Observed Signal · Mar 12, 2023 · Financial Crisis · Source: Trending Topics · Impact: 4/5 · Sentiment: Negative
Silicon Valley Bank Collapse Threatens Thousands of Startups
Silicon Valley Bank (SVB) collapsed in March 2023 within 48 hours, sending shockwaves through startup ecosystems worldwide. The bank served more than 35,000 startup customers and 2,600 venture capital and private equity firms, with subsidiaries in the UK, Germany, Canada, India, Israel and other markets. A bank run on Thursday saw $42 billion withdrawn. Deposits up to $250,000 are insured by the FDIC; the fate of uninsured deposits remained uncertain. Companies holding cash at SVB include Circle Financial, Roku, and Roblox. Over 3,500 founders signed a Y Combinator petition urging Treasury Secretary Janet Yellen to protect smaller depositors. More than 125 VC firms, including Accel, General Catalyst, and Greylock, publicly backed a takeover or appropriate recapitalization of SVB. Regulators weighed emergency measures, while the UK subsidiary was placed into insolvency.
The SVB collapse threatens the liquidity of thousands of tech startups and VC funds globally, many of which operate in adtech, martech and AI, potentially triggering a funding winter and reducing digital ad investment.
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Key Takeaways & Evidence Grounding
- SVB collapsed within 48 hours after a bank run; $42 billion was withdrawn on March 9, 2023.
- SVB had roughly $175.4 billion in deposits at the end of 2022 and a balance sheet of $209 billion.
- More than 35,000 startup customers and over 2,600 VC/PE firms worldwide were affected.
- More than 3,500 CEOs and founders signed a Y Combinator petition to Treasury Secretary Janet Yellen demanding protections for smaller SVB customers.
- Companies with known SVB exposure include Circle Financial ($3.3B), Roku ($487M), and Roblox ($150M).
Connected Companies & Entities
28 Entities mapped“Collapsed within 48 hours, described as the 'house bank' of the startup industry....”
“Listed as a known company with $3.3 billion held at SVB....”
“Listed as a known company with $487 million held at SVB....”
“Listed as a known company with $150 million held at SVB....”
“Listed as a known company with undisclosed funds at SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Startup accelerator that calculated nearly 40,000 SVB depositors were small businesses and started a petition....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Mentioned as a potential buyer of SVB and as the historical acquirer of Washington Mutual....”
“Reported to have told portfolio companies to withdraw funds from SVB, fueling the bank run....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Reported to have told portfolio companies to withdraw funds from SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Mentioned as a possible buyer of SVB....”
“Said to have abandoned a purchase of Lehman Brothers in 2008....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Mentioned as a possible buyer of SVB....”
“Reported that 30 to 50 percent of uninsured SVB deposits could be recovered....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Among VC firms in a joint statement supporting a buyer or recapitalization of SVB....”
“Mentioned as a possible buyer of SVB....”
Ontology Mapping & Concepts
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