- Over 110 venture capital firms have signed a statement in support of Silicon Valley Bank.
- The SVB was shut down by regulators on Friday after losses on bond sales sparked a bank run.
- Some VC signatories have criticized investors who advised the founders to withdraw money from SVB.
Venture capital firms have expressed support for the bankrupt Silicon Valley Bank, which US regulators shut down on Friday.
“Silicon Valley Bank has been a long-standing trusted partner to the venture capital industry and founders,” said a joint statement from more than 110 companies.
“If SVB is acquired and properly capitalized, we strongly support it and encourage portfolio companies to resume banking relationships with SVB.
U.S. regulators shut down SVB after a significant portion of the bank’s customer base, including start-ups and venture capital firms, attempted to withdraw funds following the bank’s stock price plunge. loss.
SVB served nearly half of the US venture backed firms. According to its websiteand its failure has had a huge impact on the startup world. Some startups that had SVB accounts are now at risk of losing their employees’ salaries.
Hemant Taneja, CEO of VC firm General Catalyst, said: Led efforts to organize support for SVB, tweeted a statement on Friday night. In his own tweet, Taneja said several of his VCs met to discuss the impact of SVB’s failure on the industry. Alongside General Catalyst, 12 of his companies signed the initial statement, including Accel, Greylock, Kleiner Perkins, Lightspeed Venture Partners and Upfront Ventures.
In a statement to Insider, Taneja said, “It’s important that we work together with a consistent approach to help maintain our business continuity and keep our institutions important to our industry.” “We all understand that we have a role to play in calming the situation. Panic was not the way to deal with it. Before making a decision, stop and think about all the stakeholders.” It’s important, and it’s at the core of our responsible innovation mindset.”
number of signatories to Joint statement in support of SVB It has grown to over 110 companies including Cowboy Ventures, Eniac Ventures, Floodgate, Khosla Ventures, Lux Capital, Primary and SoftBank.
Eniac Ventures co-founder Nihal Mehta, who signed the statement, told Insider:
The VC industry’s statement of support for SVB stands in contrast to the panic among investors and startups when SVB’s problems came to light. Some VCs, such as Founders Fund, Y Combinator and Union Square Ventures, have advised their portfolio companies to withdraw most of their money from banks.
These reactions came under fire from other VCs, especially after SVB’s implosion. Both Upfront Ventures partner Mark Suster and Primary co-founder Brad Svrluga signed a joint statement of support and publicly warned fellow investors.