If 10 or more startups announce that due to the events this week at SVB they need to liquidate and shutter operations. Will include acquisitions at significant discount to valuation at time of last funding, or if unavailable based on comments by the founders or investors on the reason for an unexpected or hastily executed sale.
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Silicon Valley Bank, oh what a mess,
Startups may suffer from its distress,
But to predict ten will meet their end,
Is too bold, let’s wait and see my friend.
I’m guessing anyone forced to close or liquidate cheap will blame SVB. It’s a free opportunity to shirk responsibility.
This should be negligible now that the FDIC is guaranteeing all the deposits, right?
Can’t vouch for the source, but until I get better data, I’m assuming 30% of all start ups were with SVB:
Across the world or just in the US?
@AbhijeetY Only SVB in the US has failed I believe. They have subsidiaries in Asia and Europe that are independently regulated.
@BTE yes but a lot of YC backed startups - operating in India - had US based VC funding parked in SVB. Do they count?
@AbhijeetY Yes I will count any YC company since they all relocate to the US at least during the program so could easily be exposed.
I expect this number of startups to fail and to then blame the collapse unless it is completely implausible as an excuse (which it might end up being, if the bank gets rescued by Monday morning).
Would it count if they startup did not have their own money in SVB, but could not get their invoices paid from other companies which did?
@MatthewRitter No. This is just about companies with a direct relationship with svb.
I would expect at least 10 startups to fail per 90d just a base rate, so it seems reasonably likely that they will cite SVB as the proximate factor