What is the impact of #Covid on small businesses?

Negative, obviously, but perhaps more importantly, very unequal. Two recent papers offer contrasting data on small firms.

VC-backed (hence probably tech and often digital) are doing well.

Regular SMEs are struggling.

Gompers, Kaplan et al. find find only small negative effects on VC investments. VCs report that 52% of their portfolio companies are *positively* affected or unaffected by the pandemic and only 10% are severely negatively affected.

https://www.nber.org/papers/w27824.pdf

Kuchler, @stroebel_econ et al., on the other hand, using a large survey among business users of Facebook, find that 61% of businesses experienced a negative shock and lost, on average, over half their business.

https://www.nber.org/papers/w27833.pdf

These contrasting findings suggest that COVID will create a large gap between businesses that can rely on (and leverage) the digital economy and the ones that cannot, as well as a gap between those with or without child care.

Kuchler, @stroebel_econ et al. find that "the biggest challenge for 38.9% of businesses was accessing capital" and that "many business owners and managers were feeling burnt out from taking care of both their business and their household."

A cool feature of Kuchler, @stroebel_econ et al. is that they managed to survey a large number of businesses that had ceased operations during the survey period of late April 2020.