Ask HN: Has your view of Silicon Valley changed in the last 72 hours? | Hacker News Reader

Ask HN: Has your view of Silicon Valley changed in the last 72 hours?

43 pointskoolko95 comments

Given the events over the past weekend, has your views on how SV is run on the business side changed?

Ben Thompson has a great take on this: https://stratechery.com/2023/the-death-of-silicon-valley-ban...

He makes the case that one factor of many in the success of SV was people played iterated games with the same people, which effectively built trust. Now the companies and stakes are so huge that it can be worth it to break that trust sometimes because the benefits of a single win (billions of dollars) can dwarf the downsides.

It’s an insight that makes sense to me and something I wouldn’t have considered otherwise.

Sadly enough, this makes a lot of sense to me and seems to be exactly what's happening.

How is the breakdown of trust a bad thing in this case? All that incestuous, unwarranted mutual trust and people helping each other only serves to shield the lazy and incompetent. What is that trust based on? It's based on nothing. For the most part, people in SV have no shared values aside from a desire to get rich at all costs (which is common, though maybe not universally shared). Such forms of trust should not exist. That kind of goal-oriented trust is the kind of trust you see in criminal organizations, not the kind of trust which drives a functioning society.

Relationships should be founded on shared values, not shared goals. Because once most members of the group have reached their goals, what's left to bind them to the rest of the group? Nothing. Of course they will (and should) throw the rest of the group under the bus as soon as they are able. It's not the same group which initially signed up for anyway, it changed.

Trust is shared values, not shared goals.

That's one interpretation but many people are incapable of separating the two so they have a different definition of trust. For example, if one has blackmail on someone else and both parties know it, the one who knows the dirt may feel that they 'trust' the other because of the fear that they instill in the other.

E.g. I may say that I trust my bank with my money but, in fact, I have no shared values with them. I only trust them to the extent that I know that their executives are well off and they don't want to go to jail. I assume that they will do everything they can within the law to screw me over though, so my trust is limited.

I’m sorry but if you think someone won’t harm you only because you have dirt on them, then neither of you really trust each other. Trust means you are confident that other person will not harm you regardless of what you have.

This is so blindingly accurate that it had to be downvoted. How telling.

Unless I am missing some important context, that paragraph makes no sense and gives no insight. What are the benefits of breaking a trust? Did someone make billions of dollars from the SVB collapse?

The article explains it with game theory.

In game theory, there's a big difference between a so-called "iterated prisoner's dilemma" and a one-shot prisoner's dilemma. Call these IPD and OPD.

Basically under the conditions of the past couple of decades, you could model Silicon Valley as an IPD. Under an IPD it always makes most sense to remain loyal.

But because of macroeconomic and technological changes (what author calls 'The End of the Beginning'), Silicon Valley models more like an OPD these days.

But under an OPD the winning strategy is to be self-interested.

Anyone who has noticed the shift from IPD to OPD ahead of their peers is able to make big bucks -- if only at the cost of their reputations. (But again, we don't care about 'next time', this is a one-shot, so reputations are now next to worthless.)

Specifically, with regard to SVB, depositors could have HODLed (if you will) as investors did for e.g. the run-up in GameStop.

The article insinuates that in the past, under historic/IPD conditions in Silicon Valley, they probably would have.

However, under contemporary conditions, OPD makes most sense, and most VCs, being savvy, sort of intuited this, and everyone tried to be the first out the door.

There's a broader point as well, alluded to near the end of the article -- that even more broadly speaking, our whole civ is edging closer to being best modelled as an OPD, which in turn pushes more systems towards collapse, and in doing so, invites more regulations, which in turn tamp down on growth.

So this article, if correct, comes with a gloomy forecast, and suggests that 'die fatten Jahre sind forbei' (the years of plenty are over) -- and not just for the Valley.

Great article. Prescient and uncomfortable.

No, and Im not sure why it would unless you are willing to paint broad swaths of people with the same brush. IMHO, there are still a bunch of ambitious and talented people. Most of them with good intentions, many of them smart, but all human.

To be honest, I didn't even see that many examples of bad behavior. Some bank managers took some big risks and an unlikely event blew up in their face. Some CEOs and VCs panicked, but I would too.

I dont particularly care for the account holder bailout, but I get it. Whisper "contagion" and people panic after 2008.

If anything, what I learned over the last 72 hours is how much resentment and bitterness has been brewing. It is a pretty amazing level of outrage for something with so little relevance for most people.

What shareholder bailout? If you’re referring to SVB, shareholders will be wiped out. Only depositors are being bailed out (/made whole).

typo, I meant account holder/depositor

Everyone knew FDIC limited to $250k an account. They put more in anyway and got bailed TF out. It's a bailout of depositors who didn't hedge risk among multiple accounts. Make no mistake, it's a bailout. I'd be more OK with it if regular citizens didn't get shafted at every opportunity but the wealthy always get a pass.

Steal a $2 bag of chips, get a year in jail. Take a stupid risk on overfunding your account over FDIC insurance, the taxpayers have your back, whether they want to or not.

It's garbage.

I have no idea what you’re commenting in response to, but the parent comment had a typo that said shareholder bailout, and regardless of your opinion as to whether this was a bailout for depositors or not, it most certainly wasn’t one for shareholders. That’s all I was saying.

I know, I wasn't fussing at you, I was just ranting in general. I've been in tech since I was a little kid in 1983, and it's all gone to pot, taken over by money men corrupting the hope that it once was.

I wonder whether part of the problem is that technology has a tendency to concentrate and amplify power. For instance, I wouldn't consider Mark Zuckerberg or Bill Gates or Larry Page (to name a few) money men... and these men all have very very large egos.

If depositors split $1 million across multiple accounts, then they would be made whole with FDIC insurance for each account. If they have the same $1 million in one account, they’re still being made whole for the same amount. There’s literally no difference in the amount of money being paid back to them in either scenario.

If they had split the $1m over 4 accounts and only 1 failed, there would be no need for a bailout. It's redundancy, something every tech person learns about pretty early on. It's hedging risk, something every finance person learns about pretty early on. It's basic, fundamental stuff in two disciplines.

Fine it's an error, take your medicine. My problem is when the average Joe makes an error, they get the full force of the justice system coming down on them. Walk around the area, you'll see a bunch of them living in tents.

It seems like Im missing something.

Is it accurate to say that you are mad the system, and not tech specifically? Afterall, VCs and tech workers aren't the ones locking people up. If anything, it seems like they are softer than average on crime. When I walk the streets in the bay area I see stolen cars and when I go shopping I see people flagrantly robbing stores.

I don't like the account holder bailout either, but in reality, it has much less impact on me. The other banks will pick up the tab and I will probably see another nickel or dime in fees on my checking account.

I don't know that "bailout" is quite an accurate description of what is happening. AFAIK it isn't as if the money was/is lost; it is more of a timing issue that is being bridged.

> regular citizens didn't get shafted at every opportunity but the wealthy always get a pass.

Not in this case in my view, but generally I would agree with you. Unfortunately, this is how power works... and I don't know that any society, bar perhaps an authoritarian one with a benevolent dictator (but that is destined to fail too over time), has solved it fully or even acceptably. If we think back to the French Revolution, I think as long as the populace is mostly happy, then the powerful are able to get away with things; it is when the population is more down and out that the pitchforks are sharpened and the torches readied with fire - so the powerful have to keep that in mind, always.

>I don't know that "bailout" is quite an accurate description of what is happening. AFAIK it isn't as if the money was/is lost; it is more of a timing issue that is being bridged.

Bridging that timing issue will cost a few billion dollars in real cash, and other banks are being fined to make up the difference.

I should've realized as I wrote that that there is a real cost (time == money). Do you know whether the other banks are being compelled? Or are they doing it willingly to shoulder their own kind?

They are being compelled.

>Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

I'm assuming it is all banks and the fine will be proportional to their size.

https://home.treasury.gov/news/press-releases/jy1337

This is basically how the 250k FDIC money is covered as well. All banks have to pay insurance fees to the FDIC, and when one goes belly up, the Federal Deposit Insurance Corporation pays out. The only difference is the 250k is prepaid

I may not be fully informed (please comment if that's the case), but it seems like there were really only a couple of instigating factors:

1) SVB invested too heavily in long-term bonds, which reduced their ability to maintain liquidity. In particular, with the inverted yield curve, the recent increase in interest rates seems to me to have made it more likely that these long-term bonds were going to be underwater either way

2) Peter Thiel (allegedly?) instigated a run on the bank by advising people to pull money, partially(?) due to reports that they lacked sufficient liquidity

I don't see the depositors being at fault here. In so far as the depositors had accounts in excess of the FDIC insured limits, first, it seems really difficult for companies to have a sufficient pool of liquid cash in an account somewhere such that they can pay payroll from it. Second, I have read accounts of startups being lent funds from SVB, but with the requirement that the funds be kept in SVB as well. SVB was the de facto choice, from how it sounds, so I don't blame the startups for going with what was a proven good solution... even if it was later proven not so good.

Also, it seems like the FDIC is doing the right thing. All of the insured funds are covered, and it seems like they're also covering all of the deposits in excess by liquidating the assets at a loss, which the bank's shareholders will eat.

Overall, it doesn't seem like a good situation, but we seem to have avoided a train wreck, at least from where I'm sitting. I may be missing things, and I don't have much experience in finance.

>Also, it seems like the FDIC is doing the right thing. All of the insured funds are covered, and it seems like they're also covering all of the deposits in excess by liquidating the assets at a loss, which the bank's shareholders will eat.

My understanding is that assets wont cover the deposits. The FDIC is making the entire banking system pick up the tab with what amounts to a fine on all banks. This will either come out of the profits at other banks or get passed on to account holders of those banks as higher fees/lower interest.

>Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

https://home.treasury.gov/news/press-releases/jy1337

You summed up my understanding and point of view perfectly.

There's a Silicon Valley I see on the news and Twitter that I've still never once seen in real life.

I moved to SF in 2008, and it was the most magical place on the planet. I met amazing people everywhere I went... smart, interesting people who just wanted to make cool things. I loved every second of it.

And it's still that way to me. And I say this as a person who's been to my share of fancy VC parties. Sure, things have changed a bit, but the greedy, out of touch caricature of SF I see online doesn't match what I see in person.

Even during the past 72 hours, I got dozens of texts and emails from people checking to see if my company was okay and asking if they could help. Everyone I know is genuine, hard-working, passionate, curious and kindhearted.

It's become clear the pervasive impression is that people in SV are rich, out of touch and barely work. Maybe that's true and I just don't know that version of SV. But I think the Musks of the world have won the perception game, and we're all going down with them.

I do not live or work in SV, but it's kind of interesting to me that this comment has no responses. Is that because what the parent states as being true is not actually the case, or is there some other reason why there are no responses to this comment? From my own experience with startups many moons ago (albeit on the East Coast, first Philadelphia and then New York) the parent comment rings true: it was my experience that startups totally helped each other out with (as examples) required documentation (e.g. regulatory stuff that's base-level, non-negotiable for specific spaces), tech-type things (e.g. you will probably encounter this question/problem, here's how we handled it) and other stuff too. Granted, this was in situations where the "helper" was not a direct competitor to the "helpee", but often they were at least in the same general market, otherwise the help being offered wouldn't even apply.

Edit: clarification

For starters, there's two SV's: the FAANG and "2nd tier FAANG" companies and the startups. Also, the ethos of SV has changed over the decades. What started off as "let's change the world" in the 60's and 70's has led to the "let's make lots of money" ethos we see today. Things may appear the same from the trenches but they've definitely changed at the top.

I lived there for 10 years and worked startups, not FAANG. Place after place, all run by people I’d never trust. Shady, dishonest, near criminals. Was happy to leave. I feel like Stanford basically produces criminals.

The issue isn't with the people, its with the products.

Outside ML, there has literally been zero innovation on the tech front in the past decade or so. We all got our internet phones, and the tech shifted into how to extract money from people (or sell people in the context of advertising) through these phones.

The main goal became to do whatever it takes to get users, then monetize the user base, then sell to/get acquired by some random company with lots of cash to burn to expand their portfolio with another item that generates revenue.

Then, after some time, monetization of the user base wasn't even a goal anymore. It was sufficient to just get users, which translated to companies valuation, which then translated into stock price that you can take to a bigger company and let them pay for additional development once they acquire the company.

Ive met (and interviewed) plenty of smart people from SV as well. Most of their experience is something web adjacent. They talk about setting up distributed systems, building pipelines, automating stuff, all for a product that is in the end ultimately worthless to society - the value is all generated through hypothetical stock price in terms of how much someone would pay for this in the future.

So these people all just pawn in the game perpetuated by the finance sector that only gives a fuck about a number. And they participate in it because of another number. We could all have much better lives if SV was about tech instead of numbers.

Pre-SVB: Silicon Valley is full of self-interested organizations and people building things that, at times, result in wider societal benefit.

Post-SVB: Same.

The world is full of self-interested organizations and people building things that, at times, result in wider societal benefit.

This is an American sentiment. Please look abroad.

Nobody anywhere would argue with "people do bad things", but people where I am would be puzzled if that was your only assessment.

We do things here for the betterment of society not just because it's "the right thing" morally, but because it's the right thing practically. It benefits _us_. We're part of society.

This kind of pragmatic morality is smeared as socialism by the USA, by the people who stand to lose their near total control of the country.

And P.S. we're all the same, there's nothing special about Europe. You can have this too, without losing your freedoms (which by the way, we also have!). And we also have bad people, it's just that we see them as the exceptions, not the norm.

Sounds like idealism to me. I think you'd have a hard time quantifying your perspective. It's not the only assessment. Just statistically likely that it's the majority.

> Sounds like idealism to me

I hear this a lot from Americans that haven't been here. But I'm talking about Europe _right now_, not some imaginary fairy tale land.

> I think you'd have a hard time quantifying your perspective

I can only talk of my own experiences of course, but the majority of Americans I've talked to who have stayed for more than a month (more than just a holiday) are amazed at how high the quality of life is here, and how friendly people are.

> It's not the only assessment. Just statistically likely that it's the majority.

Perhaps in America — and I'd believe it, I've visited a few times — but not here. Unfortunately, it's also a self-fulfilling prophecy; the more you believe it, the truer it becomes.

I didn’t say the quality of life was worse or equivalent to America. The improvements to quality of life in Europe are likely largely driven by government policy not for-profit organizations.

When do the citizens get a bailout?

It feels to me like the whole startup economy is essentially built on making regular people take enormous risks with their lives.

R&D used to be quite conservative and limited, true, but conducted by deep-pocketed companies or governments. Now people are encouraged to take the risks themselves, live a precarious life funding round to funding round, encouraged by a massive but distant carrot most people never even smell.

SVB feels like another part on this play. It reads to me like their business model barely made sense - but so what? It would pay while the music is playing, and if it fails, the bag holders are the same start-up hopefuls.

I totally think there is a niche for startups, and people who are well-suited to work there, but not at the levels we are seeing. Anyone who can hold a broom is told to set up an "Uber for cleaning" or whatever, and that's not a good idea.

No. I already thought SV has a greater than average concentration of irresponsible “move fast and break things” types. Eventually the adults adults will always have to take over to avoid a disaster.

We're talking about a 40 year old bank that bankrupted itself with a 1.5% 10-year mortgage backed security. I don't think "moving fast and breaking stuff" is what got us here.

I feel like the 10 year MBS investment might actually have been a case of excess risk. In a world of zero interest rates (which I presume is when they invested in the MBS), 1.5%-2% yield makes SVB quite a bit of extra profit.

Their investment may have been a case of greed and poorly controlled risk.

Go back to 2021 before rates go up and tell me what you’d do. Kinda damned either way. The bank had to make profit to survive btw. They dont pay for their services on good will.

Most other banks found ways to survive the environment in 2021. So clearly there are ways to do it without locking money up for 10 years in MBS.

Most other banks didn't see the incredible growth SVB did, either.

I understand that they needed to put the money to work somewhere, but they really chose a bad way to do it. Hence the 'poorly controlled risk' that I mentioned.

I think it was quite fair to think they could have sold 10 year treasuries at cost at least. An invert yield curve for this long is not normal. But yes maybe they should have laddered better.

>An invert yield curve for this long is not normal.

Risk management at financial institutions isnt meant to be an exercise of expecting or planning for the normal. Any way we slice it, they failed to adequately assess risk.

You understand that’s the silliness of risk management. Anyone who failed is always accused of not managing it. It’s a truism.

You can’t prepare for all outcomes and this was not one a bank expects. A 3 day 40 billion dollar draw down maybe a first ever event for any bank in all of history. Should they also have risk managed for a nuclear bomb going off in their lobby?

Get real man. Recognize that you are Monday morning quarterbacking here.

Just gonna Google some stuff and read some articles and put important facts and sources here to try to answer the burning question I have: Why did they choose to realize that loss now?

> Last week, depositors started pulling out their money and to meet that demand, the bank had to sell its investment in bonds whose value had declined due to rising interest rates.

> SVB Bank had last week sold its $21-billion bond portfolio consisting of US Treasuries and mortgage-backed securities at a loss of $1.8 billion.

> Over 95 percent of these mortgage-backed securities were over 10 years in duration, with a weighted average yield of 1.56 per cent.

> The bank had invested heavily in Mortgage-backed securities and US Treasuries last year through deposit money to earn higher returns. The bank had seen a huge influx of deposits but struggled to find enough credit demand to deploy that money at desired yields.

> As per reports, SVB had over $80 billion worth of investments in mortgage-backed securities.

https://www.moneycontrol.com/news/business/mc-explains-what-...

> Investors and depositors tried to pull $42 billion from Silicon Valley Bank on Thursday in one of the biggest US bank runs in more than a decade, according to a Friday regulatory filing.

> At the close of business on March 9, the bank had a negative cash balance of $958 million, according to an order taking possession of the bank filed Friday by California’s bank regulator, the Department of Financial Protection and Innovation.

> The scale of attempted withdrawals was so large that the bank ran out of cash and ways to get it.

https://webcache.googleusercontent.com/search?q=cache:O_auqz...

> The run was sparked by a letter that Silicon Valley Bank Chief Executive Officer Greg Becker sent to shareholders Wednesday. The bank had suffered a $1.8 billion loss on the sale of US treasuries and mortgage-backed securities and outlined a plan to raise $2.25 billion of capital to shore up its finances.

> But the root of its demise goes back several years. Like many other banks, SVB ploughed billions into US government bonds during the era of near-zero interest rates.

> When interest rates rise, bond prices fall, so the jump in rates eroded the value of SVB’s bond portfolio. The portfolio was yielding an average 1.79% return last week, far below the 10-year Treasury yield of around 3.9%, Reuters reported.

https://www.cnn.com/2023/03/13/investing/silicon-valley-bank....

I think that a lot of societal ills can be chalked up to "low interest rate phenomena." Silicon Valley has had a decade to play with free money. What do they have to show for it? Smartphone CRUD apps, subsidized gig workers, influencers and child consumers. Let's keep raising interest rates.

The last 72 hours validate the view that Silicon Valley isn’t capable of taking leadership in fixing the problems it creates, and that we’ll have to rely on Washington to set the rules.

Washington set faulty rules in the first place. Since when was it logical to lend out money that wasn't yours?

I didn’t say that Washington setting the rules was a good thing — but who else will step in where there has been a complete vacuum of any leadership in Silicon Valley in the last few days?

What kind of leadership were you expecting?

The rules didn't change recently, the rules just got executed as planned, which prescribed the FDIC takeover.

The rules also stated that FDIC insures amounts up to 250k$. This rule changed in a big way over the week-end.

> Since when was it logical to lend out money that wasn't yours?

Since the idea of banks began as long ago as 1,800 BC in Babylon.

Yes. I learned that the VC industry, at the company management level and even at the venture capital management level, had a very poor understanding of banking. Some crazy percentage of VCs used one particular small regional bank for their funds, they told their portfolio companies to do the same, and everyone even banked their personal accounts with the same bank. Somehow, an entire industry was unaware that you need to manage and diversify counterparty credit risk - even when you are dealing with banks. It's amazing to me that this could happen. I can understand why startup founders might not be aware of banking risks, since banking is not expected to be their expertise and they might have been children the last time a major bank went under. But how did the VCs miss this? This would have been the equivalent of a nuclear detonation in their industry, had the government not bailed them out. I guess we could charitably think of this as part of the process of the VC industry maturing and become a larger part of the economy. Now they'll hopefully better diversify their banking relationships, and the banking industry and regulators also got a much needed shot in the arm regarding the obvious uselessness of the "250k FDIC insurance" backstop during even a minor banking crisis.

Pre-SVB: SV was full of some really smart people, many of whom didn't realize their skills and experience don't translate to other areas (eg pretty much anything to do with crypto) combined with some salesmen, some of whom are snake oil salesmen. Together they are more and more resembling the rest of Corporate America with performative cultures, privatizing their own luck, often having unearned bravado and increasingly perverting government to rig the game.

Post-SVB: Not much has changed.

There is a ton of misunderstanding about SVB. Some think we're bailing out billionaires. We're not. There's a lot you can criticize the governemnt for. This isn't one of those situations. SVB didn't manage its risk and fell out of compliance with its debt ratios. The government stepped in, dissolved the bank, paid out the depositors and the shareholders are at the back of the line. And it cost the taxpayers nothing.

I've long been convinced Peter Thiel is awful in pretty much every way. I hope this gets investigated because there's a reasonable suspicion that Thiel created a run on SVB, either intentionally or just accidentally. Why? Who knows.

You're basically also describing HN but yeah lots of overlap for obvious reasons.

"Cost the taxpayers nothing" - well not in "taxes", but I'm not sure we can really say nothing. Clearly the banks paying for it won't just eat that cost.

SVB had more assets than depositor liabilities. IIRC the last estimate I saw claimed there was ~$30B in excess assets to depositor liabilities.

The problem that SVB faced was falling out of compliance with debt ratios. The modern banking system works on fractional reserves. The US requires IIRC 10%. A run of withdrawals still meant they were asset positive but didn't have enough cash on hand. That's what forced the sale of their liquid assets at a discount.

So, no, this probably won't cost the taxpayers anything, directly or indirectly.

SVB was not the only bank involved and was at a $25B deficit (from the latest I have heard) due to the fact it was having to sell those bonds at a loss to try and provide liquidity to depositors. Also, that completely ignores the time value of money. Even if those bonds will be worth enough at maturity, holding money for 10 years isn't free. They are getting 1.5%, but the risk free rate is much higher than that atm.

Anyone who knows a thing or two about history would know that boom and bust is baked into SVs DNA. People were asking the same questions 20 years ago when the dot-com bubble went bust.

Pre-SVB Peter Thiel: True example of the best of the hacker mindset!

Post-SVB Peter Thiel: Dark and selfish example of the worst of the hacker mindset.

He's been doing his best to make this clear for 20+ years.

Yes, the panic was pretty crazy. I realized that much of these people are actually anxious, insecure personalities who are scared of losing their significance.

The petition here on HN sealed that view.

Nope. Been here for a couple cycles. As #6 says, "All of this has happened before. All of this will happen again."

The weirdest part is how many people think depositors should actually take a haircut, or that is should be on the depositor to prove the financials of their chosen bank for bankruptcy risk.

Not really a view of Silicon Valley though, unless people making said comments are from Silicon Valley.

How bank runs were historically handled in the US is that the depositors lost all of their money. Banks runs are a recurring problem that have a history going back hundreds of years. That's changing now though, the SVB depositors will be made whole by the government in order to avoid a wider banking crisis and what that means for everyone else is TBD but it looks like some form of insurance that's better than $250k.

"Historically" meaning "before the FDIC"; that is, before 1933.

Post FDIC, bank runs were historically handled by the FDIC either merging the bank with a solvent one, or taking it over. Depositors below a certain amount lost exactly $0, amounts above that were at risk. That amount was currently at $250,000.

What's new is that depositors above the threshold have been made whole.

I always suspected SV was full of awful, selfish, classist hypocrites. But now I have it confirmed.

Hopeful: maybe a chapter has closed in terms of the shenanigans from recent years like "crypto" and not-very-meaningful "disruption". Tech is good when it's building cool things that end up making the world better, not BS stuff.

Nope! But I’ve been around for a little bit. Welcome to the other side of the mirror, folks.

No, it’s wrong for people to lose their money when it’s in the bank. Deposits should be better protected and maybe banks need more regulations to prevent this sort of thing. I don’t know the solution but we need innovative banks like SVB.

My friends shared their disappointment over the fact that Silicon Valley Bank (SVB) will no longer be an option for their small startup businesses. They had positive experiences with SVB, finding them supportive when needed, and non-predatory on fees. Additionally, they were impressed with SVB's recent improvements to their online banking and app. One of them is now faced with finding a new bank that can understand small startup cash flows and provide helpful connections. They expressed feeling a bit bummed about the situation.

Nah. The days of SV innovation were mostly a meme at this point, and the collapse of SVB simply puts a fine point on it:

Big corporate rules all, sees all, owns all.

Kinda like NYC screw-you-pay-me but with a faux niceness.

Not at all. if my money in svb.. would have ran to pull it out.

too many armchair expert not understand issue effect people who not gamble money but victim of just having deposit.

main issue bankers did not hedge risk of inflation. why helping start ups survive losing all they cash is going to change my mind?

and this country waste tens of billions on bloated bureaucracy government. but a dime to people who will do innovation is bad? disagree

Silicon Valley has always been boom/bust like Florida Real Estate. Remote working is the bigger threat this time, why come back in SV?

No. Bank insolvency follows irresponsible cadres where trust does not bind, but rather, greed. SV is full of some of the greediest folks masquerading under the hip pretense of tech leadership. If anything, this brings me hope that SV will have to face the music and build real trust, something that involves the class they exploit, the users.

SVB on its own? Not much. But SVB coupled with the layoffs is making me feel very uneasy about the tech sector.

I know tech's seen bad days before (e.g. the dotcom bubble), but that was before I got into the industry. All these bad headlines are definitely making me worry about my own prospects for sure.

no. VCs primarily fund stupid ideas and make choices based on emotion and ego and not common sense. they also have strong ideas about where markets and trends are going which are at best based on analyst reports and cocktail reception chatter. so the end result is always disappointment. occasionally they gambled right. what should happen is that they should fund a wider variety of businesses in more markets and not just focus on one specific type of startup.

Not sure if “changed”, but I feel like a lot of what happened was nit really warranted and more of a self-fulfilling prophecy unfortunately. Just stay calm and keep on creating real value.

Nope. Finance in search for trends and potential trends in search of finance breeds systems of conformity in a race condition based on bad feedback mechanisms.

Nope. If you look at the whole cycle going back to Shockley nothing seems too odd to me, yet anyway - I'm still open to changing dynamics.

If you go back and read books like Hackers[0] or The Soul of The New Machine[1] even the cast of characters is weirdly similar. That piece of geography seems to really strongly attract both the Founder and Venture Capitalist personality, who really are misfits most other places.

I suspect the chaos of the last few days is healthy for the system overall because it makes it look risky and possibly not even a payoff. That's not the way it looked 3 years ago.

As a result I suspect people who hang around will build even cooler stuff than we've seen in the previous 3 years.

[0] https://www.amazon.com/Hackers-Computer-Revolution-Steven-Le...

[1] https://www.amazon.com/Soul-New-Machine-Tracy-Kidder/dp/0316...

I have more confidence than ever that silicon valley won't destroy humanity :)

only in the sense that they were incrementally confirmed/validated

Why is SV different than anywhere else with regards to recent events?

No, SV has always been Gomorrah, vs. SF's Sodom.

California is a vast cesspool.

Like the titans of Atlas Shrugged, they showed how willing they were to burn it all down for everyone else in order to win.

Well played.

The "titans" you speak of are Jerome Powell, and Janet Yellen. Not the schmucks that put Taxis on the internet, or effectively stole billions of dollars from SoftBank to build a rental company. These types of extremely competent people are far and few between in important parts of our society. So idk what the fuck you're talking about Yosemite? (from NewsRoom Intro https://www.youtube.com/watch?v=wTjMqda19wk&ab_channel=tprat...).

Good friends to have. It's a big club, and you ain't in it.

David Sacks took care oh him and made him whole.

No lmao

Imho it'll take very slowly for it, as the impacts are really distributed across the entire country: accelerated its inflation and hyperinflation

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