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spaceman_2020

> because tech startups usually lose money at the beginning of their lives

Oh what a 2010 thing to say!

2023 startups lose money for all their lives. SVB was running a bad business banking almost exclusively to startups that have never had positive cash flow.

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Right, and this is why they fundamentally failed. If their main depositors were traditional businesses and individual accounts they wouldn’t be an issue today. They invested their money as if they had low-risk depositors but a start-up is a high risk depositor——they don’t have a proven business model so it is hard to forecast their behavior.

To me this is classic SV echo chamber thinking. There’s a reason traditional banks are more wary of lending to start-ups and it isn’t because they hate money.

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