Federal regulators’ moves Sunday to protect Silicon Valley Bank depositors eased the immediate crisis for startups, but SVB’s collapse still creates vulnerabilities for clean tech companies, Ben writes.
The big picture: “Lots of founders are temporarily relieved now, but it will take weeks or even months to discern what the long-term impact of this crisis will be,” Tim Latimer, CEO of geothermal startup Fervo Energy, told me via email last night.
Why it matters: SVB is a pillar of the startup ecosystem — and that includes many companies and funds active in climate-friendly energy and sustainability tech.
- The bank provides a suite of banking, finance and advisory services in the startup and project development arenas.
- SVB senior market manager Matthew Trotter recently told Axios‘ Megan Hernbroth that SVB had roughly 1,500 venture-backed startup clients working in climate tech.
What’s next: Julia Travaglini, a senior VP with prominent incubator Greentown Labs, said they’re “actively working” to gauge effects on their roster of 200-plus startups, noting many use SVB.
- “Beyond the Greentown community, this will have tremendous repercussions on climate tech startups and VCs in our space,” she said in an email exchange prior to federal regulators’ moves Sunday.
- It is likely those assets will be bundled and sold to another financial institution, but none had stepped in to continue those contracts as of Sunday evening.
- That could bring construction delays on projects until a sale occurs, she reports. Sign up for Axios Pro Climate Deals for the full story and so much more.
Zoom out: Wedbush Securities analysts, in a note, predict a “tighter financing landscape going forward for tech community…the hurdle for bank loans and other forms of debt financing will be a different world going forward.”
