All the Companies Facing Major Troubles After Silicon Valley Bank Crash
As a result of Silicon Valley Bank’s (SVB) sudden implosion on Friday, a bevy of companies have started releasing filing information, sending out calls for help, and putting holds on their company’s payroll systems. Roku, Vox Media, and Etsy are among them.
The Federal Deposit Insurance Corporation (FDIC) seized SVB’s $209 billion in assets on Friday, ordering the bank closed after the crash. SVB is the 16th-largest bank in the country, and this crash has become the biggest bank failure since the 2008 financial crisis. SVB, which was formed in 1983, was used by a handful of startups.
“All insured depositors will have full access to their insured deposits no later than Monday morning, March 13, 2023,” the FDIC said in a statement. “The FDIC will pay uninsured depositors an advance dividend within the next week.”
Insured deposits include anything under $250,000. However, a handful of companies had millions—and some had billions—invested in the company.
Below is a round-up of companies which have reported an impact on their finances as a result of the SVB crash.
In a filing, Roku reports that SVB held roughly $487 million of the company’s cash. Roku, which sells streaming devices and releases original content, has around $1.9 billion, which means SVB held about 26 percent of the company’s assets. “The Company’s deposits with SVB are largely uninsured. At this time, the company does not know to what extent the company will be able to recover its cash on deposit at SVB,” Roku wrote in a filing.
Vox Media, the publisher of New York magazine, The Verge, and Group Nine Media, reportedly had a “substantial” amount of funds held in SVB, a person close with the matter told The New York Times. The company credit cards, which SVB issues, also reportedly stopped working. Vox has reportedly said the company won’t face “any disruption,” which includes its payroll. Penske Media, which recently placed a reported $100 million investment in Vox, says it is “ready if the company required additional capital” but “didn’t foresee any issues.”
Merchants on Etsy have started receiving communications from the e-commerce company that they won’t be receiving scheduled deposits. “This delay was caused by the recent developments regarding Silicon Valley Bank,” the emails to sellers read, “who Etsy uses to facilitate disbursement to some sellers. We are working with our other payment partners to issue your deposit as soon as possible.”
On Saturday, an Etsy spokesperson told The Daily Beast, “At Etsy, supporting our sellers is our highest priority, and we understand how important it is for these small businesses to be able to receive their funds when they need them. We recently experienced a delay in issuing payments to some sellers related to the unexpected collapse of Silicon Valley Bank. Our teams have been working around the clock to implement a solution, and we expect to pay sellers via our other payment partners within the next several business days.”
Well, this is just great.
If you, like me, run a business that sells on Etsy, you may not see a deposit if you have them set to pay out daily because of the Silicon Valley Bank crash.
Really regret buying so many groceries today 🤡 pic.twitter.com/WTEYDDrY6e
— Maridah (@maridahdotcom) March 11, 2023
Online game platform Roblox held 5 percent of its $3 billion with SVB, the company said in a filing—which equates to roughly $150 million. The video company said SVB’s collapse will “have no impact” on usual operations.
Cryptocurrency firm Circle had a massive $3.3 billion invested with SVB, the company revealed in a tweet. That’s around 8 percent of the company’s total $40 billion, which is held elsewhere.
1/ Following the confirmation at the end of today that the wires initiated on Thursday to remove balances were not yet processed, $3.3 billion of the ~$40 billion of USDC reserves remain at SVB.
— Circle (@circle) March 11, 2023
“Like other customers and depositors who relied on SVB for banking services, Circle joins calls for continuity of this important bank in the U.S. economy and will follow guidance provided by the state and Federal regulators,” Circle wrote in another tweet.
Camp, a start-up selling themed experiences and toys for children, sounded the alarm on its social media pages and website after the SVB crash. The company currently has a sale “related to SVB’s collapse,” since it “had most of our company’s cash assets” held with the bank, according to CNN. Camp has been posting memes highlighting the sale, writing “our bank got shut down by regulars, so we’re asking that you RUN, don’t walk to our BANKRUN sale.” Co-founder Ben Kaufman said that as a result of the sale, there’s been an “outpouring of customer support which will hopefully see us through,” per Fox Business.
D.C.-based Compass Coffee has faced an impact in payroll, according to an email from CEO Michael Haft seen by Fox Business. The coffee company was “severely impacted” by the collapse, though it is hopeful employees will receive payments over the weekend, Monday at the latest.
Slumberkins, a company that makes toys and educational material for children, shared a statement on Instagram that it had been “turned upside down” after the SBV collapse. The business, which has also worked to produce series with Apple TV+, said “a majority of the company’s cash” was held with SVB.
“The cash held there was our capital that enabled us to operate the business, continue to launch new collections and content, and develop the tools and resources that are being loved by so many children, families, and schools,” Slumberkins wrote. “It is unclear when, or if, we will be able to access the majority of this cash going forward.”
Rocket Lab USA
Aerospace manufacturer Rocket Lab USA held a good amount of its cash with SVB. The space company held $38 million, or 7.9 percent of its total cash, with SVB, per a filing.
Ambarella, a semiconductor company that focuses on AI camera products, took a hit from the SBV crash. The firm held deposits of approximately $17 million in total value, which is around 8 percent of its total $206.9 million reported at the end of January.
Biotech company Oncorus faces the loss of some of its funds as a result of the SVB crash. The company held about 23 percent of its total current cash, cash equivalents, and short-term investments in the bank, which is a total of $10 million, according to Fast Company.
Another biotech company, Sangamo Therapeutics, had approximately $34.4 million in deposits at SVB, Fast Company reports. The pharmaceutical company offers technologies in gene therapy, cell therapy, and more.
Yet another pharmaceutical firm, Eiger Biopharmaceuticals, faces issues after the SVB crash, Fast Company reports. Eiger reported cash deposits of around $8.3 million with the bank, around 7 percent of its total cash and cash equivalents.
Entertainment production payroll company Wrapbook was affected by the collapse of SVB. In a statement made to Twitter, the company said that the crash would cause payroll to be delayed and would impact the processing of checks.
Silicon Valley Bank, the 16th largest bank in the USA, collapsed earlier today and its $175B in deposits are now under control of the Federal Deposit Insurance Corporation (FDIC).
— Wrapbook (@wrapbook) March 11, 2023
“We’ve sent email communications to all companies and their workers—and will continue to operate transparently as this issue is resolved,” the company shared. “A bank failing is an extreme external event. We apologize, on behalf of all of us at Wrapbook, for any challenge this puts on you.”
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