4 ms·
SVB made loans to cash-rich companies approximate to their funding rounds, when they were least likely to immediately use the cash. These loans typically requir
by noitanigami 4y ago
SVB made loans to cash-rich companies approximate to their funding rounds, when they were least likely to immediately use the cash. These loans typically required the company to hold the money as a deposit in SVB. These deposits were used to buy long duration bonds.
In other words, SVB used these companies to produce new money that they could earn interest on.
- ajross 4y agoYeah, that's the kind of thing I'm imagining. Though it doesn't explain the VC tweetpanic unless they were getting kickbacks. Is there a cite for that, or a story posted somewhere?
- noitanigami 4y agohttps://twitter.com/jonwu_/status/1634250770555219970 https://twitter.com/jonwu_/status/1634250770555219970