Wednesday, March 22, 2023

SVB: From Mumbai to Shanghai, tech heads vie to stop SVB’s collapse – Usky News

Half a world away from the chaos prevailing in Silicon Valley, Asia’s tech leaders are scrambling to assess the potential impact for an industry that has always relied heavily on connections to US capital and supercharged growth.
Financiers and entrepreneurs packed the ballrooms of Shangri-La during the Global Wharton Alumni gathering in Singapore, groups and tables bustling over delicious buffet meals with the latest news Silicon Valley Bank‘S (svb‘S) The spectacular eruption is a main topic of conversation on Friday.
In Mumbai, startup founders and investors chatted about little else at a conference, exchanging rumors about which fledgling company might be the first to collapse. In Shanghai, SVB’s local partner and the joint venture issued memos within hours of each other to quell concerns about their stability.
Over the past day, the region’s tech giants and family offices have watched the decades-old bank, which once held more than $200 billion in assets, with a mixture of dread and fascination in the downturn. The collapse sent shock waves through Asia as major investors and sovereign funds rushed to scrutinize their portfolios and expose investors to the failed lender, according to people familiar with the matter.
An Indian founder said he was unable to retrieve the company’s funds and is now left with only working capital. Another was rushing to intercept and re-route customer payments to his company’s SVB account, as well as setting up new systems for salary payments. Three founders and one startup investor said they haven’t slept in 48 hours.
Asia’s biggest funds including Sequoia, Temasek genfund And Yunfeng Capital They contacted their portfolio companies to find out their exposure to SVB, according to the people, who asked not to be identified.
Analysts said the deposits are important for tech startups as they typically require a lot of cash to pay for heavy expenses, including research and development costs and staff salaries. “If these cash deposits are eventually eroded in a bankruptcy or restructuring process, some tech firms could face higher cash flow stress,” the analysts said. Bloomberg


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