Despite Millions in the Bank and on the Balance Sheet, Jukin Media Took $2.2M in PPP
The pandemic has put Hollywood productions out of commission, but at least one entertainment company — L.A.-based Jukin Media Inc. — seemed to be hitting its groove by finding a new niche in entertaining quarantine videos.
Yet despite millions in the bank and on the balance sheet, Jukin also took $2.2 million in Paycheck Protection Program (PPP) funds, according to data released by the U.S. Small Business Administration and confirmed by the company.
Jukin Media said in a statement to dot.LA that the company "applied and received $2.2 million" to "cover its payroll costs and help avoid layoffs." It also noted that a substantial portion of its revenue is advertising based and that Jukin has seen a "significant dip" in advertising revenue because of the pandemic despite "modest gains" on the licensing side of the business.
"As a mid-sized, independent business, we have saved jobs in large part because we secured this assistance," the statement said.
PPP money was ostensibly allocated to keep small businesses impacted by the novel coronavirus afloat during the pandemic. Businesses are required to attest that they have been negatively impacted by the COVID-19 pandemic.
Jukin Media is all about user-generated content. A large part of its business is licensing videos and providing it in its library — now with some 65,000 videos — to major companies, brands and media companies.
The company also boasts 200 million fans and 2.5 billion monthly views. It has paid out $25 million to video owners — through revenue shares or up-front payments — over the last five years, Skogmo recently told dot.LA. It also syndicates real-time feeds to news organizations like The Associated Press, Tribune Media and Reuters, among others.
There has been much debate among venture capital-backed startups as to whether it's appropriate to take PPP. Albert Wenger, a partner at Union Square Ventures, wrote on his blog in early April that "there is a money grab going on right now by some venture backed startups that this program absolutely should exclude."
Wenger urged VC-backed companies with lots of money in the bank and limited COVID-19 impact to think twice about applying for PPP. Meanwhile, dozens of companies gave back their PPP loans amid public shaming, because they didn't need it.
In an interview with dot.LA at the end of March, Jukin's founder and CEO Jonathan Skogmo said the company has raised $6 million strategically from Disney, Samsung and Peter Guber of Sony.
"The $6 million we raised, we never touched, it sits on the balance sheet," Skogmo said, noting that many companies around him went out of business. "You have to play the long game, the short game is not going to win, it's not just growth at all costs. Slow growth is perfectly acceptable."
Skogmo also said the company has seen an uptick in videos from people who are getting creative while quarantined in their homes. His team had already reviewed hundreds of COVID-19 related videos and were representing dozens on the licensing side of the business at the time. Skogmo said the company has seen a rise in engagement of those watching their media.
Editor's note: dot.LA received funds of less than the $150K threshold for disclosure from the Payment Protection Program.
Updated with statement from Jukin Media at 3:11 p.m.
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