Axios returns $4.8M in PPP funding
Arlington-based media company is raising private funding to replace it.
Arlington County-based digital media company Axios Media Inc. is returning $4.8 million it received from the Small Business Administration’s Paycheck Protection Program (PPP), according to Axios cofounder and CEO Jim VandeHei, who said the federal relief program aimed at helping small businesses keep their workforces employed had “become much more politically polarized since its inception.”
“While applying for the loan felt like the right and prudent thing to do one month ago to protect our 190 employees, if we knew then what we know now, we would have gutted it out and hoped for the best,” VandeHei wrote in an Axios article.
Axios, which is privately owned, met the loan program’s criteria, VandeHei wrote. With only 190 employees (small businesses with fewer than 500 employees are eligible to apply for PPP funds), Axios saw its events business shut down and much of its advertising revenue has also disappeared due to the pandemic. Axios says it is now close to reaching a deal for private capital to replace the PPP funding.
Since its inception, Axios has raised $30 million in venture capital from entities including Lerer Hippeau, Greycroft, e.ventures, NBC News and Atlantic Media. The Axios website attracts 7 to 10 million unique visitors per month, generating $25 million in 2018 revenue. At the end of 2019, the company was poised to raise an additional $20 million in venture capital, which raises its valuation to $200 million. Axios also has a biweekly show on HBO that VandeHei has described as “a ’60 Minutes’ for the new generation.”
Before the second round of the funding was announced on April 24, large, publicly traded companies such as Shake Shack, Ruth’s Chris Steak House and AutoNation as well as large private enterprises like the Los Angeles Lakers returned tens of millions of dollars in relief funds after they came under fire for applying for PPP funding through smaller subsidiaries in order to receive money that was intended to go to small businesses.
The first round of $349 billion in PPP funding ran out on April 16 after just 13 days, due to overwhelming demand from small businesses hurt by the COVID-19 crisis.