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Silicon Valley Bank (SVB) is a financial institution over forty years old. It has been one of the backbones of startup funding in Silicon Valley, having funded or been part of funding more than 30,000 startups in Silicon Valley. At its peak, in 2016, it was the biggest bank in Silicon Valley-based on deposits, with a 25.9% market share.
Before its collapse, SVB had total assets of around $211 billion. In addition, the bank has stated that nearly half of the venture-backed startups in the US have worked with SVB, with estimates ranging from 44% to 48% of US startups tied to SVB.
What happened to the bank?
On March 9, 2023, SVB shares plunged more than 60% in value. The reason for this plunge happened the day before, March 8, when the company announced, via a filing, that it had sold $21 billion in assets. Plus, SVB also planned to sell stock.
After these announcements, panic set in, and people began selling off their SVB shares, with the value having another 66% drop in pre-market trading on March 10, 2023. It got so bad that trading was halted until further notice.
That same day, March 10, 2023, the California Department of Financial Protection and Innovation (DFPI) shut down the bank. Immediately afterward, this same state regulator…
