Practical Strategies For Venture And Private Equity Backed Businesses Considering PPP Loans

By: Jonathan D. Gworek and Matthew L. Mitchell

With the issuance of the U.S. Treasury Departments “Interim Final Rules” and related Guideline within the Paycheck Protection Program’s (“PPP”) “Affiliation rules”, there have been concerns that the Affiliation Rules may deem the portfolio companies of venture capital and private equity firms as affiliates of the fund and of each other. This would preclude many VC and PE portfolio companies from meeting the eligibility requirements necessary to receive PPP loans. With that said, there are strategies these companies may use to navigate the Affiliation Rules which Jonathan Gworek and Matthew Mitchell have outlined in our recent Alert.