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.
Security guards let individuals enter the Silicon Valley Bank's headquarters in Santa Clara, Calif., on March 13, 2023.
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 entrepreneurs and venture capital partners rattled by Silicon Valley Bank’s downfall.The crisis “has forced every company to reassess their banking arrangements and the companies that they work with,” said Rajeeb Dey, CEO of London-based startup Learnerbly, a platform for workplace learning.
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.
That cozy relationship came to an end when the bank disclosed a $1.8 billion loss on low-yielding bonds that were purchased before interest rates began to spike last year, raising alarms among its financially savvy customer base who used the fruits of technology to spread warnings that turned into a calamitous run on deposits.
“We don’t know who’s going to pay us when,” McMillan said. “I think we all missed a paycheck. We don’t know if we have benefits.”
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