Most of the money of our startup is put in that bank. We not sure if we will be able to get the next payroll. Any other startup in the same situation?
Software Engineering Career
Yesterday
1799
Cleared Amazon onsite, but lowballed.
Personal Finance
Yesterday
1081
What do you think the Fed will do tomorrow?
Tech Industry
Yesterday
1376
Update: Trans Coworker Stealing Breast Milk
Tech Industry
Yesterday
3467
Crossed a line with my boss
World Conflicts
Yesterday
427
American police seem to work only when Israel is challenged
Hearing a lot of the same. Sympathies, best of luck.
What’s the FDIC insurance amount limit for companies? Is it also 250k?
90%+ SVB assets are not insured
OK, thanks for that. But what’s the individual limit of insurance for a business account?
Yes, we're in the same situation. Not sure, what's going to happen. Going to ask our CEO and CTO over lunch.
Lunch is over. What did they say?
Bro got fired
Isn’t there something like $152b not insured?
Source?
Yes that’s correct
Our CEO is a dumbass
Do tell. 🍿🍿
rip
Equity will be wiped out, unsecured debt holders will be wiped out, most uninsured deposits are probably fine, maybe a small haircut. It’s not like the money is all gone.
Money ain’t gone at all, just may be frozen for a bit as the mess gets untangled. Will be funny to see the poorly run startups who stashed all their cash at SVB, shit their pants a bit
Why funny?
What happened
Honestly confused by all of this. Was there a reason for people to bank run?
yes SVB was having a liquidity crisis and announced a capital raise. that started the run. i mean just read the news
Diversify your banking deposits next time or hire a good finance person. Your VC’s should have also given you this advice…
Don’t give them too much credit. Most VCs are not that smart.
Jobox, VC’s have a fiduciary responsibility to their portfolio companies and that includes financial risk management. Having said that, everyone and their buddy are leaving corporate these days to start up “the next best VC fund”. It’s become ridiculous
To be fair, Peter Thiel really fucked up this situation. There's a way to go about getting his foundeds fund to diversify their banking positions without casuing a mass panic and starting a bank run. For anyone wondering what happened, Peter Thiel advised his FF to get their money out of SVB asap because he questioned the banks ability to payback funds. SVB had an influx of deposits in 2020-2021 and invested those funds in non liquid assets like mortgage backed securities. Now, we have a real interest rate and deposits from last year are still earning 1-3% and customers want to pull their funds and reinvest them at the current 4-5% you can get. This incurs fees that SVB has to pay to break large covenants with their lending partners that they did not have on hand, causing a statement for the need for capital and a bank run
I don’t disagree with you at all, however VC’s have a fiduciary responsibility to their portfolio companies and he was required through that to provide advice when he saw risk. I personally think VC money needs to have stronger regulatory oversight & that applies to banks like SVB too
But he created the risk by starting the panic that led to a bank run. There was little risk of full insolvency here and more of a risk against adequate returns on capital. By that definition, he didn't act in their best interest.
hope they have assets to cover deposits
they have but will need to sell at great discount
How do they liquidate the shares if no one will buy