Sweetgreen Returns $10 Million PPP Loan, But It May Not Get Redistributed

“We learned that the money had run out and so many small businesses and friends in the industry who needed it most did not receive any funds,” said Sweetgreen cofounders Jonathan Neman, Nicolas Jammet and Nathaniel Ru in a Medium post.  “Knowing that, we quickly made the decision to return the loan.”

Sweetgreen is a fast-casual salad chain that has 100-plus outposts around the world, a $1.6 billion valuation and $350 million of venture funding.

The $349 billion stimulus was depleted on April 16, having reached larger corporations like Ruth’s Chris Steakhouse, but left many small businesses without the federal loan they need to pay rent, employees and mortgages. 

Shake Shack announced it was returning its $10 million PPP loan on Monday for the same reason; Kura Sushi followed suit on Wednesday, announcing it would return a $6 million loan.

However, it seems Sweetgreen’s returned loan may not actually be redistributed to smaller businesses: “The money will go back in the fund. However, new loans can’t be made against those funds until Congress authorizes new funds,” Jennifer Kelly, a spokesperson for the Small Business Administration told Forbes about Shake Shack’s similarly returned $10 million PPP loan. 

The cofounders defended their decision to apply for the PPP, saying “Sweetgreen’s revenue has been dramatically affected during this unprecedented time…100% of the loan was going to be used to pay the people in our restaurants and hire back furloughed team members faster.

A representative for Sweetgreen told Forbes the Medium post contains all relevant information at this time.