The crisis surrounding the Silicon Valley Bank (SVB) is going to affect investment in the tech sector. Not only American companies are expected to be affected, but also companies in the Netherlands.
So say Dutch experts to the Financieele Dagblad. According to Rinke Zonneveld, CEO at the public-private investment fund Invest-NL, the investment climate will become even bleaker. Startups and scale-ups will get an extra “crunch” and the impact of this crisis is uncertain, according to him. Zonneveld finds it unfortunate that the SVB has now gone under. Invest-NL was recently in talks with the bank about expansion in Europe and a possible branch in the Netherlands.
Discussions with the SVB included the provision of debt assistance, something from which the Netherlands could still benefit, says Maurice van Tilburg, director at interest group Techleap. The SVB also played a major role in the area of solar energy financing. This market segment, too, is now going to get tougher.
Consequences for Dutch tech startups in the US
Especially Dutch (tech) companies that want to develop activities in the US are going to feel the consequences of the crisis. Lately it has already been difficult to raise capital in the US. This is now becoming even more difficult. The collapse of the bank is a negative signal in a market where valuations of tech companies are already falling. Many companies in need of investment in the coming year may not make it, indicates Oliver Binkhorst of DutchTechInc.
In addition, with the SVB, a large network from which Dutch companies could benefit is disappearing, Techleap says. Asked by the FD, the Dutch consulate in San Francisco cannot yet indicate what impact the banking crisis will have on its own incentive programs for tech startups.
Other investors hope the turmoil over the bank does not spill over to Europe.
Slight optimism ahead
About the future, the various Dutch tech startup experts interviewed are worried. Among other things, they cannot quite assess whether the possible buyers of SVB’s estate will continue investment activities. It was recently announced that in the UK the bank HSBC is taking over the SVB branch in London.
Nevertheless, there is also a little optimism. Binkhorst expects that if all SVB investment activities go away, Silicon Valley will come up with new initiatives after all. Perhaps even a new bank.
According to Zonneveld, the crisis shows that American investment capital still plays a major role in the European techecosystem. Now that these investments are faltering, it is time to see that tech startups have become too dependent on this money and that things may have to change. The ensuing discussion can only be seen as a win.
Other Dutch tech entrepreneurs indicate that the time when so much tech money was in one place is now a thing of the past. Many tech startups have therefore now started thinking about spreading their capital across multiple banks and accounts.