Startups Asked For Help Making Payroll After SVB. VC Responses Were Mixed

Startup founders who banked with SVB found themselves asking investors for help making payroll last weekend—to a mixed response.

Last Friday afternoon, OpenAI CEO Sam Altman issued a challenge to Silicon Valley’s venture capitalists: Put your money where your mouth is. “Investors who ask ‘how can I be helpful’: today is a good day to offer emergency cash to your startups that need it for payroll or whatever,” Altman tweeted. “No docs, no terms, just send money.”

In the wake of Silicon Valley Bank’s abrupt closure that morning, Altman’s message struck at the big question for tech entrepreneurs and investors alike: With deposits at SVB frozen, how would they pay employees the following week?

Over that frantic weekend, venture capital firms scrambled to respond to the crisis. Some found creative ways to ensure their founders would have access to cash on Monday, at times offering up their partners’ personal funds. More set up contingencies to make loans if necessary, then hoped it would never come to that. Still others chose not to make such an offer, or failed to reach a consensus at all.

The moment mostly passed quickly; the FDIC announced it would protect all SVB deposits by Sunday night, meaning that by Monday morning, much of the situation’s urgency—and need for VC firms to back up their promises—had passed. But a few still did wire funds. The founders involved in the crisis won’t forget who stepped up, and who floundered at a crucial moment.

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