Or by raising earlier than expected, as a down round? I don't understand why a solid company would be in trouble (though I'm not convinced that a high proportion of SV companies are actually solid).
Raising down rounds will be lower on the priority list to layoffs. Most companies would vastly prefer to buy more time to grow into their next milestone than to admit they can't achieve it and raise at a lower valuation. We generally know this to be true, in part because we just watched it happen across the entire tech ecosystem over the last ~12 months or so.
Logically, it makes sense. VC backed startups operate on optics and momentum. Layoffs are recoverable, failing to hit goals is much less so (I'm speaking purely about optics here, not my personal preference).
> though I'm not convinced that a high proportion of SV companies are actually solid
This is likely accurate. But that's not necessarily criticism, most companies in their early days aren't "solid" (if by solid you mean default alive and/or having a path to profitability). SVB is overly exposed to these types of clients, which is why I think there stands to be a large impact here if depositors need to take a 10-20% haircut.
At the same time, I really have a preference for people who didn't sign up for this kind of risk (I.e. most companies are Seed-Series B companies who understood the risk that the company might fail, but not the risk that their company had all their cash in one bank that failed), to not be laid off as a result of this.
It's a tough time.
Furthermore it is unlikely this will even affect anyone that is actually vulnerable like workers at Walmart for example.
Regardless, you're not replying to a thread where anyone claimed that the government should bail anyone out. You're replying to a thread where I mentioned that taxpayers are going to foot this bill one way or another. Either because the government does bail out the bank, or because regular taxpayers lose their jobs in the fallout.