SANTA CLARA, CA, USA – MARCH 13: People wait outside Silicon Valley Bank’s headquarters in Santa Clara, CA to withdraw money after federal government intervention on March 13, 2023 following the bank’s collapse. (Photo by Nikolas Liepins/Anadolu Agency via Getty Images)
Nikolas Liepins | Anadolu Agency | Getty Images
The collapse of the US-based Silicon Valley Bank is unlikely to hurt fundraising for tech startups in Southeast Asia, venture capitalists and an analyst told CNBC.
The bank served many venture capital firms and venture capital-backed start-ups. But last week depositors rushed to withdraw their funds as panic spread over the bank’s financial condition, causing it to collapse.
“I find [the impact on fundraising is] Be careful, but I don’t think the contagion is spreading,” David Gowdey, managing partner of Southeast Asian venture capital firm Jungle Ventures, told CNBC’s Squawk Box Asia on Tuesday.
“I think Minister Yellen and the Government have done a fantastic job of stepping in and removing a lot of this risk and creating a lot of stability in the markets,” he said. On Sunday, US officials, including Treasury Secretary Janet Yellen, announced plans to freeze depositors at the bank.
Gowdey said SVB is the company’s main bank, but added: “We’re pulling a lot of this money into Southeast Asia, to the banks in Singapore.
Golden Gate Ventures, which also invests in Southeast Asian startups, said the SVB fallout is an opportunity for the region.
“That was actually helpful for Southeast Asia. It’s now looking like a golden child for US investors. Investors are starting to say, I want to diversify into different bank accounts, different geographies, different currencies,” Vinnie Lauria, managing partner at Golden Gate Ventures, told CNBC’s Street Signs Asia on Tuesday.
“And this is where Southeast Asia has its time to shine given the situation,” Lauria added.
Asked if the situation is making fundraising difficult, Gowdey said funds are well capitalized in Southeast Asia.
“I think it’s selective because of the macro environment. [Accessing] The capital is getting harder, but the capital is there and it’s being deployed,” Gowdey said.
VC firms previously told CNBC that economic uncertainties have made them more selective about investing in 2023.
“[In terms of] Access to capital for tech entrepreneurs, VCs will still be able to fund them,” Ray Wang, founder and chairman of Silicon Valley-based Constellation Research, told CNBC’s Street Signs Asia on Tuesday.
“But it’s about getting bank loans, having working capital, being able to actually run the operation, and having a bank that understands how a tech company or a biotech company works. That’s really what’s lost here,” Wang added.