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Does any one knows if VCs have contracts with startups where they have to deposit X amount weekly or monthly? Now if they can't because of the SVB debacle, can the startups sue them? This would put these VCs in even worse situation - not only they could be out of their money deposited at the bank but now they owe even more money to the startups.

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The VCs don't "owe" money to the startups: they "buy" equity with their money. The VCs aren't "out" the money deposited by the startup at SVB; that money was already exchanged for equity in the startup.

The VCs aren't happy because they and the startup both expected that the money-equity exchange meant that the startup would have working capital, so potentially the value of the equity that they got has fallen. This is a problem for both parties.

Yes they buy equity but do they always pay upfront? I would imagine that they have some contracts structured in a way that allows them to pay in rates based on performance etc. Also, what if some vc signed contract last week with payment due this week and they can't pay. I dont expect a lot of cases like that but i suspect few did.

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