Silicon Valley banks sink, Indian startups swim

- SVB has invested in as many as 21 startup companies in India, creating an ecosystem called SVB Startup Specialist

- SVB's top clients include India's IT unicorns and Software as a Service (SaaS). Smaller technical firms and venture capital backed by America's Silicon Valley Bank

- However, the rise of Silicon Valley Bank has alerted India's startup sector. The people of this area were united and discussed what to do if such a situation arose

When Silicon Valley Bank (SVB) took over, it was an indirect blow to India's startup funding system. Economic experts in India likened it to a Lehman moment. The money of many companies was blocked. Before there was more panic in India's startup sector, everyone was messaged that your money is safe so don't make too much noise. But it happened. The Federal Deposit Insurance Corporation (FIDC) assured that the payment will be received from the next week. FIDC said that all the deposits associated with the startup have been shifted to other banks. The Silicon Valley bank-based startup was not particularly shocked. SVB's top clients include India's IT unicorns and Software as a Service (SaaS).

Many Indian startups are associated with Silicon Valley Bank, which was established in California in 1983. Small technical firms and venture capital were backed by America's Silicon Valley Bank. However, the rise of Silicon Valley Bank has alerted India's startup sector. The people of this area were united and discussed what to do if such a situation arose.

Generally, when banks go bust or overnight, business account holders are seen to be more buoyant. In the case of Silicon Valley Bank, the startup's business account holders were also stuck.

When about 950 (SaaS) SaaS leaders met, each advocated more than one bank account. SVB is the 16th largest bank in the US and has the most deposits in Silicon Valley. SVB has investments in 21 startup companies in India.

For the last 40 years, Silicon Valley Bank has been associated with startup or venture capital and an eco system was created that was called specialist for startups. That is why almost 50 percent of Silicon Valley companies joined this bank.

Minister of State for Electronics and Information Technology Rajiv Chandrasekhar held a meeting with around 450 members associated with start-ups, venture capital and investors and assured that a list of their suggestions would be conveyed to the Finance Minister on behalf of the startup companies.

The startup's money is safe because of SVB, but it is natural that startups find it difficult to operate when the lending bank defaults. Due to which there will be a need to cut costs. Biden administration helps Silicon Valley.

As Silicon Valley banks go bankrupt, the Biden administration has contacted the Federal Deposit System to immediately announce that startup companies' money is safe. The order was announced and finance agencies involved in startups and cryptocurrencies were relieved.

Startup companies are now turning to frugality. For austerity, the job cut plan will be adopted first and then the salaries will be reduced. But overall India's startup sector has been immune to the effects of the troubles at American banks. Because so many small businesses are locked out by one bank. Because either their money is sinking or their financial transactions are sinking.

Economic experts are studying why startups in India have been affected. It can be said that it is a matter of happiness that the business does not break, but some people in India are worried about the fact that despite the failure of a big startup-friendly bank like Silicon Valley, why is the start-up similar to the business of India not affected?

The success of India's startup sector is also being discussed abroad. Silicon Valley IT companies have also seen India's success. The fact is that the Biden government has favored Indian startups. The Indian government resented America's crypto currency, but the Biden administration supported the startup system.

India's startup sector has opened a new window for those who want to venture into business. In addition to traditional business, there is a need to advance efforts to make people's lives more prosperous by using new digital technologies.

The government can provide opportunities for new industries to grow if they think so. Many areas are yet to be explored. There is a need to identify such sectors and involve entrepreneurs in them.

- Current without address in America

A bank account is opened

It is also worth understanding how Silicon Valley Bank continues to promote startups. Bank account is not opened in India without any bank document or proof like Aadhaar card. Among them, those who open a current bank account for business are pushed by asking for unnecessary documents like rent slip along with their office address. Light bill, tax bill, etc. are called for address proof even if Aadhaar card is available, but Silicon Valley Bank of America opens a current account even if any startup does not have a social security number or an American address, so that American and national investors can be dealt with. Who will convince banks in India that startups can be promoted in this way? Which can be included in ease of doing business.