When we heard about the bipartisan Paycheck Protection Program, which aims to support small businesses and their employees during the pandemic, we immediately realized that we met the Small Business Administration criteria for our industry category. We applied and were approved for a $6.6 million loan that would help us keep all our employees on payroll. We were elated and relieved.
Then, to use a sailing term, we encountered a strong head wind we had not expected. Media and elected leaders began to criticize certain publicly traded companies for accepting the funds — and we were on that list.
While Lindblad is not a mom-and-pop concern, in the context of American public businesses, it is small, with a current market capitalization — the total value of all our shares of stock — of about $300 million. I recognize that seems big to some, but that scale means we have hundreds of jobs to protect, and we clearly met the criteria as laid out in the law. Almost immediately, we were grouped in the media and political discussion with billion-dollar-plus market cap companies with ample access to capital and thousands of employees. This led to concerns from many of our core loyal guests who could not reconcile their view of us as a responsible, and environmentally and culturally respectful, company with the idea of us taking funds from this program.
We now find ourselves in the unenviable position of being approved for a loan that is no longer tenable for us to accept. We have decided to return the loan. Our hope is that the money can be redistributed to the large number of small businesses, especially those in the travel industry — travel agencies, tour operators, app developers, reviewers, local artisans and our extensive supplier network — that most need the assistance to stay in business.
At this moment, we are not able to qualify for other government loans, and access to capital for a company our size is challenging and costly. So to protect the enterprise given the current state of the business, we have to lay off or furlough employees.
This could not have been the intention of Congress, and our company is almost certainly not alone.
As this crisis unfolds, we urge Congress and the administration to look for ways to help companies such as ours — each one of which employs hundreds of skilled American workers — to gain access to the affordable capital needed to survive.
Returning the money was the right thing to do, given the environment. But it has put our company in a terrible bind.
The travel industry is among the first to take a hit in a financial crisis and among the last to return to good health. We need the help of innovative government solutions or some source of capital to allow us to keep our employees on the payroll as we plan for how we return to doing what we love — taking retirees, families, young couples and adventure travelers to some of the most incredible places on our planet.
We hope new action is coming soon from the government to help companies such as ours that fall between the cracks of current relief efforts.