(Bloomberg) — More than 100 venture capital and investment firms have signed a statement supporting Silicon Valley Bank, calling for limiting the fallout of the bank’s collapse and a potential “extinction-level event” for tech companies. part of a growing industry call to avoid
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As of Saturday afternoon in San Francisco, about 125 venture firms had signed the statement, according to a person familiar with the matter, including Sequoia Capital, led by venture firm General Catalyst. First issued on Friday by a small group of signatories, the statement called the events of the past two days “deeply disappointing and concerning,” and said investors would continue to have a relationship with the institution if it were bought by another entity.
Also on Saturday, startup incubator Y Combinator posted a petition to US Treasury Secretary Janet Yellen and other regulators signed by hundreds of founders and CEOs, calling for relief and attention to the immediate significant impact on small businesses, startups and their employees. was demanded. who are depositors in the bank. The petition asked for small businesses that had deposited money in the Silicon Valley bank, and asked for Congress to “reinstate stronger regulatory oversight and capital requirements for regional banks”.
On Friday, a group of investors from high-profile firms met over Zoom in a series of meetings, according to a person familiar with the discussions. General Catalyst CEO Hemant Taneja posted the resulting statement on Twitter after the meetings, indicating support from Kleiner Perkins, Khosla Ventures and others. In the hours that followed, more than 100 other firms, including Sequoia, signed on, said one of the people, who asked not to be identified because the discussions were private.
“Silicon Valley Bank has been a trusted and long-standing partner to the venture capital industry and to our founders,” the statement said. “For forty years, it has been an important platform that has played a vital role in serving the startup community and supporting the innovation economy in America.”
General Catalyst’s Taneja told Bloomberg that it was important for tech leaders to “communicate and agree on a sustainable approach that we hope can maintain business continuity for our companies.” He added: “Everyone understands that we have a role to play in trying to defuse the situation.”
Taneja also said that “the run on the bank was an unintended consequence of many investors trying to do the right thing for their companies” and that “panic was not the way to handle it.” He said he wished investors instead of advising companies to withdraw all their cash directed them to withdraw three to six months of operating capital from the bank.
Many tech leaders have been in touch with lawmakers and regulators since the collapse of SVB, encouraging them to focus on the companies and jobs that are at risk due to the crisis.
For VCs and startups, the mood was dark in Silicon Valley over the weekend. On Saturday morning, tech industry investors, founders and executives canceled weekend plans for their companies and firms to try to cushion the fallout from the collapse of Silicon Valley Bank.
Several investors took to Twitter and other channels to plead their support for SVB depositors. Y Combinator chairman Gary Tan on Friday called the bank’s collapse an “extinction-level event” for the companies and tweeted calls for regulators to intervene.
On Friday night, several investors and startup founders attended a webinar with US Congressman Ro Khanna, a Democrat from Santa Clara, California, that ran for more than two and a half hours. A person present said that Khanna expressed disappointment at the White House for remaining silent on the issue. A representative for Khanna said he answered 70 questions, and that the meeting was mostly focused on helping startups build payroll.
On Saturday, the congressman tweeted that he was urging the White House and Treasury Department to do “whatever is legally acceptable” to support the bank.
– With assistance from Hannah Miller.
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