Not long ago, Rover’s belt was very short.
In March 2020, as the reality of the pandemic became clear, the closure of global travel and face-to-face work greatly reduced the demand for the Seattle-based company’s market, which combines pet owners with the ability to receive, walk or care for pet owners. Connect with their people. When pets are in the office or traveling.
In the face of unprecedented uncertainty, Rover made what CEO Aaron Easterly called a “sorrowful” decision to lay off approximately 41% of its workforce, or nearly 200 people. Part of an extensive layoff plan.
Like many other companies, Rover also applied for a Payroll Protection Program (PPP) loan from the Small Business Administration (SBA) and received a loan for $8.1 million in April 2020.
In addition to low interest rates, a major advantage of these loans is that they are forgivable if companies spend money in accordance with SBA’s guidelines. Across the country, Approximately 80% of PPP loans have been exempted in whole or in part, According to the latest data.
Rover chose a different path.company Disclosure in regulatory filings on Thursday afternoon It recently paid off the PPP loan, plus interest and expenses, and returned a total of US$8.2 million.
This move reflects the changes that have taken place in the past 18 months. on the one hand, Pet adoption rate rises and Increase in pet consumption Promoted Rover’s business.
But more importantly, Rover became the latest listed company in the Seattle area through a merger with a publicly traded special purpose acquisition company (SPAC) this week, raising $240 million in net income.
Rover spokesperson Dave Rosenbaum said via email in response to GeekWire’s inquiries: “As a company closely related to the travel industry, we can use these resources to help maintain business during the peak of the pandemic.” “Now our business has normalized. , We have repaid the loan.”
After layoffs last year and dropped to 275, Rover has restored 320 employees worldwide.
Last year, PPP loans provided to listed companies became the subject of controversy.
The SBA’s guidelines discourage participation by companies that “have access to other sources of liquidity sufficient to support their continued operations” and stated that “a listed company with a substantial market value and access to the capital market” is unlikely to be able to truthfully promise that it needs money to survive .
However, there is a gray area for companies that go public, are acquired, or raise large sums of capital after obtaining PPP loans.
Porch Group, headquartered in Seattle, received a PPP loan of US$8.1 million in April 2020. Porch went public through its own SPAC merger in December, raising $322 million in the process.
According to reports, in the same month of listing, Porch submitted an application for loan exemption. Its latest quarterly documents filed with the U.S. Securities and Exchange Commission.
However, the Porch document dated May 19 warns that there is “no guarantee” that it will be able to obtain forgiveness for PPP loans. Due to the quiet period before the company’s August 16 earnings report, Porch CEO Matt Ehrlichman declined to comment this week.
A long-term public company headquartered in Seattle-based RealNetworks, Said in this week’s quarterly report It received a complete exemption of a PPP loan of US$2.9 million in June. The company was able to use PPP funds to bring back some workers on leave.
“We follow the rules very strictly,” RealNetworks CEO Rob Glaser told GeekWire last year. “We have considered this very carefully, and we think this is a meaningful plan for us.”
Like Rover, some companies whose circumstances have changed choose to repay their PPP loans.
Bardy Diagnostics, a Seattle-based medical device manufacturer, received a PPP loan of US$2.6 million. The company said it will repay the loan and interest in full at the end of Friday, together with Hillrom’s US$375 million acquisition. Legal disputes between companies on acquisitions.
Amperity, a marketing technology start-up based in Seattle, has just raised an additional US$100 million in investment, valuing the company at more than US$1 billion, and repaid a US$3.8 million PPP loan in full last year.
Editor’s note: GeekWire applied for and received two PPP loans, each of US$262,800, and has received a full waiver of one of the loans.