Today we announced new data collected from startup founders on the SVB collapse. The goal of the data was to highlight the effect on the banking crisis on the startup ecosystem and how it will change the way they do business going forward.
The insights are based on data collected March 12th and 13th from over 100 startup founders across the globe, located in North America, Europe and Israel.
The survey was done by Startup Snapshot in partnership with Intel Ignite, Zell Entrepreneurship Program and Consiglieri
Despite having witnessed through the 2008 financial crisis and the collapse of Lehman Brothers, the overwhelming majority of founders did not see this crisis coming at all. When asked if they ever had a fleeting thought that SVB was vulnerable, 43% of founders answered “never” and an additional 40% responded “not really”.
When asked whether they think SVB bankers knew the risk they were facing, 71% of founders have some doubts that those on the inside were in the know.
The shift in preference to larger dominant banks can be seen by both startups that have been affected by the SVB collapse and those that have not.
Naturally, those that have been affected by the SVB situation are more likely to move their funds, with 53% reporting that they will definitely move to their banking relationship to a more dominant player and 32% reporting that they will potentially move.
Despite not having been personally affected, the breach in trust across the market is strong, with 61% of founders considering to move their banking relationship to those that they view as more “stable” players. 27% state that they will definitely move their accounts to a more dominant bank and 34% stating that they will potentially move.