The Silicon Valley Bank fallout is just beginning

The collapse of Silicon Valley Bank has prompted many startups and entrepreneurs to seek safe haven and invest their money in bigger banks such as JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo. Startups such as Brex, Mercury, and Meow have also benefited. However, some are hedging their bets by putting capital into multiple banks. The big banks are paying greater attention to clients who keep a lot of money in their accounts, causing concern for smaller, regional banks that could lose out in the situation. With the long-term outcomes of the situation unclear, there may be more caution in startups and more belt-tightening measures, including layoffs. There may also be a slowing of the interest rates that the Federal Reserve has been aggressively hiking. There is growing frustration among venture capitalists (VCs) regarding the bank’s collapse, which has sparked a blame game among them. There are also fears that Credit Suisse may also begin to look weak, potentially adding to the instability in the banking world.

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