It turns out burn reduction at startups is more aspiration than reality
It’s not every day that banking news is the big story in the startup world, but here we are. Yesterday the previously crypto-friendly Silvergate Bank announced that it would “wind down operations and voluntarily liquidate” itself.
The company’s stock had been under massive pressure in recent months, exacerbated by a note from the bank on March 1 that its earnings data would be delayed due to possible internal controls issues. It was also under regulatory inquiry.
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But that’s not the new big banking news making waves in startup circles.
Silicon Valley Bank (SVB), a well-known institution in the technology industry that works with venture capital firms and startups alike, announced that it was raising capital via a share sale (among other mechanisms), taking a $1.8 billion charge to divest itself of low-yield assets and double its term borrowing.
