Imagine the startup has a valuable product, they’re affected by SVB collapse:

• If the company was already profitable - they will open a new account and survive.

• If the company wasn’t profitable yet - they will face administration, insolvency procedure and finally go bankrupt.

The first group is smaller for the startups are usually not profitable for a long time.

Let’s focus on the second group (most of them):

• Other banks won’t give them the loan so they can open a new bank account and have cash to survive the next months (it was hard / almost impossible to get a loan before SVB already).

• Some VCs will invest again, diluting the founders / entrepreneurs massively, but it will be hard for them to make so many ad-hoc investments at the same time.

For majority of them the only way to go will be to close the business and their product is used by many customers - they will ask their hosting provider to run the servers for free until they find a solution (a sale of the business).

Now imagine thousands of startups submitting the request to the giants (Google, Amazon, Twitter, Facebook, etc.) saying - “Please purchase out product, we’ve got 1,000 customers using it. Don’t allow it to disappear.”

It will be the worst time to sell. The giants will buy thousands of them for cheap.