With the news of Silicon Valley Bank's failure, people are wondering about the safety of our financial institutions. But the reality is, banks fail surprisingly often. The difference with SVB is that its sudden demise impacted a large number of known brands, startups, and venture capital firms who all had complete confidence in their financial partner. And there’s concern that “herd mentality” could cause other companies to start withdrawing deposits from other financial institutions, creating a domino effect.
So, should we be concerned? Yes and no.
