181–190 of 1001 posts
Now we just need an "incredible journey" blog post from SVB spinning this acquisition as a great win for both customers and investors.
Earlier quoted context omitted.
40% of startups just had their bank accounts cut down to $250k, so... a lot.
I'm not sure how true this is. I worked at a startup that took in over $100m in investment, and I was curious so I asked the cofounder how they protected that. According to him the money was divided up into chunks smaller than $249k, pushed off to a custom entity made just for the purpose, and then invested in bonds or CDs on a rotating basis. I'm sure a lot of startups will be in trouble, but those that are working…
What a debacle. Some gallows humor from twitter: "Imagine raising $100m for your AI enabled dog washing app - and your bank sets it on fire before you can". Original: https://twitter.com/88888sAccount/status/1634028258500169731...
Its so funny until you realize your seed-round investment in a friends company used SVB. Gonna be quite a show, this.
Now we just need an "incredible journey" blog post from SVB spinning this acquisition as a great win for both customers and investors.
LMAO. Can't even believe how many people were confidently asserting that nothing was wrong yesterday. If you had more than $250k in SVB yesterday you probably just took a huge haircut. Hundreds of startups will become illiquid as a result of SVB's collapse, and there will be major layoffs here in the next 90 days as founders realize that they lost their funds and cannot raise in the current VC environment.
> If you had more than $250k in SVB yesterday you probably just took a huge haircut. You may not lose money. The money isn’t gone yet. The restructuring may save the money. There’s a playbook for this sort of thing.
I think I'm going to start asking potential employers where they do their banking.
Oldie but goodie on what actually happens when a bank is taken over. https://www.npr.org/2009/03/26/102384657/anatomy-of-a-bank-t...
This case is unique because of the sheer volume of non-FDIC insured deposits. Substantial risk of depositors not being made whole for a while, they’ll probably get all their money but it will still be bad
SVB owned a bunch of mortgage backed securities and treasuries - both of which are down 30-50% from their peaks, which coincides with our last venture capital boom. SVB was buying at the top because they had so much capital to deploy.
Maybe instead of cashing it out, depositors could be given a treasury worth 30% less than SVB paid for it, that pays out 1% a year in interest, redeemable at face value in just 20 short years.
So any startup which had more than $250k in SVB only has $250k left now I'm assuming? Hopefully this doesn't have a bad domino effect.
The rest is limbo until the bank is liquidated and the remaining money is distributed.