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Axios announced Tuesday it is returning a loan it received through the Paycheck Protection Program (PPP) as it nears an alternative source of funding.

The media outlet noted in a post by CEO Jim VandeHei that it has come under criticism for accepting funds under the PPP and said it was conducting its search for additional capital as the funds came in.

“Axios, which qualified for a federal Paycheck Protection Program loan to avoid layoffs, will return the money, after nearing a deal for an alternative source of capital,” VandeHei wrote. “In the four weeks since Axios applied for the loan, based on big coronavirus business losses, there has been a public backlash against a variety of companies for taking the PPP, including us.”

VandeHei said Axios had taken a financial hit during the coronavirus pandemic, pointing to physical events that were scrapped and cancellations by advertisers. 

“The intent of the program was to provide funding to businesses that are smaller than 500 employees (we have 190) and would have to eliminate jobs without it, and could not get capital at reasonable cost elsewhere,” VandeHei wrote. 

The Axios CEO added that if the company had known it would have received outside funding, it “would have gutted it out and hoped for the best.” 

“This will hopefully free up $4.8 million in loans for other small businesses still struggling to find capital,” VandeHei said of the decision to return the funds. 

Funds from the PPP have come under scrutiny after wealthy organizations like Shake Shack and the Los Angeles Lakers received money under the plan and were then pressured to hand it back to the government.

The PPP was established under the $2.2 trillion coronavirus relief package that was signed into law earlier this month. Ahead of a new round of PPP funding, the Small Business Administration issued guidance intended to discourage larger companies with access to liquidity from seeking loans under it.

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