In a move that signals a vote of confidence in the future of Silicon Valley Bank, venture capital firms have agreed to support the bank and encourage their portfolio companies to resume their banking relationship with SVB if the bank is acquired and properly capitalized.
VCs Have Unwildering Faith in SVB
The VCs, which include Accel, Altimeter Capital, B Capital Group, General Catalyst, Gil Capital, Greylock Partners, Khosla Ventures, Kleiner Perkins, Lightspeed Venture Partners, Mayfield Fund, Redpoint Ventures, Ribbit Capital, and Upfront Ventures, issued a joint statement expressing their support for the bank.
According to Hemant Taneja, CEO of General Catalyst, the VCs met recently to discuss the systematic risk of Silicon Valley Bank’s downfall and the impact it could have on the startup ecosystem. The VCs acknowledged that SVB has been a trusted long-term partner to the venture capital industry, serving the startup community and supporting the innovation economy in the U.S.
In the statement, the VCs stated that they would be “strongly supportive” of Silicon Valley Bank if it were to be purchased and appropriately capitalized, and would encourage their portfolio companies to resume banking relationships with the bank.
Elon Musk to Buy Silicon Valley Bank
The future of Silicon Valley Bank has been the subject of speculation recently, with some suggesting that it could be acquired by a digital bank. Min-Liang Tan, CEO of Razer, recently suggested that Twitter should consider buying SVB and turning it into a digital bank, with Elon Musk responding that he was open to the idea.
While Elon Musk has plans to introduce payment support on the social media platform with fiat support, a fully developed banking infrastructure could be a great deal with the Silicon Valley Bank acquisition.
Despite recent challenges, including the closure of the bank by the California Department of Financial Protection and Innovation and the appointment of the Federal Deposit Insurance Corporation as the receiver, the support of these venture capital firms is a positive sign for the future of Silicon Valley Bank and the startup ecosystem it supports.