10 Companies affected by Silicon Valley Bank collapse
Silicon Valley Bank’s collapse on Friday 10 March, which is the second-largest bank failure in the history of the United States, has triggered financial system anxiety and shaken the tech industry. The incident has raised concerns about the ability of affected companies to recover their funds and pay their staff.
Following a surprise filing on Wednesday night, the federal government took over the bank when it was discovered that it had sold $21 billion in assets and was selling stock to raise funds. The bank was popularly known for serving start-ups, tech companies, and venture capitalists, and the aftermath of its collapse has impacted numerous companies.
Silicon Valley Bank: What happened?
On 10 March 2023, Silicon Valley Bank (SVB) was closed by regulators, marking the largest US bank failure since the Global Financial Crisis in the late 2000s (and second largest in US history). After the news broke, trading in SVB’s plunging shares was halted and US stocks lost more than 1% on Friday.
Here’s which companies were affected
Roku is a streaming TV platform that offers a wide variety of content through its devices, which are connected to the internet. Roku devices allow users to watch TV shows, movies, and other content from various streaming services such as Netflix, Hulu, and Amazon Prime Video.
Circle is a financial technology company that provides payment solutions and cryptocurrency services. The company offers a range of services, including Circle Pay, which enables users to send and receive money internationally, and Circle Invest, which provides a platform for buying and selling cryptocurrencies.
Roblox is an online gaming platform that allows users to create and play games with other players from around the world. It offers a range of games, from simulations to role-playing games, and is popular among children and teenagers.
Etsy is an online marketplace that focuses on handmade and vintage items. The platform allows individual sellers to create their own shops and sell a variety of items, from jewelry to home decor to clothing.
BlockFi is a cryptocurrency lending platform that enables users to earn interest on their cryptocurrency holdings. The company also provides loans to users who use their cryptocurrency as collateral.
Compass Coffee is a coffee roasting company that operates cafes in Washington D.C. and sells its coffee online. The company is known for its high-quality coffee and commitment to ethical and sustainable sourcing practices.
Camp is a family experience company that offers a range of activities for children and families, from day camps to sleepaway camps to virtual experiences. The company’s goal is to provide fun and engaging experiences that help children learn and grow.
Axsome Therapeutics is a biopharmaceutical company that develops and commercializes therapies for various central nervous system disorders. The company’s focus is on developing treatments for depression, migraines, and other conditions that currently have limited treatment options.
At Friday’s close, Axsome Therapeutics stock was valued at $58.39, 5.78 percent down from the day before.
While some attribute the collapse to poor management, others suggest that it was caused by the Federal Reserve’s interest rate hikes. The commenters expressed concern for the thousands of small businesses that may be affected by the collapse and question the potential bailout of SVB by the government. Some commenters criticize the article’s poor writing and lack of context, while others discuss the possibility of a Republican-led movement to end liability laws and federal regulation.
More than a hundred venture capital funds have signed a letter promising that once SVB resumes operations, whoever owns it, they will stay with the bank and encourage their portfolio companies to do the same.
1,200+ company founders and top executives signed a petition to Treasury Secretary Janet Yellen and the U.S. Congress urging them to pay the closest attention to the SVB situation, take action to compensate small companies, and restore strong regulatory policies to regional banks.
The waves will continue to dissipate – in addition to the USDC, which lost its peg to the dollar due to the fact that about 3.3 billion reserves were stored in the SVB, it will also suffer Etsy, or rather those who cooperate with the marketplace.
However, according to rumors, some hedge funds are already offering startups to buy back their uninsured funds that were in SVB accounts. The discount ranges from 60 to 80 percent.
But it is very interesting to see how some libertarians are hopelessly wedded to the dilemma – is it acceptable to use taxpayers’ money to save the bank where your uninsured deposit is? The opposite flank, however, is just as wedged, to the point of calling for all deposits to be fully insured, and at the expense of the banks.