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What the Silicon Valley Bank collapse means for science start-ups

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2023-03-17 15:30:12

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The collapse of Silicon Valley Bank (SVB) late on 10 March sent science and technology start-up companies into chaos, and has left many questioning where investment will come from in future.

Regulators closed the bank after several days of turmoil following an announcement that it needed to raise US$2 billion to cover debts due to rising interest rates. This led to a run on the bank as several large venture-capital firms advised their clients to withdraw funds.

SVB was known for funding technology start-ups. Its location in Silicon Valley, a region in the San Francisco Bay Area of northern California, meant that many of these were green-energy or biotech companies.

The situation after the collapse was “absolutely terrifying”, says Ethan Cohen-Cole, chief executive of Capture6, a clean-technology start-up in Berkeley, California, that is developing ways of capturing carbon dioxide directly from the air . “Your first thought is: ‘This is the end of your company.’”