Axios receives $5M in PPP funding
SBA loan will help high-profile media company avoid layoffs and pay cuts, says CEO Jim VandeHei.
Arlington-based digital media company Axios Media Inc. announced Wednesday it received nearly $5 million in funding from the Small Business Administration’s (SBA) Paycheck Protection Program (PPP), the $349 federal relief fund that ran out of funding on April 16 after 13 days due to overwhelming demand from small businesses hurt by the COVID-19 crisis.
“This loan ensures we can avoid layoffs and pay cuts for our almost 200-person staff for the rest of the year, regardless of how much the overall economy deteriorates,” Jim VandeHei, the co-founder and CEO of Axios, said in a statement on Wednesday. The former co-founder and CEO of Politico, Vandehei was listed among Virginia Business magazine’s 50 most influential Virginia business leaders for 2020.
Before the PPP fund ran out, Virginia banks processed more than 40,000 applications totaling nearly $9 billion, according to the Virginia Bankers Association. Small businesses that received the forgivable loans can use the funds toward payroll costs, mortgage interest, rent and/or utilities payments. But many applications didn’t gain SBA approval before funding ran out.
There has been a debate whether companies like Axios, which was founded in 2016, should be eligible for the PPP funding since it has access to venture capital financing.
”We have taken a financial hit like other small businesses,” VandeHei responded. “Our physical event business is gone until the crisis subsides, and some ad buyers are pulling back to measure the economic fallout.”
Since its inception, Axios has raised $30 million in venture capital from entities including Lerer Hippeau, Greycroft, e.ventures, NBC News and Atlantic Media. Axios attracts 7 to 10 million unique visitors per month generated $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. It also has a documentary series on HBO.
The Senate passed a bill Tuesday that would provide an additional $310 billion in funding, according to the SBA, but it still needs to be passed by the House of Representatives and signed by the President before any additional funding can be made.