Seattle co-working business lost half of its revenue almost overnight
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Audrey Hoyt’s small business was taking off last year, and she was feeling optimistic that she had finally created something sustainable. But once the pandemic hit and slashed her revenue in half, Hoyt said she started dipping into her savings to keep her doors open.
Hoyt owns The Pioneer Collective, which operates co-working spaces in Seattle and Tacoma, Washington. Hoyt left the financial industry five years ago to start the business, and she has just two employees. Hoyt said February 2020 was the company’s best month to date, but things changed almost immediately once state-mandated closures went into place to prevent the spread of the COVID-19 pandemic.
“Almost overnight, we essentially almost had to shut our business down,” Hoyt said.
Despite the setbacks of limited gatherings and the increase in people working from home, Hoyt said she’s hopeful people will come back and that the company will rebound.
“Marketplace” host Kai Ryssdal spoke to Hoyt about running a microbusiness — a business with nine or fewer employees — during the pandemic. The following is an edited transcript of their conversation.
Kai Ryssdal: Let me ask you the very first question I always ask business people when I get them on the phone: How is business?
Audrey Hoyt: Well, I will say at this particular moment, it feels pretty good. 2020 was obviously a whirlwind of a year. But I would say just in the last couple of weeks, we’re feeling a little bit more optimistic in general, and hoping that we can make it through to the other side.
Ryssdal: That’s great, as are we all, but before we get to the other side, let me take you back to last February, March, when all of this started happening. I mean, Seattle was hit really early. If we can all remember back then, the virus spiked and it went south in Seattle in a hurry. What happened to you?
Hoyt: Yeah, so we were about five years into our business in February of 2020. And February of 2020 was our best month to date. We had been growing year over year. my husband and I are the sole owners of our business. So you know, we felt like OK, we finally, you know, made it, we have a sustainable business. And, you know, we started hearing whispers of what was happening with COVID. And almost overnight, we essentially almost had to shut our business down. So I happened to be pregnant at the time with our third child, and he was born on March 15. And I would say that dates was pretty much that overnight moment. Gov. [Jay] Inslee, we’re in Washington state, had mandated that to shut down of restaurants and bars and limited gatherings. And, you know, our revenue was kind of cut in half overnight.
Ryssdal: I can’t imagine a newborn in all of this.
Hoyt: It kept it exciting.
Ryssdal: Yeah, sure did. So, one of the things we’re doing in this series is sort of looking beyond small businesses down to the microbusiness level, which you and your husband are running with just a couple of employees. Do you feel like you are a factor in the conversations that are happening about saving businesses in this economy?
Hoyt: You know, I do, and we have been really grateful to receive both rounds of [Paycheck Protection Program loans] and some rent relief. So you know, we are being heard, but everyone else, you know, has a real leg up getting out of this. I worry that all microbusinesses are going to have a really challenging time getting out of this. I think it was almost untenable to run a microbusiness prior to the pandemic. And all of a sudden, you’re trying to figure out grant programs and PPP funding. You just don’t have enough manpower to even operate your business anymore, let alone keep up paying taxes and making sure you’re doing everything correctly when you’ve lost, you know, two-thirds of your customers.
Ryssdal: Yeah. So now we’re getting out of this thing. What are you looking at to know that — because I imagine there are still a zillion things keeping you up at night, besides the almost now 1-year-old child — but what are you looking at to know that it’s going to be OK?
Hoyt: Yeah, well, I would say I’m really reassured seeing that people are realizing they really missed the serendipity and spontaneity of human interaction again, and I know many people have enjoyed the work from home. But my husband [Chris] and I have been working together for a long time, and the way we work successfully is knowing that we’re never in the same place at once. And I think a lot of people are recognizing that. And before the pandemic, you know, we did $37,000 in February alone in meeting room rentals. That was a huge, growing part of our business, and I really believe that people want that more than ever when it is safe.
COVID-19 Economy FAQs
What do I need to know about tax season this year?
Glad you asked! We have a whole separate FAQ section on that. Some quick hits: The deadline has been extended from April 15 to May 17 for individuals. Also, millions of people received unemployment benefits in 2020 — up to $10,200 of which will now be tax-free for those with an adjusted gross income of less than $150,000. And, for those who filed before the American Rescue Plan passed, simply put, you do not need to file an amended return at the moment. Find answers to the rest of your questions here.
How long will it be until the economy is back to normal?
It feels like things are getting better, more and more people getting vaccinated, more businesses opening, but we’re not entirely out of the woods. To illustrate: two recent pieces of news from the Centers for Disease Control. Item 1: The CDC is extending its tenant eviction moratorium to June 30. Item 2: The cruise industry didn’t get what it wanted — restrictions on sailing from U.S. ports will stay in place until November. Very different issues with different stakes, but both point to the fact that the CDC thinks we still have a ways to go before the pandemic is over, according to Dr. Philip Landrigan, who used to work at the CDC and now teaches at Boston College.
How are those COVID relief payments affecting consumers?
Payments started going out within days of President Joe Biden signing the American Rescue Plan, and that’s been a big shot in the arm for consumers, said John Leer at Morning Consult, which polls Americans every day. “Consumer confidence is really on a tear. They are growing more confident at a faster rate than they have following the prior two stimulus packages.” Leer said this time around the checks are bigger and they’re getting out faster. Now, rising confidence is likely to spark more consumer spending. But Lisa Rowan at Forbes Advisor said it’s not clear how much or how fast.
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