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Silicon Valley Bank collapse hits tech world |
The bank, which catered to the startup and venture capital-funded tech world, effectively shut down Friday sending shockwaves across the tech industry. |
The Federal Deposit Insurance Corporation (FDIC) created a National Bank of Santa Clara to hold deposits and other assets of the failed Silicon Valley Bank (SVB), but the abrupt closing is impacting tech firms even with immediate tasks like ensuring employees get paid. Wedbush Analyst Dan Ives called it a "nightmare situation." "This will have a massive ripple impact across the tech ecosystem and Silicon Valley private company artery. SVB is a foundational piece of the tech startup community and will have a constrained impact on funding for tech startups going forward," Ives said in an email. Silicon Valley Bank's clients included brands such as Shopify, ZipRecruiter, Pinterest and venture capital firm Andreessen Horowitz, among others. Even businesses that aren't clients are getting impacted by the closure, especially with the most immediate impact on delaying payrolls. Parker Conrad, CEO of Rippling, a payroll processor that used Silicon Valley Bank, said there would be payment delays of pay runs initiated earlier this week. The company is focused on "getting these employees paid as quickly as possible," he said in a Twitter thread. Going forward, Rippling will use JPMorgan Chase & Co. Silicon Valley Bank was hit hard by the series of interest rate hikes by the Federal Reserve. It's the latest way the rising interest rates have hit the tech sector — following the mass layoffs at tech firms including giants such as Meta, Amazon and Google. Read more on the bank's collapse in our full report at TheHill.com. |
Welcome to The Hill's Technology newsletter, we're Rebecca Klar and Ines Kagubare — tracking the latest moves from Capitol Hill to Silicon Valley. |
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How policy will be impacting the tech sector now and in the future: |
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The widely popular social media app TikTok has hired its own consulting firm, SKDK, as it comes under new scrutiny from lawmakers worried it is a security threat, according to a report in Politico. SKDK was hired to provide its support to TikTok as lawmakers push bipartisan legislation that could ban or restrict the app. The firm’s ties to the Biden administration are notable. Anita Dunn, one of the firm’s … |
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| (KDVR) — Have you ever received an email saying one of your accounts has been compromised and you need to update your security information? You’re not alone. Scam alert: Can you stop those fake texts? “With hacking becoming increasingly sophisticated, regular users are bearing the brunt of it. Certain social media accounts are especially vulnerable to cyberattacks,” Deyan Georgiev of VPN Central said. What … |
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A judge has rejected a request from Google to transfer a federal antitrust lawsuit against it from Virginia to New York. The ruling Friday from U.S. District Judge Leonie Brinkema in Alexandria, Virginia, is a victory for the Justice Department and several states, including Virginia, that sued Google earlier this year and wanted to keep the case in the commonwealth. |
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News we've flagged from the intersection of tech and other topics: |
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China steps up as top tech supplier for Russia following economic sanctions |
China and other countries like Turkey have become top suppliers of tech products to Russia following economic sanctions imposed by the U.S. and other allies, The Wall Street Journal reports. |
Best Buy, Roku unveil advertising partnership |
Streaming platform Roku announced Friday it is partnering with Best Buy to get access to its advertising platform. Best Buy will also give its customers exclusive access to Roku-branded TVs. |
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Upcoming news themes and events we're watching: |
- The Council on Foreign Relations will host an event on cyber diplomacy on Tuesday at 12 p.m. ET
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Driving the future of EV sustainable transportation |
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Branch out with other reads on The Hill: |
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A federal judge has rejected former Theranos executive Ramesh "Sunny" Balwani's bid to remain free while he appeals his conviction for crimes he committed during a blood-testing scam he orchestrated with his former boss and lover, Elizabeth Holmes. The 17-page ruling issued late Thursday pushes Balwani, … |
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Two key stories on The Hill right now: |
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Rep. Eric Swalwell (D-Calif.) slammed Rep. Jim Jordan (R-Ohio) at a Judiciary subcommittee hearing on Thursday about "compliance with committee oversight," … Read more |
| Rep. Lauren Boebert (R-Colo.) is announcing that she'll soon be "a 36-year-old grandmother," while praising "rural conservative communities" that "value … Read more |
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Opinions related to tech submitted to The Hill: |
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You're all caught up. See you next week! |
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