That's great for people who have a finance team, but a startup with over $250k in the bank can easily be just one or two people who raised money and have no particular finance expertise.
Personally I think we should bump the limits - it should be reasonable for a startup that just raised $10m to be able to put that money somewhere safe, and pay rent, payroll, and an AWS bill with it, without having to hire a "finance team".
Aren't VCs supposed to support their investments with expertise? This is eminently socializable expertise.
Nobody has made a real case substantiating why the entire economy does not need to insure upwards to protect startups that don't understand how to secure a giant sack with a dollar sign on it.
There should definitely be a place for a company to hold $10M without risk. Maybe $20M.
That doesn’t mean that it needs to be the same place for a company to dump $3B.
My point is that there is a lot of room between the (previous?) $250k “limit”, and the apparently new “infinity” limit.
There is. It's called a T-bill. I know how to buy them, and I am not a hotshot startup CEO. I think it's okay to expect some level of maturity out of somebody handed That Kind Of Money.