The public has an interest in enabling high risk ventures, BUT, this must happen through a well designed mechanism that sustains itself. Like how I explained in

The public has an interest in enabling high risk ventures, BUT, this must happen through a well designed mechanism that sustains itself. Like how I explained in my comment later: Through the taxes levied for that reason, through insurance fees charged to fund that mechanism and so on. But none of these apply in this case. High risk decisions were made by all of these actors, including most of the depositors, while privatizing all the profits. The very CEO of the bank is a libertarian and he publicly advocates that government should disappear. All the depositors are either part of the VC crowd, or startups that are practically controlled by those VC crowd. And most of the money (ironically) still belongs to that actual VC crowd indirectly because those VCs control the startups that they gave those funds to. So basically it was all privatized profits until the risky decisions came home and suddenly a need for socializing the losses came to being, causing even the die hard libertarian CEO of SVB to start publicly demanding that the govt. should bail them out, in a public display of total lack of principles. (then again Ayn Rand did the same). Yes, the depositors were also risk takers. They took the risk of trusting that high-risk bank that lobbied for watering down regulations for more profit. They took the risk of trusting the VCs who forced them to put their money in that bank. Non startup/VC related clients took the risk of putting their money in that bank for reasons ranging from higher gains to groupthink. Those were decisions taken by them. The public cannot be expected to save them from the consequences of that risk taking without getting back its money's worth. And no - the return cannot be 'a more lively startup ecosystem'. The expected return can only be money. That the public so desperately needs for repairing the society.