Silicon Valley Bank’s collapse rattled the technology industry that had been the bank’s backbone, leaving shell-shocked entrepreneurs thankful for the government reprieve that saved their money while they mourned the loss of a place that served as a chummy club of innovation.
But the gratitude for the deposit guarantees that will allow thousands of tech startups to continue to pay their workers and other bills was mixed with moments of reflection among of entrepreneurs and venture capital partners rattled by Silicon Valley Bank’s downfall. Bank of America is getting some of the money that Electric Era had deposited at Silicon Valley Bank and the Seattle startup’s CEO Quincy Lee expects having no difficulty finding other candidates to keep the rest of his company’s money as part of its diversification plan.
Venture capitalists set up their accounts at Silicon Valley Bank just as the tech industry started its boom, and then advised the entrepreneurs that they funded to do the same. Many of Silicon Valley Bank’s roughly 8,500 employees now find themselves hanging in limbo, too, even though government regulators now overseeing the operations have told them they will be offered jobs at 1.5 times their salaries for 45 days, said Rob McMillan, who had worked there for 32 years.
Silicon Valley Bank is fading away at a time when startups were already having a tougher go at raising money as a downturn in technology stock values and a steady ride in interest rates caused venture capitalists to retrench. The bank often helped fill the financial gaps with one of its specialties — loans known as “venture debt” because it was woven into the funding provided by its venture capitalist customers.
'Chummy club of innovation' is an odd way to say over extended and poorly managed.
And the Biden ESG temple.
Weird take...
There are people out there that are thankful for the government? 😱