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Comment by vonnik | Hacker News Reader

SVB is an institution that has supported a lot of businesses in tech.

There are a lot of harmful clowns out there fearmongering. They should stop.

The failure of a bank like this, if it occurs, would be bad for a lot of people.

SVB has real liquidity issues that represents a material risk to your business when your account has more than 250k in funds.

Come on, fearmongering by a few internet trolls isn't going to change the outcome. If the bank fails, it was going to fail anyway. If it pulls through, it was going to anyway.

We have been banking with SVB for the last 5 years.

Not even once, they have done something for us.

I mean, you just said you backed with them, so clearly they provided you a service, one that other banks may have been hesitant to (traditionally)

Why would other banks be hesitant?

Startups have weird financial flows and risk profiles. A company shows up out of nowhere with a bunch of money and then starts screaming towards bankruptcy. Sometimes it crashes and is gone, other times suddenly a huge amount of money shows up out of nowhere and is wired into the account. And then the company starts screaming towards bankruptcy again, and then rinse and repeat. And sometimes they just go away forever and other times they randomly become a profitable business and suddenly mutate into a normal company with net income and stuff and go public. And also the random huge sums of money these companies get seem to be correlated, and you don't know whether you're in 2021 when all of these companies are going to be getting massive cash infusions left and right, or in 2023 when it just suddenly stops for some reason - even though those businesses don't actually look any better or worse. SVB claimed to be the expert in handling that super weird risk profile, and you can see how badly they misjudged that risk with their collapse.

You don’t understand why other banks may be hesitant to work with startups?

why did you bank with them if they have done nothing for you ?

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