How startup founders are reacting to Silicon Valley Bank's collapse, as some worry about frozen funds, operating expenses, and paying employees full salaries
'The Silicon Valley Bank (SVB), a leading lender to startups and venture capitalists … Bloomberg : Khosla Ventures Tells Some Startups Firm Will Cover Payroll South China Morning Post : China joint venture of Silicon Valley Bank says operations stable, independent Alex Konrad / Forbes : Silicon Valley Bank'sAbrupt Closure Leaves Venture Capitalists And Founders Scrambling Mashable : Silicon Valley Bank explained: How crypto is being affected. Taylor Soper / GeekWire : Lessons from WaMu: Historic financial failure offers clues to what's next for Silicon Valley Bank Ed Sim / What's Hot in Enterprise IT/VC : What's 🔥 in Enterprise IT/VC #332 Mastodon: Dr. Jorge Caballero / @DataDrivenMD@fedified.com : Silver lining: the debt ceiling will magically get fixed now that billionaires that were angling for cuts to social security and medicare will have to give up their tax cut in exchange for another government bailout of the banking sector. … Tweets: Bill Ackman / @billackman : From a source I trust: @SVB_Financial depositors will get ~50% on Mon/Tues and the balance based on realized value over the next 3-6 months. If this proves true, I expect there will be bank runs beginning Monday am at a large number of non-SIB banks. No company will take even a... https://twitter.com/... Dante Disparte / @ddisparte : @circle is currently protecting #USDC from a black swan failure in the U.S. banking system. @SVB_Financial is a critical bank in the U.S. economy and its failure - without a Federal rescue plan - will have broader implications for business, banking and entrepreneurs. https://twitter.com/... David Sacks / @davidsacks : Where is Powell? Where is Yellen? Stop this crisis NOW. Announce that all depositors will be safe. Place SVB with a Top 4 bank. Do this before Monday open or there will be contagion and the crisis will spread. @sumukhsridhara : We just built a product @AngelList to help startups impacted by SVB that need emergency capital: - Standardized Loan Agreement Docs (temporary loan from investors) with online signing & funding. - Built in banking access (if your company needs it) DM me if you need access https://twitter.com/... Garry Tan / @garrytan : Thousands of startups and small businesses are at risk due to the SVB failure. We ask for depositors to be made whole, and for regulation to prevent this catastrophe. 650 founders who employ more than 22,000 people, have already signed. https://www.ycombinator.com/ ...... https://twitter.com/... @garrytan : Regulators need to step in to do a *backstop* of depositors (not a bailout of a bank) 40,000 SVB depositor small businesses 30% will fail to make payroll in the next 30 days Estimate 10 employees each 120,000 jobs on the line Years of US innovation on the line Garry Tan / @garrytan : 650 founders who employ over 20,000 people have already signed this petition Thousands of startups and small businesses are at risk due to the SVB failure. We ask for depositors to be made whole, and for regulation to prevent this catastrophe. 650 https://www.ycombinator.com/ ...... https://twitter.com/... Matt Ford / @fordm : This doesn't exactly spark enthusiasm for a SVB bailout. https://www.nytimes.com/... https://twitter.com/... Ro Khanna / @rokhanna : The Treasury Department and FDIC must communicate loudly and clearly that depositors will be protected. The investors and executives of SBV should bear risk and lose. But this should not mean that workers go without paychecks on Monday or small businesses collapse. @om : The spiral of negativity can be self-consuming. (more thoughts here, https://om.co/... ) Eric Newcomer / @ericnewcomer : no atheists in a foxhole. no libertarians in a bank run https://twitter.com/... Jennifer Elias / @jenn_elias : “I'm trying to get a check!” one man yelled, knocking on the locked glass doors of SVB's Menlo office. “After this, we're putting our money in multiple banks,” one founder said to another he just met. “Us too—if we're still around.” More sights & sounds: https://www.cnbc.com/... https://twitter.com/... Jennifer Elias / @jenn_elias : “The same Bank funding VCs and doing all kinds of magic acts to keep their portco's alive (some of the very VCs that sent us and then left us hanging), their mgmt teams, leveraged lines - all gone,” wrote an SVB Sr. Market Manager on LinkedIn this morning: https://www.linkedin.com/... https://twitter.com/... Nikita Bier / @nikitabier : Coming up next week 1. Depositors at small banks move to JP Morgan 2. Everyone moves from cash to treasuries & money markets 3. Bank assets are no longer backed by deposits 4. More runs on banks 5. Socialists cheer on demise of small banks 6. Execs at big banks get mega rich https://twitter.com/... Kara Swisher / @karaswisher : Look at who is missing here and that will tell you a whole lot. https://twitter.com/... Andrew Lokenauth / @fluentinfinance : In 2022 Forbes named Silicon Valley Bank one of America's Best Banks, and Moody's gave them an A rating. SVB has been around for 40 years and was home to half of all venture-backed startups. Now it's the biggest bank failure since 2008 and the second-largest in US history. @om : Let me cut to the chase: as someone who has been part of the Silicon Valley ecosystem for three decades, this is the worst weekend I have experienced as part of the technology community. https://om.co/... https://twitter.com/... Robert Scoble / @scobleizer : Silicon Valley feels like this today: https://twitter.com/... Vinod Khosla / @vkhosla : Agree Fed needs to step up. But so do VC's. We are talking to 100+ portfolio companies assessing their needs and plan to bridge where we are a lead or major investor at our cost of borrowing only or under special circumstances where a company's investors are not able to respond https://twitter.com/... Vala Afshar / @valaafshar : SVB is not just a bank, it was at the heart of the American innovation economy. — @om https://om.co/... https://twitter.com/... BuccoCapital Guy / @buccocapital : Take a moment to thank your local Twitter generals for pausing their focus on the land war in Ukraine to share their insights on the banking system. We are grateful Ben Hunt / @epsilontheory : Let's all hope that Ackman is wrong in his information, because he's 100% right in his conclusion. https://twitter.com/... Jacob Silverman / @silvermanjacob : SVB operated differently than many American banks, apparently made poor decisions, and is now under a well-established FDIC process designed for these circumstances. Is the contagion fear real, or do billionaire techies and financiers just want to be made whole immediately? https://twitter.com/... Clara Jeffery / @clarajeffery : “Trump...lessened scrutiny for many regional banks. SVB's chief executive, Greg Becker, was a strong supporter of the move....it changed requirements for the amount of cash that these banks had to keep on their balance sheets to protect against shocks.” https://www.nytimes.com/... @nycsouthpaw : Part of the purpose of the FDIC cap, as I gather, is to encourage people and enterprises not to concentrate large sums of their cash in a single bank. Even if it's more operationally efficient, it exposes the despositor, their employees, the taxpayers, etc to undue risk. Alexandria Ocasio-Cortez / @aoc : How many of the Silicon Valley folks who lobbied Congress + Trump to cause this crisis are willing to admit they were wrong? I haven't seen a single one of these guys crying for a bailout take a single ounce of accountability for their actions. It's honestly shameless. @modestproposal1 : Oh my god. “Ideally”. How the ever living fuck did they not realize that announcing in the morning without concurrent pricing would cause a death spiral. https://twitter.com/... @livefromvr : Sillicon Valley doesn't quite grasp how indifferent Washington is to let thousands of startups fail through no fault of their own. The Fed doesn't quite grasp how enmeshed startups are in the modern economy and how much nonlinear blowback this will lead to. Ben Smith / @semaforben : Hedge funds offer to buy deposits stuck at Silicon Valley Bank | @lizrhoffman @ReedAlbergotti https://www.semafor.com/... Dan Primack / @danprimack : This is on top of the significant deposit inflows on Thursday & Friday. https://twitter.com/... Kate Clark / @kateclarktweets : Inbox: Brex says it's received $1B in payroll loan requests since it announced its emergency bridge credit line yesterday. Parker / @pt : Adding blogging to Twitter was a mistake that is gonna collapse the banking system. https://twitter.com/... Howard Lindzon / @howardlindzon : Yo founders...@angellist has a possible solution for those affected by SVB needing emergency capital - wonderful work https://twitter.com/... Aston Motes / @__aston__ : A bailout for shareholders here is unjustified, but having the government backstop deposits until a safe home for SVB assets is found just makes sense. Otherwise businesses are going to pull their money out of every regional bank ASAP. Josh Wolfe / @wolfejosh : SVB was great partner to Lux + many of our cos that wouldn't exist w/o them— REMEMBER: VCs despite our 📣puffery + promotion 🙄are just pass-thrus. The cash💰 AINT ours—VCs earn fees & profit share (if any) BUT the 💰 belongs to retirement plans, pensions, charities across US🇺🇸 https://twitter.com/... Rolfe Winkler / @rolfewinkler : If VC/PE/founders are concerned, they can make sure they perform on the ~$50b of capital call and private loans they've taken out. Not exactly subprime credits on the asset side of the balance sheet. https://twitter.com/... Rolfe Winkler / @rolfewinkler : Hard to see how American despositors lose anything here. At 12/31: $16b of equity, $19b of ST/LT debt, $14b of foreign deposits. Losses on treasurys wipe the equity, but still lots of cushion for uninsured American despositors. Jason Furman / @jasonfurman : BTW, the @nytimes requires inflation adjustment for movie records. But not for bank failure records. https://www.nytimes.com/... https://twitter.com/... Simon Mikhailovich / @s_mikhailovich : Bill Ackman's disingenuous excuse of SVB failure: “SVB's senior management made a basic mistake. They invested short-term deposits in longer-term, fixed-rate assets.” Borrowing short to lend long is how a fractionally reserved banking system operates. There was no mistake. Eliot Brown / @eliotwb : V prescient story from @JonathanWeil in Nov on bank risks Silicon Valley Bank bonds worth $15.9 B less than balance sheet value SVB: “There are no implications for SVB because, as we said in our Q3 earnings call, we do not intend to sell our [held to maturity] securities.” https://twitter.com/... Kara Swisher / @karaswisher : The #1 is a real nonsense scare trope coming from SV folks, who suddenly found religion (government) — there won't be a run on all the banks, even though the government has to act loudly and quickly by the end of the weekend since that one of its its critical jobs. https://twitter.com/... Christina Warren / @film_girl : 100% with all of this. You don't have to like the bank or the people who held their money there, but unless Citi, BoA or JPMC can step in by Monday, I don't want to think about what happens next. https://twitter.com/... Kara Swisher / @karaswisher : Wait, I forgot who I was for a sec and spilling tea is my job. MIA: Founders Fund, Andreessen Horowitz, Sequoia. @heidibraun : This sums up the last four years perfectly. Sadly, but perfectly. Much love to everyone battling it out today, this week, month, year, decade. Kindness always wins. https://twitter.com/... Nils Gilman / @nils_gilman : This is bullshit. If these startups have viable businesses, they will get recapitalized. The only people who will lose money are the VCs who gave the startups money, and now need to give them more money. NO BAILOUTS OF VENTURE CAPITALISTS. https://www.npr.org/... Mark Moss / @1markmoss : USDC stablecoin, which is or was fast on the path to becoming a US-CBDC, doesn't have your dollars anymore... they lent them to a bank that lent them to the government, and they went up in 🔥 https://twitter.com/... Garry Tan / @garrytan : Silicon Valley Bank failure could wipe out a whole generation of startups If there is not more action, this will become a contagion that spreads to other startups and other banks. Depositors must be made whole. https://www.npr.org/... Lorena Gonzalez Fletcher / @lorenasgonzalez : Wow! Incredible....VCs & start-ups realize it's actually illegal to have people do work without paying them. I thought that's just what they called a “business model.” https://www.bloomberg.com/... Kate Clark / @kateclarktweets : New: SVB wasn't just a bank—it was a central artery in the VC circulatory system. While other banks that handled huge clients might barely give a startup founder the time of day, SVB showered them with attention. Now it's gone. https://www.theinformation.com/ ... Stanley Roberts / @stanleyroberts : The ripple effect from this bank failure could be devastating. No matter how many millions you have in this bank members can only access $250.000 @FDICgov https://www.npr.org/... Amir Efrati / @amir : seems @RagingVentures is the @michaeljburry of the SVB saga https://www.theinformation.com/ ... $sivb https://twitter.com/... Henry Blodget / @hblodget : There were reasons for this bank run. And the trouble began long before this week... https://twitter.com/... @martinsfp : Some debate in the replies about how many UK startups are affected but... it's a lot. https://twitter.com/... Avni / @apatelthompson : Sweetest two sentences I've read in a long time. Shaking with relief. Heartsick for my fellow founders. I have faith that all is not lost and that there is salvaging. But I'm also certain won't be fast enough or enough enough to save all. 💔 https://twitter.com/... Senator Scott Wiener / @scott_wiener : The situation at Silicon Valley Bank has left many on edge SVB had $175B in deposits, a large % coming from SF small businesses, nonprofits & tech startups that are locked up due to the collapse. There are big ramifications if the Fed & US Treasury don't take fast action:🧵
We just built a product @AngelList to help startups impacted by SVB that need emergency capital: - Standardized Loan Agreement Docs (temporary loan from investors) with online signing & funding. - Built in banking access (if your company needs it) DM me if you need access https:/…
From a source I trust: @SVB_Financial depositors will get ~50% on Mon/Tues and the balance based on realized value over the next 3-6 months. If this proves true, I expect there will be bank runs beginning Monday am at a large number of non-SIB banks. No company will take even a..…
@circle is currently protecting #USDC from a black swan failure in the U.S. banking system. @SVB_Financial is a critical bank in the U.S. economy and its failure - without a Federal rescue plan - will have broader implications for business, banking and entrepreneurs. https://twit…
Where is Powell? Where is Yellen? Stop this crisis NOW. Announce that all depositors will be safe. Place SVB with a Top 4 bank. Do this before Monday open or there will be contagion and the crisis will spread.
Thousands of startups and small businesses are at risk due to the SVB failure. We ask for depositors to be made whole, and for regulation to prevent this catastrophe. 650 founders who employ more than 22,000 people, have already signed. https://www.ycombinator.com/ ...... https:/…
Regulators need to step in to do a *backstop* of depositors (not a bailout of a bank) 40,000 SVB depositor small businesses 30% will fail to make payroll in the next 30 days Estimate 10 employees each 120,000 jobs on the line Years of US innovation on the line
650 founders who employ over 20,000 people have already signed this petition Thousands of startups and small businesses are at risk due to the SVB failure. We ask for depositors to be made whole, and for regulation to prevent this catastrophe. 650 https://www.ycombinator.com/ ...…
The Treasury Department and FDIC must communicate loudly and clearly that depositors will be protected. The investors and executives of SBV should bear risk and lose. But this should not mean that workers go without paychecks on Monday or small businesses collapse.
“I'm trying to get a check!” one man yelled, knocking on the locked glass doors of SVB's Menlo office. “After this, we're putting our money in multiple banks,” one founder said to another he just met. “Us too—if we're still around.” More sights & sounds: https://www.cnbc.com/... …
“The same Bank funding VCs and doing all kinds of magic acts to keep their portco's alive (some of the very VCs that sent us and then left us hanging), their mgmt teams, leveraged lines - all gone,” wrote an SVB Sr. Market Manager on LinkedIn this morning: https://www.linkedin.co…
Coming up next week 1. Depositors at small banks move to JP Morgan 2. Everyone moves from cash to treasuries & money markets 3. Bank assets are no longer backed by deposits 4. More runs on banks 5. Socialists cheer on demise of small banks 6. Execs at big banks get mega rich http…
Oh my god. “Ideally”. How the ever living fuck did they not realize that announcing in the morning without concurrent pricing would cause a death spiral. https://twitter.com/...
Part of the purpose of the FDIC cap, as I gather, is to encourage people and enterprises not to concentrate large sums of their cash in a single bank. Even if it's more operationally efficient, it exposes the despositor, their employees, the taxpayers, etc to undue risk.
Take a moment to thank your local Twitter generals for pausing their focus on the land war in Ukraine to share their insights on the banking system. We are grateful
In 2022 Forbes named Silicon Valley Bank one of America's Best Banks, and Moody's gave them an A rating. SVB has been around for 40 years and was home to half of all venture-backed startups. Now it's the biggest bank failure since 2008 and the second-largest in US history.
Let me cut to the chase: as someone who has been part of the Silicon Valley ecosystem for three decades, this is the worst weekend I have experienced as part of the technology community. https://om.co/... https://twitter.com/...
“Trump...lessened scrutiny for many regional banks. SVB's chief executive, Greg Becker, was a strong supporter of the move....it changed requirements for the amount of cash that these banks had to keep on their balance sheets to protect against shocks.” https://www.nytimes.com/..…
A bailout for shareholders here is unjustified, but having the government backstop deposits until a safe home for SVB assets is found just makes sense. Otherwise businesses are going to pull their money out of every regional bank ASAP.
How many of the Silicon Valley folks who lobbied Congress + Trump to cause this crisis are willing to admit they were wrong? I haven't seen a single one of these guys crying for a bailout take a single ounce of accountability for their actions. It's honestly shameless.
SVB operated differently than many American banks, apparently made poor decisions, and is now under a well-established FDIC process designed for these circumstances. Is the contagion fear real, or do billionaire techies and financiers just want to be made whole immediately? https…
Agree Fed needs to step up. But so do VC's. We are talking to 100+ portfolio companies assessing their needs and plan to bridge where we are a lead or major investor at our cost of borrowing only or under special circumstances where a company's investors are not able to respond h…
Sillicon Valley doesn't quite grasp how indifferent Washington is to let thousands of startups fail through no fault of their own. The Fed doesn't quite grasp how enmeshed startups are in the modern economy and how much nonlinear blowback this will lead to.
SVB was great partner to Lux + many of our cos that wouldn't exist w/o them— REMEMBER: VCs despite our 📣puffery + promotion 🙄are just pass-thrus. The cash💰 AINT ours—VCs earn fees & profit share (if any) BUT the 💰 belongs to retirement plans, pensions, charities across US🇺🇸 https…
If VC/PE/founders are concerned, they can make sure they perform on the ~$50b of capital call and private loans they've taken out. Not exactly subprime credits on the asset side of the balance sheet. https://twitter.com/...
Hard to see how American despositors lose anything here. At 12/31: $16b of equity, $19b of ST/LT debt, $14b of foreign deposits. Losses on treasurys wipe the equity, but still lots of cushion for uninsured American despositors.
BTW, the @nytimes requires inflation adjustment for movie records. But not for bank failure records. https://www.nytimes.com/... https://twitter.com/...
Bill Ackman's disingenuous excuse of SVB failure: “SVB's senior management made a basic mistake. They invested short-term deposits in longer-term, fixed-rate assets.” Borrowing short to lend long is how a fractionally reserved banking system operates. There was no mistake.
V prescient story from @JonathanWeil in Nov on bank risks Silicon Valley Bank bonds worth $15.9 B less than balance sheet value SVB: “There are no implications for SVB because, as we said in our Q3 earnings call, we do not intend to sell our [held to maturity] securities.” https:…
The #1 is a real nonsense scare trope coming from SV folks, who suddenly found religion (government) — there won't be a run on all the banks, even though the government has to act loudly and quickly by the end of the weekend since that one of its its critical jobs. https://twitte…
100% with all of this. You don't have to like the bank or the people who held their money there, but unless Citi, BoA or JPMC can step in by Monday, I don't want to think about what happens next. https://twitter.com/...
This sums up the last four years perfectly. Sadly, but perfectly. Much love to everyone battling it out today, this week, month, year, decade. Kindness always wins. https://twitter.com/...
This is bullshit. If these startups have viable businesses, they will get recapitalized. The only people who will lose money are the VCs who gave the startups money, and now need to give them more money. NO BAILOUTS OF VENTURE CAPITALISTS. https://www.npr.org/...
USDC stablecoin, which is or was fast on the path to becoming a US-CBDC, doesn't have your dollars anymore... they lent them to a bank that lent them to the government, and they went up in 🔥 https://twitter.com/...
Silicon Valley Bank failure could wipe out a whole generation of startups If there is not more action, this will become a contagion that spreads to other startups and other banks. Depositors must be made whole. https://www.npr.org/...
Wow! Incredible....VCs & start-ups realize it's actually illegal to have people do work without paying them. I thought that's just what they called a “business model.” https://www.bloomberg.com/...
New: SVB wasn't just a bank—it was a central artery in the VC circulatory system. While other banks that handled huge clients might barely give a startup founder the time of day, SVB showered them with attention. Now it's gone. https://www.theinformation.com/ ...
The ripple effect from this bank failure could be devastating. No matter how many millions you have in this bank members can only access $250.000 @FDICgov https://www.npr.org/...
Sweetest two sentences I've read in a long time. Shaking with relief. Heartsick for my fellow founders. I have faith that all is not lost and that there is salvaging. But I'm also certain won't be fast enough or enough enough to save all. 💔 https://twitter.com/...
The situation at Silicon Valley Bank has left many on edge SVB had $175B in deposits, a large % coming from SF small businesses, nonprofits & tech startups that are locked up due to the collapse. There are big ramifications if the Fed & US Treasury don't take fast action:🧵
At least one startup was planning to do layoffs today, but the Silicon Valley Bank situation forestalled those plans because the business, which banked with SVB, no longer had the capital to pay severance https://www.bloomberg.com/...
Investment firm StepStone Group, for instance, told LPs Friday that SVB serves as its depository bank and credit facility provider and asked LPs not to wire outstanding capital to the firm's SVB account. https://www.theinformation.com/ ...
Watching venture capitalists panic as they realize they've been cosplaying as Howard Roark & we aren't living in The Fountainhead is something to behold...
Many have an array of opinions on the failure of Silicon Valley Bank. At the end of the day real people have been impacted by events that should not have taken place. There was trust, that was shattered today. https://twitter.com/...
How founders are reacting to Silicon Valley Bank's collapse: The ripple effect of SVB's downfall is reverberating throughout the tech sector. How founders are reacting to Silicon Valley Bank's collapse by... https://techcrunch.com/... > https://confirmsubscription.com/ ... #tech…
“You can use the code BANKRUN at checkout.” Here's how founders are reacting to SVB's collapse https://techcrunch.com/... w/ @bayareawriter @DominicMadori @Kyle_L_Wiggers @kirstenkorosec
TechCrunch looked at how founders are reacting to SVB's collapse. Spoiler alert, emotions are high. “I never thought about the need to have more than one bank account for a company,” one first-time founder said. “This could end some companies.” https://techcrunch.com/...
This is wild. This will effect so many more people outside of tech. For instance this company that partners with Medicare and Medicaid to deliver food and medicine to low income communities https://twitter.com/... https://twitter.com/...