lot of confidence in the system,” she said.
With the first round of federal emergency small-business funds exhausted and much of the $349 billion gobbled up by bigger companies, owners of mom-and-pop businesses like Siedenburg’s have turned to local grants and loans in an effort to survive the pandemic shutdowns.
More than 44% of the money went to companies with payrolls of more than $4.8 million, according to data from the SBA. The average loan was about $206,000, which translates to an annual payroll of nearly $1 million.
Rob Scott, SBA Great Lakes regional administrator, said Friday that while Congress dropped many of the “guardrails” in the first aid package, rules have been changed to keep money from going to larger organizations such as Ruth’s Chris Steakhouse, Shake Shack and some private universities that were approved in the first round.
Dane Buy Local, which is administering the grants, received more than 2,000 applications detailing more than $27 million in needs.
The first round of grants, totaling $450,000, was awarded Wednesday to 301 locally owned businesses, for an average grant of just under $1,500. Applications are still being accepted for the remaining funds.
“It’s a Band-Aid,” Murray said. “And we know that.”
While payroll protection funding will help pay her 14 employees this month, Rose Molz, president and co-owner of EZ Office Products, said she will use her $1,500 county grant to purchase nitrile gloves and hand sanitizer, the main products her company is selling right now.
Others, like Siedenburg, have turned to alternative sources, like Kiva.
Michelle Sherbinow, Kiva’s capital access manager for greater Madison, said she’s handled dozens of applications in recent weeks for loans of up to $15,000.
Towns & Associates, a Baraboo-based company that publishes four local magazines, as well as business directories for hotels, raised $15,000 in just 48 hours.
Johnson, who laid off three of her 11 employees and reduced the rest to half-time work, said she expected to receive federal funds, which she will use to pay the staff. She said the Kiva loan will allow her to pay her printers and other vendors so that she can continue publishing.
Siedenburg, who went to school and launched her own business as a single mother of three, had used Kiva to lend money to others, including a woman trying to sell ice cream in the Philippines. In each case, Siedenburg said she got her $25 back.
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