What was previously a point of pride on Silicon Valley Bank's website now reads like a warning sign: nearly half of U.S. venture-backed technology and life sciences companies bank with the financial institution. Financial regulators on Friday morning shut down Silicon Valley Bank and put it in the hands of the FDIC, a jaw-dropping move that has created a crisis for startup founders and their financial backers.
Based in Santa Clara, Calif., Silicon Valley Bank has long been a key player in the Seattle region. GeekWire's reporting suggests that the percentage of tech startups in the Seattle area that used Silicon Valley Bank was even higher than the national average, upwards of 80% or more of the venture-backed companies in the area.
GeekWire co-founder John Cook, who started covering startups and venture capital before the dot-com bust, calls this an "absolute meltdown," the likes of which he hasn't seen before on the startup beat. On this special episode of the GeekWire Podcast, we talk about what caused the situation, what it says about the state of the tech economy, and what could be next for those impacted by the shutdown.
Related coverage:
- Tech startup leaders concerned about making payroll following Silicon Valley Bank meltdown
- Regulators close Silicon Valley Bank in stunning downfall for financial mainstay of tech industry
- Seattle VC firms tell startups to assess positions with Silicon Valley Bank amid funding concerns
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