Indian startups worried by the collapse of Silicon Valley Bank | Loktej Business, World News
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The collapse of Silicon Valley Bank (SVB) in the US has left many Indian startups worried about the risk of their investments. According to data from Traxon, a global software-as-a-service (SaaS)-based market intelligence platform, SVB had exposure to at least 21 Indian startups, though the size of the investment was not disclosed. Also, SVB has not invested in any Indian startup recently. The California Department of Financial Protection and Innovation, which closed the bank, announced that all insured depositors will have full access to their insured deposits as of Monday, March 13, 2023. Startup founders are worried, however.
Gokul Rajaram, a board member of Pinterest and Coinbase, tweeted that “India-based founders don’t know who to turn to as an alternative to SVB,” the news agency reported. According to The New York Times, SVB was the bank of more than 2,500 venture capital firms, including Lightspeed, Bain Capital and Insight Partners. The report also said the bank managed the personal assets of several tech executives and was a major sponsor of Silicon Valley tech conferences, parties, dinners and media outlets.
Josh Butler, CEO of workplace safety analytics startup CompScience, expressed apprehension that he is unable to withdraw his company’s funds from the bank. “Everyone from my investors to employees to my own mother is reaching out to ask what is going on. The big question is how soon will we be able to access the rest of the funds, if at all? It’s absolutely terrifying. Is.” The Federal Deposit Insurance Corporation on Friday took control of SVB’s $175 billion in customer deposits and deposits up to $250,000 are insured by the regulator. However, the customers have not received any information on when they will be able to get their money back.
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