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Can I ask why everybody banked with SVB? Are Wells Fargo or Bank of America not hip enough? A bank should be like a gas station, you go to the nearest one giv
by JumpinJack_Cash 4y ago
Can I ask why everybody banked with SVB?
Are Wells Fargo or Bank of America not hip enough?
A bank should be like a gas station, you go to the nearest one given that the pruduct being sold is essentially all the same.
I think that what happened is that founders weren't the one opening the accounts, the VC industry took it upon themselves to streamline the process in order to free the founders of the 'burden' of having to provide the documents etc. So it was the legal office of VCs doing the opening and they were opening with SVB because VC funds are incestous and they have zero geographic and ideologic diversification in their non-portfolio business relationships. So they all end up using the same law firms, banks, consultants etc. Same reason why they all sits on each other's boards.
- somewhereoutth 4y agoApparently being a startup, with large chunks of money being deposited and unclear/non-existent operating revenue on a dubious business proposition raises lots of red flags for mainstream banks.
- JumpinJack_Cash 4y agoI don't buy it, while it's true that startups are hundreds of thousands in the US, it's also true that VC funds are about 2000, the ones that invest on a recurrent basis must be less than 1000. Every big bank surely has the receipts by now and they can check the sender as well as the cause for the wire (which should always be added) . A 2.5M wire with sender being 'Founder Fund' and cause being 'Equity investment' will get the green flag even if the account is 3 months old or less.