In the aftermath of Silicon Valley Bank's crash, local economists explain what the bank's collapse means for the Boston area's prolific startup scene.
Silicon Valley Bank customers in Massachusettsto withdraw their money this week, but there’s concern that the reverberations of the bank’s collapse could linger much longer. WBUR’s Yasmin Amer reports that experts worry it could have a chilling effect on the Boston area’s prolific startup scene.
As Babson College finance professor Michael Goldstein explained, that’s not good for entrepreneurs. “It has nothing to do with whether my drug works or [if] my idea’s good. It’s are the people who are willing to fund me willing to send me money when they’re worried about the banking system,” Goldstein said.
Nicole Obi, the head of the Black Economic Council of Massachusetts, also worried about the disproportionate impact belt-tightening may have on local entrepreneurs of color in the early stages of business. “The momentum around VC players investing in Black and Latino firms has just slowly started to tick up,” Obi said, adding her concern that those businesses will “be the first to be dropped” if there’s a pullback.remained one of the top three U.S.
What’s next: WBUR’s Beth Healy reports that Secretary of State Bill Galvin opened an investigation to see if there’s evidence that SVB’s executives took profits when they knew the bank was in trouble. NPRDid you know
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