SANTA CLARA, CA, USA – MARCH 13: People wait outside the headquarters of Silicon Valley Bank in Santa Clara, California to withdraw funds after the federal government intervened after the collapse of the bank, March 13, 2023. (Photo: Nikolas Liepins/Anadolu) Agency via Getty Images)
Nikolas Lepins | Anadolu Agency | Getty Images
The collapse of US-based Silicon Valley Bank is unlikely to affect fundraising for tech startups in Southeast Asia, enterprise capitalists and analysts told CNBC.
The bank has provided services to many enterprise capital firms and start-ups backed by enterprise capital. But last week, depositors rushed to withdraw their funds as panic over the bank’s financial situation spread, causing it to fail.
“I feel [the impact on fundraising is] beware, but I do not think the contagion will spread,” David Gowdey, managing partner at Southeast Asian enterprise capital firm Jungle Ventures, told CNBC’s “Squawk Box Asia” on Tuesday.
“I feel Secretary Yellen and the federal government have done a improbable job of stepping in and removing numerous that risk, creating numerous stability within the markets,” he said. On Sunday, US officials, including Treasury Secretary Janet Yellen, announced plans to protect the bank’s depositors.
Gowdey said SVB is the corporate’s principal bank, but added: “We’re pulling numerous that cash out to Southeast Asia, to banks in Singapore. So for us, exposure to SVB wasn’t much.”
Golden Gate Ventures, which also invests in Southeast Asian start-ups, said SVB’s collapse is a chance for the region.
“It has actually helped Southeast Asia. Now it looks like a golden child for American investors. Investors are starting to say: I would like to diversify 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 time to shine,” added Lauria.
Asked if the situation was hampering fundraising, Gowdey said funds in Southeast Asia are well capitalized.
“I feel it’s selective due to the macro environment. [Accessing] the capital will turn out to be harder, however the capital is and is being implemented,” said Gowdey.
VC firms previously told CNBC that economic uncertainty made them more picky about investments in 2023.
“[In terms of] access to capital for tech entrepreneurs, VCs will still find a way to fund them,” Ray Wang, founder and president of Silicon Valley-based Constellation Research, told CNBC’s “Street Signs Asia” on Tuesday.
“Nevertheless it’s about taking bank loans, having working capital, having the ability to actually run operations, and having a bank that understands how a tech company or a biotech company works. It really is lost here,” added Wang.