Market Overview

Mark Cuban On Texas Businesses Reopening, Small Business Loans

Share:
Mark Cuban On Texas Businesses Reopening, Small Business Loans

Billionaire investor and "Shark Tank" personality Mark Cuban was a guest on CNBC's "Squawk Box" segment Friday to discuss the easing of the business shutdown in Texas due to the coronavirus. 

Texas Economy: No Reason To 'Feel Bad'

Businesses in Texas were given the green light to reopen Friday so long as they operate at 25% capacity, and there is no reason to "feel bad" about the decision, Cuban said.

Many small businesses are unlikely to open under current conditions, which implies that only a "small subset" of businesses are opening, and this will generate "good knowledge" on how best to further proceed, he said. 

Cuban said there will be a few sets of challenges for business owners.

First, many workers, especially those that rely on tips, may not even be willing to come back to work if their income is depressed due to the lower capacity rules, Cuban said.

It is possible this group could end up collecting more money on unemployment, he said. 

Second, business owners may need to invest heavily in new costs associated with health and safety, like dealing with an HVAC system. 

These issues haven't necessarily been addressed yet, which implies that the announcement of the re-opening of the economy is more for perception than reality, Cuban said. 

Small Business Loans

Small business owners that are backed by wealthy investors have been put in a difficult position where they are left out of government loan programs, Cuban said.

For example, Cuban said that if he invested $25,000 in a "Shark Tank" company, the business owner would be precluded from obtaining loans due to having a billionaire investor.

The loan program was designed very quickly and "hasn't been thought through," and this shouldn't necessarily come as a surprise, he said, adding that he's been trying to work with the U.S. Treasury for clarification. 

Cuban recommends that business owners apply for loans at smaller community banks, even if they have accounts with major nationwide banks.

There is no rule against applying at multiple institutions, he said; the only rule dictates that a business owner can only accept one loan.

Related Links:

Amazon Shares Will Continue To Surge After Pandemic Subsides, Mark Cuban Says

Mark Cuban Says Shake Shack Returned $10M Only After 'Public Outcry'

 

Related Articles

View Comments and Join the Discussion!

Posted-In: CNBC Mark Cuban Small Business Loans texasMedia Best of Benzinga