SALT LAKE CITY — The collapse of Silicon Valley Bank is something that sent thousands of owners of small businesses and startups scrambling, with many trying to figure out how to meet their next payroll.
For Kickstart, a venture capital firm based in Cottonwood Heights, says hundreds of their companies were faced with major challenges, but are grateful for solutions announced over the last 24 hours on the state and federal level that guarantees depositors.
"It’s a big day for startups across the U.S., especially here in Utah," said Kickstart founder Gavin Christensen. "The name is Silicon Valley Bank, but really it’s the startups bank. This impacts those small companies the most."
Small businesses were forced to scramble to avoid disaster when accounts were locked up last week.
"We were going to have lots of challenges: layoffs, furloughs, companies shutting down. It was getting bad, so we’re really grateful something happened," Christiansen said.
Many like Christensen are thankful to Utah Gov. Spencer Cox and Sen. Mitt Romney who understood the impact of allowing a bank like this to fail.
"This matters to our economy because of payroll and jobs and these are depositors," he said. "Hey, investors and debt holders lost all their money in Silicon Valley Bank and that’s totally fair, that’s capitalism. But for depositors to put money in a bank and not know that’s safe … that’s to ensure confidence that’s so important in our system."
Kickstart general partner Kat Kennedy says it's hard enough to get a small business up and running without the fear of having a bank account frozen.
"It’s really really hard to start a company," she explained. "It’s really, really hard to grow that to the point where you can have influence and impact, and so what happened last week was just one more thing on top of it that you would just never, ever assume that you would just have your bank account locked up."
Kennedy added that while many may hear about Silicon Valley Bank and think it's just big tech companies that are affected, it's actually the little businesses that are hit the hardest,
"Those who are most affected are individuals, you know, the founders of companies of all sizes. We think Facebook, we think Uber, we think WeWork, but the reality here in Utah is tech is everywhere. It’s individuals risking it all to start companies that ultimately aim to improve lives for all of us."
