The startup funding environment was already challenged. That was before Silicon Valley’s favorite bank, and a central artery for financing the startup ecosystem, collapsed. Considering so many startups and venture capital firms have financial ties to or banked with Silicon Valley Bank (or still bank with the bridge bank), could its troubles impact the fundraising space?
“I think there's no sugarcoating it,” this “has made the environment worse,” Pete Flint, general partner at seed-stage VC firm NFX, which banks with SVB, told me. He said that from their perspective over the last 10 days or so, it’s felt like the “psychology has snapped back,” but he argues there’s a belief in the VC community that the cause of SVB’s woes—largely rapidly rising interest rates, as well as woeful mismanagement—is “probably going to pop up somewhere else.”
