Silicon Valley exhales after US intervenes in SVB collapse
Turning a popular aphorism on its head was a ploy by the professors to enliven a technical discussion. Turning a popular aphorism on its head was a ploy by the professors to enliven a technical discussion.
Banking regulators said Sunday evening that depositors at Silicon Valley Bank, which was shuttered Friday, would have access to their funds Monday, putting to rest fears that startups would struggle to pay their employees this week. The bank's closure had followed interest rate hikes that hurt its startup customers and a failed capital raise attempt, spurring deposit withdrawals.
Despite the palpable relief, questions still remained about the funding environment for startups, which had come to rely on Silicon Valley Bank for support to back unproven businesses that larger banks eschew. And the bank still had not found a buyer as of Sunday, which was a hope of many venture capital firms and tech founders hungry for positive news.
“This is a huge step in restoring confidence in the startup community. Before this move many startups were planning emergency measures which would have likely led to more layoffs and furloughed employees. The actions have provided much needed certainty that everyone can make payroll on Monday,” said Jon Sakoda, founder of early stage venture firm Decibel Partners.
The bank's sudden shutdown sent a chill through Silicon Valley amid an otherwise gloomy period marked by tech layoffs and a pullback in spending as consumers tightened their wallets. Company executives, many of whom stashed all of their funds in Silicon Valley Bank, took to Twitter and other social media networks to beg for relief.
Sam Altman, who heads OpenAI, known for its ChatGPT artificial intelligence software, was among those who
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