Bankruptcy of Silicon Valley Bank Sparks Concerns in Tech Industry

03/12/2023 08:16 • NFT Newsflash • 155 views

It is reported that after the bank of Silicon Valley announced its bankruptcy in a flash on March 10, it triggered a severe shock in the capital market. Investors are paying high attention to the possible chain reaction caused by the event. Lise Buyer, a senior adviser to the US IPO and founding partner of Class V Group, said that if the Silicon Valley Bank could not be rescued at the weekend, 80% of the startups supported by venture capital would be affected to varying degrees. Relevant regulatory filing documents show that as of December last year, more than 95% of deposits in Silicon Valley banks had not been insured, and many of these depositors were start-up companies. The market is worried that because enterprises may not be able to pay wages this month, this will in turn trigger a wave of large-scale closures and layoffs in the technology industry. (I)

International investors: Silicon Valley Bank may affect 80% of VC support enterprises if there is no rescue

Analysis based on this information:

The recent news of Silicon Valley Bank’s bankruptcy has sent shockwaves across the capital market, triggering widespread concerns about its possible consequences. According to reports, the event has raised high stakes for many investors, who are now closely watching the possible chain reactions that might follow.
Lise Buyer, a senior adviser to the US IPO and founding partner of Class V Group, has warned that if the bank could not be rescued at the weekend, almost 80% of the startups supported by venture capital would be affected to varying degrees. This means that many of the new tech companies that had pinned their hopes on funding from the bank would be left stranded without immediate access to crucial cash injections.

Recent regulatory filings have revealed that over 95% of the bank’s deposits at the end of last year were uninsured, with many of these belonging to start-ups that relied on the bank’s support. With many enterprises facing potential difficulties in paying wages, there is a growing fear that this could trigger a wave of lay-offs and closures in the technology industry.

The news of the bankruptcy comes at a time when the technology industry is already grappling with numerous challenges, including regulatory pressures, increasing competition, and shifting consumer preferences. Some analysts fear that the impact of the bankruptcy could easily spill over to other industries, causing a domino effect in the global economy.

Overall, the bankruptcy of the Silicon Valley Bank is a serious wake-up call for the technology industry, which is struggling to stay afloat in the midst of a global pandemic. It underscores the need for greater caution and preparedness among tech startups and their investors, who must learn to navigate the turbulent waters of the capital market with greater resilience and foresight.

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Bankruptcy of Silicon Valley Bank Sparks Concerns in Tech Industry

International investors: Silicon Valley Bank may affect 80% of VC support enterprises if there is no rescue

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