Silicon Valley Surreal Weekend | Tech Crunch

As Silicon Valley Bank crumbled before our eyes on Thursday, a founder told me the world felt like it did when COVID-19 first bared its teeth. I initially scoffed at his analogy: are we really using a still-ongoing, devastating pandemic to describe the downfall of a major bank? But then I realized that we were indeed witnessing the collapse of something sacred.

Now I see the similarity between those dreary days of COVID and the surreality of the past weekend – even amid the collective relief that echoed in Silicon Valley as regulators told depositors funds would be accessible in full from Monday. Over the past four days, wWe’ve reported on a Twitter-induced bank rush, regulators’ takeover of SVB, the company’s resulting scramble to help startups, and entrepreneurs’ scramble to survive. All in Tech Twitter wgoing from panic to anger, from terror to relief, all with fear weighing heavily on both shoulders.

Some investors spoke up, others pointed, and while Twitter was full of good takes and mistimed jokes, my DMs have never been more active with raw, real-life stories about the impact of the crisis. collapse of SVB on people at the frontier of innovation. Now my DMS is full of people celebrating, pouring one, and enjoying a moment of direct relief that felt like the lockdown was ending.

But while it may feel like the happy ending to a nightmare, here’s what has changed irreversibly: People have been slapped in the face by the interconnectedness of technology and the overreliance on certain institutions and voices. I think we’ve all been reminded that a financial story is naturally a human story; and that a failure of this magnitude has an impact far beyond the “tech elite” and however you define Silicon Valley. And, I will add, I hope there has been a realization that we should all stop trying to be banking experts (just as we should all stop trying to be epidemiologists).

I don’t see technology working the same way after what has been said, seen and pushed out loud over the past few weeks. Founders know more than ever which of their investors are truly adding value. The often publicly cordial VCs have drawn lines and chosen teams that we will surely see acting together in the future. And normal people have just opened their eyes to how the often insular world of business and startups works (messy though).

Silicon Valley heaved a collective sigh as it announced that depositors will be covered by regulators. There are still other issues to be resolved before the start of the reconstruction. But the big story ahead is still being written, both to better understand what broke and what is breaking in the larger Silicon Valley reservoir.