Silicon Valley Bank collapse concerns founders of color

Washington, The Gulf Observer: In the hours after some of Silicon Valley Bank’s biggest customers started pulling out their money, a WhatsApp group of startup founders who are immigrants of color ballooned to more than 1,000 members.

Questions flowed as the bank’s financial status worsened. Some desperately sought advice: Could they open an account at a larger bank without a Social Security Number? Others questioned whether they had to physically be at a bank to open an account, because they’re visiting parents overseas.

One clear theme emerged: a deep concern about the broader impact on startups led by people of color.

While Wall Street struggles to contain the banking crisis after the swift demise of SVB — the nation’s 16th largest bank and the biggest to fail since the 2008 financial meltdown — industry experts predict it could become even harder for people of color to secure funding or a financial home supporting their startups.

Silicon Valley Bank had opened its doors to such entrepreneurs, offering opportunities to form crucial relationships in the technology and financial communities that had been out of reach within larger financial institutions. But smaller players have fewer means of surviving a collapse, reflecting the perilous journey minority entrepreneurs face while attempting to navigate industries historically rife with racism.