NEW YORK: Silicon Valley Bank's stunning collapse has led to the freezing of tens of billions of dollars stored there by start-ups and their private equity backers, raising fear
has led to the freezing of tens of billions of dollars stored there by start-ups and their private equity backers, raising fears of a wider tech sector fallout.
"They helped us recruit people, helped with securing mortgages for transplants, gave financial advice to new executives ... So their disappearance is a real loss," he said. "The real victims of the SVB fallout are the depositors: Start-ups with 10 to 100 employees, who cannot make payroll, and will have to furlough or shutdown workers as soon as Monday," tweeted Garry Tan, head of the well-known incubator Y Combinator.
Champ Bennett, cofounder of the video platform Capsule, revealed on Friday that the US$5 million raised in mid-February during the company's first seed funding round was housed at SVB and now inaccessible.Bennett added that an intervention should not be viewed as"bailing out 'The 1' or 'Big Tech'", pointing to the"thousands of the most hardworking, talented individuals" at impacted companies who are currently"struggling".
Like others, Bennett says he is also concerned about the fate of other banks favored by the tech industry, including California's First Republic, whose stock price fell 30 per cent in two days.
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