Quang Hoang, the co-founder of a startup called Birdly Inc., spent his Monday refreshing the website of Silicon Valley Bank every hour. His San Francisco-based mentoring startup had about $10 million deposited with the now-failed financial institution, patronized by a large portion of the country’s most promising tech companies. But as afternoon turned to evening, he still hadn’t been able to recover his cash.
Hoang was one of thousands of founders globally trying to track down their money this week after days of chaos, and who are completely rethinking the way they bank. Startups from Silicon Valley to London, Tel Aviv and tech hubs across Africa depended on SVB as a one-stop shop for everything from holding their fortunes to personal mortgages. Now they face a financial reckoning. Many investors and tech firms believe that the future will be significantly more difficult, even if the bank continues to solicit deposits under its new name.
Deals ranging from venture debt financing to funding rounds are likely to be impacted by recent days’ upheaval. As startups grapple with the logistics of moving money around and opening accounts at new banks, general partner at Race Capital Edith Yeung believes that transactions will likely be delayed or even scrapped amid the bedlam.
