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Today, only one story is on everyone’s lips: the sudden and dramatic collapse of Silicon Valley Bank (SVB), the 40-year-old Silicon Valley institution. With $209 billion in assets under management at the time of the failure, it is the second largest bank failure in US history.
A large number of startups suddenly found themselves in trouble when the bank went through a Swift-Velocity Breakdown. In this special edition of the Daily Crunch, we summarize what the Sudden Value Bust means to the industry.
The businessupdates.org top story
- Regulators are stepping in: Natasha M reports that the bank and its 17 branches have been closed by the California Department of Financial Protection and Innovation. The bureau has appointed the Federal Deposit Insurance Corporation (FDIC) as trustee.
- So, um, what happened?: (TC+): Alex can be trusted to provide the context, concluding that it appears that the rumor that the SVB was in trouble caused a run on the bank, putting it in actual problems soon after.
- What the founders think: Several of my colleagues took to the (virtual) streets to hear how founders react to the bank’s collapse.
The Fall of Silicon Valley Bank
Before the bank was shut down by regulators, a lot happened quickly:
- For you, special price: Manic And Ingrid heard that Silicon Valley Bank was in talks to sell itself.
- Get out while you can: Natasha M And Alex reported that VC firms began advising their portfolio companies to withdraw money from SVB (TC+).
- A bump in the road: Natasha M wrote that some SVB customers had difficulty withdrawing money from the bank.
- In free fall: Natasha M And Alex followed by their message that SVB shares were falling as the whole mess unfolded.
- Filling the void: Never the ones for wasting a good crisis, startups jump into the breach to fill the vacuum SVB leaves for the ecosystem, Natasha M And Mary Ann reported.
- Maybe aim better: You might imagine that someone at Silicon Valley Bank would have stopped to think, “Hmm, maybe today is not the right time to declare that we are strengthening our balance sheet”, Connie writes, and concludes that SVB has rather spectacularly shot itself in the foot in the wake of crypto bank Silvergate’s announcement that it is closing. Jaquelyn analyzed Silvergate’s downward spiral for TC+.
- So, uh, now what?: As SVB funds are locked up (at least until Monday, regulators say), how do you comply with payroll, etc? Alex takes a closer look at what startups have to deal with (TC+).
Building a lean B2B startup growth stack
Selecting the right tool for the job is easy if you already know exactly how to do it.
However, most B2B growth marketers don’t have a blueprint to work from. That’s why Keith Putnam-Delaney, CEO of Primer, shared a guest post with TC+ highlighting which tools are best suited for early-stage, mid-stage, and late-stage startups.
“The current fiscal environment should be viewed as a net positive by marketers,” he writes. “It forces teams to think deeply about what is absolutely necessary, which tools will add (or subtract from) efficiency.”
businessupdates.org+ is our membership program that helps founders and startup teams lead the way. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!
And also some other news
OK, fine, there goods other things happen except SVB is going straight to hell today without even passing “go”. Here are a few things worth reading on the rest of the site…
Lots of cyber security news today like Carly reports that the SEC is suing Blackbaud for failing to disclose the ‘full impact’ of a ransomware attack; Bag writes that Telehealth startup Cerebral has shared millions of patient data with advertisers; and Zack also reports that PeopleGrove’s security has allowed users’ personal information to expire. In the meantime, Lorenzo dived in to investigate how the FBI proved a remote administration tool was actually malware.
And here are also some non-SVB, non-cybercrime headlines for you. Aren’t we generous today: