Last week was really dark for financial institutions in the United States after the collapse of Silicon Valley Bank, similar to the one that occurred in 2008 and that triggered a global crisis. Given this collapse, the most affected have been all the companies and families that had their savings here and now found it impossible to recover them, until the intervention of the State. But worst of all, the majority of depositors They are startups among which is one of Spanish origin.
Specifically, the affected party is RevenueCat, a startup founded by Miguel Carranza of Seville origin and Jacob Eiting from Silicon Valley. The main objective of this platform is allow developers to monetize their apps with a subscription system, and for which they received an initial investment of 15 million dollars. But now they are in trouble.
The crisis in Silicon Valley that reaches Spain
Has been Miguel Carranza himself the one who has given details about the state of his company. He has reported that RevenueCat is in 12 countries and has 64 employees in Spain. Now with the problems in Silicon Valley Bank they are going to have problems to find financing and this directly affects the payroll payments of all families.
It also details that they are not as bad as other startups, having 98% of the money outside of SVB, but they were managed with them. The problem in this case is always when it will be possible to access the money to have sufficient liquidity and face the day-to-day payments. Likewise, he reaffirms that his service will work without problem.
The team of @RevenueCat It is distributed in 12 countries. 64 employees, 20% in Spain.
The Silicon Valley Bank debacle puts us in jeopardy to find liquidity and survive next week.
This is not a local problem for billionaire VCs. The impact can be global
— Miguel Carranza (@elwatto) March 12, 2023
And it is a reality that in Spain there is little financing for this type of project, and many Spaniards who need to undertake must emigrate to Silicon Valley, which is the cradle of entrepreneurship and startups. The problem comes when one of the largest financial companies falls like this overnight, leaving many families in great uncertainty. Miguel himself in his tweet details that there are many Spanish companies affected but unfortunately there is not enough visibility.
In the last few hours, this crisis has softened, thanks to the decision of the United States to unlock all the funds that would have been deposited to startups and individuals. This is great news, as otherwise we would have seen a large number of companies directly dependent on these funds go bankrupt. The return of the deposits will not come from the taxpayers, but from the FDIC fund, which is a savings insurance of up to 250 thousand dollars. This money will be obtained from the sale of the bank’s assets, and in the event that it is not enough, the help of other entities will be sought and it will be possible to access it as of today.
What is clear is that the financial world is considering a bailout, and we already see how the main stock indices are being severely affected, such as the IBEX 35.
But what is clear is that the great instability that startups can have today has been evidenced, since have difficulty finding financing, and if they find it, it is really unstable as has happened with this entity. In addition, although we are talking about a bank in the United States, we must take into account its great relevance in the global framework, making its collapse affect people from all countries.
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