Happy Saturday, and my early-ish thoughts on PPP for startups:
1/As most have seen, the newly released SBA guidance https://www.sba.gov/sites/default/files/2020-04/Affiliation%20rules%20overview%20%28for%20public%29.pdf wasn't exactly what ppl were looking for and some ambiguity around certain points.

2/The good news is that it *appears* ( @trevorloy chime in pls) that some of the negative covenants will be taken on an individual VC level to trip affiliation (instead of collectively). In other words, to trip, the VC itself must be able to do things like prevent a quorum

3/ It's still confusing given the complexity of share classes. Most startups in the US will qualify given they don't have VC backing and voting and ownership generally controlled by founders who do know have control affiliations w/other startups.

4/ Also, it's possible to trip affiliation because of VC backing, but not breach 500 rule; particularly if a new firm that is the sole affiliate who is early in investing as a firm and/or has invested in companies whereby total control positions are in comp that in agg are <500

5/Many VCs are saying "go apply" regardless! Please take the rules seriously and speak to legal counsel for their blessing as civil/crim penalties possible. We don't yet know how banks will figure out processing on this & some will defer until clarity on this is given

6/Also fear of money running out within a day is a bit overblown. System is completely overloaded and most banks doing existing clients only. If $ runs out quickly govt will be pressured to release another tranche. Economy is #1 thing for this admin. Have proven this extensively