Top VCs in a huddle to discuss Silicon Valley Bank collapse, vow to be ‘supportive’

In the aftermath of the Silicon Valley Bank (SVB) collapse, prime enterprise capitalists mentioned that they might be “strongly supportive” of the lender.

In a joint assertion, main VC corporations mentioned that for 40 years, SVB has been an essential platform “that played a pivotal role in serving the startup community and supporting the innovation economy in the US”.

The assertion was signed by Accel, Altimeter Capital, B Capital Group, General Catalyst, Gil Capital, Greylock Partners, Khosla Ventures, Kleiner Perkins, Lightspeed Venture, Partners, Mayfield Fund, Redpoint Ventures, Ribbit Capital, and Upfront Ventures.

ETtech in-depth: Silicon Valley Bank meltdown places Indian SaaS corporations on alert

The occasions that unfolded over the previous 48 hours have been “deeply disappointing and concerning”, they mentioned, including that “in the event that SVB were to be purchased and appropriately capitalised, we would be strongly supportive and encourage our portfolio companies to resume their banking relationship with them.”

Tweeting the assertion, Hemant Taneja, CEO, General Catalyst, mentioned: “Several VC leaders met today to discuss the aftermath of SVB’s downfall. This is a joint statement from all of us.”

ET on Friday reported that Indian traders and SaaS startups are rattled by the developments within the US. While some are carefully monitoring the developments, others have began transferring their deposits out from SVB.

ETtech explainer: how rising US rates of interest prompted a pincer motion on Silicon Valley Bank

“We moved 90% of our money from SVB to Brex in the first half of Thursday–I did it even before recommendation of VC funds,” Lightspeed-backed Rephrase.ai founder and CEO Ashray Malhotra advised ET. New-age lenders Mercury and Brex have come as much as be platforms of selection for many early-stage SaaS startups.

Late Friday, the US Federal Deposit Insurance Corporation (FDIC) mentioned that SVB was closed by the California Department of Financial Protection and Innovation.

Also learn | How Silicon Valley Bank served the tech trade and past

“To protect insured depositors, the FDIC created the Deposit Insurance National Bank of Santa Clara (DINB). At the time of closing, the FDIC as receiver immediately transferred to the DINB all insured deposits of Silicon Valley Bank,” it mentioned.

The FDIC will promote the property of SVB, whereas the DINB will preserve its regular business actions. While the insured depositors of SVB will obtain their insured deposits, the uninsured depositors within the financial institution can be paid dividends from the asset sale.

The financial institution’s world fund mortgage banking e-book was comprised of 56% of loans to enterprise capital and personal fairness corporations as of the tip of final yr, as per a Bloomberg report.

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