“I personally stick to SVB.” Well-known tech figures promise support to banks
After a roller coaster week for Silicon Valley bank clients, some prominent tech people are now publicly saying they will keep their money with an embattled lender — and they encouraging others to do the same.
“As venture capitalists and clients of SVB, we recommend that our portfolio companies retain or return 50% of their total capital in SVB,” the post reads. joint statement this week from a coalition of large venture capital firms that included Lightspeed Venture Partners, Mayfield Fund and Upfront Ventures. “We believe that SVB is now one of the safest and most reliable banks in the country.”
The public display of support followed the sudden collapse of the bank on Friday. weekend for startup executives not sure if they can get paid, and then the federal government’s announcement on Sunday that it would step in to ensure that all investors will be saved. It also comes after the regional bank saga felt the shock waves in the world financial markets.
Willy Ilchev, Partner at Two Sigma Ventures tweeted On Tuesday, he spoke to an executive who planned to move his money back to the bank because “it’s now the safest bank in the US.” Ilchev added: tank.
The public support came after some venture capitalists were previously accused of helping fuel the initial online panic that sparked the bank run and led to its collapse. The drive to continue doing business with Silicon Valley also highlights the unique relationship and interdependence between the technology lender and the startup community.
The bank has worked with almost half of all venture technology and medical companies in the United States. Its collapse has only exacerbated a difficult season for the tech industry, as venture funding falls, interest rates rise, and broader macroeconomic uncertainty means less funding for the ambitious, money-losing projects that have emerged in Silicon Valley over the past decade. .
But not everyone shares the desire to remain loyal to the bank after its collapse. In response to a joint statement from a group of venture capital firms urging people to continue banking with Silicon Valley Bank, the CEO of one of the startups answered on Twitter: “Honest question: why would I do this after they made me go through one of the worst 48 hours of my life?”
A handful of America’s largest banks, including Bank of America, Wells Fargo and Citigroup, experienced significant growth in deposits after Silicon Valley Bank ran into trouble last week. told CNN. And several company executives have already told CNN they have tried to open bank accounts elsewhere after the events of last week, with one saying: “I don’t want to do this again.”
Nevertheless, statements about support from venture capitalists partly echo the statements of the bank itself.
“The first thing you can do to support the future of this institution is to help us rebuild our deposit base by leaving deposits at Silicon Valley Bridge Bank and returning deposits from the past few days,” Silicon Valley Bank recently said. appointed CEO Tim Maiopoulos wrote in a memo to clients on Tuesday.
Maiopoulos also stressed that the Biden administration’s claim that all deposits are fully protected by the Federal Deposit Insurance Corporation “actually means that deposits held at SVB are among the safest of any bank or institution in the country.”