On Monday, the U.S. Small Business Administration released information on the millions of loans it granted to various small businesses. Among the many company names listed, the most shocking one was Kanye West’s apparel company, “Yeezy.” It was reported that Yeezy received a loan ranging from 2 to 5 million dollars, and was subsequently able to retain 106 jobs. While retaining jobs is always a positive, the question becomes why did Kanye West and Yeezy need this loan?
The two main criticisms of Kanye West accepting this loan have to do with his personal wealth and the perception of his company. A few months ago, Kanye West was declared a billionaire. In that case, wouldn’t it be unfair for a billionaire to accept government assistance, especially if he has the funds to cover the loan? From a business standpoint, taking a loan from the government, which is “forgivable if [his] business spend most of the funds on payroll and other approved costs,” might be a smart move. In other words, if a businessman has the ability to use government assistance to keep jobs at his company, shouldn’t he? On the flip side, is it ethical to do so? Moreover, does accepting this loan take money away from other businesses who need it more?
The other criticism has to do with Yeezy’s label as a “small business,” within the context of receiving a small business loan. Yeezy achieved a 3 billion dollar valuation and falls under the umbrella of the international corporation, Adidas. Thus, many have argued that there is nothing “small” about Kanye West’s company. According to the U.S. Small Business Administration, a small business is determined by their “size standards,” which encapsulate factors of “affiliation with other business,” “total income,” and “employee calculation.” While total income and affiliation would likely disqualify Yeezy from a small business loan, Yeezy reportedly has around 100 employees. This number of employees likely qualified Yeezy as a small business.
As Kanye has been all over the news for his presidential bid, GAP campaign, and more, it will be intriguing to see if this loan decreases Kanye’s public appeal. As of yet, Kanye and his team have not commented on this information.