Union IT minister to meet Indian startups amid concerns over Silicon Valley Bank collapse

NEW DELHI: Union Minister of State for Information Technology Rajeev Chandrasekhar he said Sunday that he will meet with startups this week to assess the impact on them following the collapse of the US headquarters Silicon Valley Bank.
The meeting comes amid growing concerns about the bank collapse’s knock-on effect on startups around the world, including India.
“Startups are a big part of India’s new economy. I will meet Indian startups this week to understand the impact on them and how the government can help during the crisis”, Rajeev Chandrasekhar, state minister for IT said on Twitter.

US regulators on Friday pulled the plug on SVB – a key lender to US startups since the 1980s – after a run on deposits made it no longer tenable for the midsize bank to stay afloat on its own.
SVB has exposure to over 20 startups in India and started investing here in 2003.
According to startup research consultant Tracxn, SVB has invested in several Indian companies, including Paytm, Carwale, Bluestone, Shaadi and Sarva. In October last year, SVB invested $150 million in contract intelligence firm Icertis.
Since the crash, startup founders and investors in Mumbai have been trading rumors about which fledgling company might be the first to fail, Bloomberg reported.
India has one of the largest startup markets in the world, with many multi-billion dollar valuations in recent years and the backing of foreign investors who have made bold bets on digital and other businesses.
SVB’s bankruptcy, the largest in the US since the 2008 financial crisis, has shocked global markets, hit banking stocks and is now unsettled for Indian business leaders.
Two partners of an Indian venture capital fund and a lender to Indian start-ups told Reuters they were running checks with portfolio companies on any SVB exposure and, if so, whether it is a significant portion of their total bank balance.
An Indian founder told Bloomberg News that he has been unable to recoup the company’s funds and now has only working capital left. Another rushed to stop and redirect customer payments to his company’s SVB account, while also establishing new payroll arrangements. Three founders and a startup investor said they hadn’t slept in 48 hours.
(With contributions from agencies)


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