As the public learns more about how the demise of Silicon Valley Bank (SVB) will affect the tech and startup world, fear of a bad 2008 reboot offers an easy narrative. But it’s not that simple.
ICYMI, here’s a recap of all things SVB, with whom much of the tech and startup world banked: Last Wednesday, the bank announced plans to sell $1.75 billion in stock shares and raise capital, causing panic among founders and investors. SVB’s stock took a tumble, and investors were advising founders to move money out of the bank.
Now, the bank is closed and under the control of the Federal Deposit Insurance Corporation (FDIC), which began an auction of the bank’s assets this weekend. All depositors who only had up to $250,000 — what’s insured by the FDIC — could access their funds as of this morning, and the FDIC will be paying an advance to everyone else in the next week. Those folks will also be getting their money back in full. At the end of last year, SVB controlled $209 billion in assets and $175.4 billion in deposits.
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