Gusto COO Lexi Reese on the push to forgive small business loans amid pandemic

In this episode of Facing Forward, Margaret Brennan talks with Lexi Reese to talk about the state of small business in America during the COVID-19 pandemic. Reese is the chief operating officer of Gusto, a platform used by more than 100,000 small businesses to facilitate their payroll, benefits and HR needs.

Highlights

• On whether federal aid has helped small businesses: “Congress intended the PPP to accomplish two goals: help small businesses cover their near-term operating expenses, which we knew were going through the roof, and two provide an incentive for employers to retain their employees and keep them on payroll. The intent was right. The impact has not been felt well… Tons of businesses, nearly one in four business owners who have not applied for loans in round two, is because they haven’t had their first loans forgiven.”
• Minority owned businesses disadvantaged by federal program: “75% of Black-owned businesses have not had their loan forgiven. That’s compared to 56% of white business owners. Ninety-six percent of Black-owned businesses are sole proprietors or businesses owned and operated by one person. And sole proprietorships struggle to get access to PPP funding again because the documentation requirements are particularly onerous on these businesses. But it’s not because they don’t need them. So the fix is SBA can prioritize minority-owned businesses and make sure that the access is commensurate with the representation that these businesses have in the American workforce.”
• On women forced to leave the workforce during the pandemic: “Women in the labor force is at a 33 year low… women have made incredible gains in the economy over the past decade and they are employing other women, but they’ve been making gains in industries that are the hardest hit by this pandemic, especially those that rely on face-to-face interactions, salons, spas, education, retail… women dropping out of the workforce or closing their businesses to be able to take care of their kids who can’t go to school… this doubles the trouble for women-owned businesses.”

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“Facing Forward”: Gusto’s Lexi Reese transcript

Producers: Richard Escobedo, Anne Hsu, Kelsey Micklas

MARGARET BRENNAN: Lexi Reese, it’s great to have you on the podcast.

CHIEF OPERATING OFFICER OF GUSTO LEXI REESE: Thanks, MARGARET. Happy to be here.

MARGARET BRENNAN: So I think one of the most interesting things about you is- is what you did before your current job. When I was reading your bio, I was impressed to learn you started out in filmmaking. Then you became an activist. Then you went to business school, and now you’re the chief operating officer of a company that, you know, helps other small businesses get their employees paychecks and the taxes paid and all that. How did you go through that arc of different careers?

REESE: Thanks for asking. I, you know, Gusto where I am today that helps small businesses pay, provide health insurance and financial benefits to their employees, is- is kind of the culmination of all these chapters.I have been- I’ve spent my life in pursuit of how do you give opportunities and access to capital, to small business owners and the people that rely on them. And the community impact and the economic impact in nations, when you do this well cannot be understated. And those impacts benefit women across all groups and women of color in particular, because for many people, these are the- this is…