Posted on 03/14/2023 12:09:28 AM PDT by dennisw
"Silicon Valley Bank was in many ways a climate bank," Kiran Bhatraju, the founder and CEO of Arcadia, the largest community-solar manager in the country, told the New York Times. "When you have the majority of the market banking through one institution, there's going to be a lot of collateral damage."
(WAAAGH)
The fall of Silicon Valley Bank leaves a major financing gap for companies developing climate solutions like solar farms and carbon-removal technology. That could make it harder for startups to get funding and scale their operations.
(WAAAGH)
SVB's website says the bank worked with more than 1,550 clients in the climate-tech and sustainability sector, particularly community solar. The bank also says it led or participated in 62% of community-solar financing deals, worth about $3.2 billion in total. And according to ImpactAlpha, SVB was a leading provider of venture debt to climate startups.
Ethan Cohen-Cole, the cofounder and CEO of Capture6, a startup developing facilities for carbon removal and storage, is an SVB client. Cohen-Cole told the Times that he expects to be able to pay his 20 employees because of the $250,000 insurance payout from the Federal Deposit Insurance Corporation. The company had about $4 million in accounts managed by SVB.
The fallout has led to a network of climate startups, venture-capital firms, and other lenders to mobilize their resources and help blunt the impact, Impact Alpha reported. A handful of fundraising initiatives emerged in recent days to help founders who need short-term cash. These include efforts by the Open Road Alliance, which provides bridge loans to social-impact companies, and Enduring Planet, which provides growth capital to climate entrepreneurs.
(Excerpt) Read more at msn.com ...
Silicon Valley Bank was in many ways a climate bank,”
It probably should have been a bank bank.
A silver lining!
Beyond the obvious fleecing of taxpayers via government subsidies, exactly what is the business model of a climate startup?
This is happening in a country where no bank will lend $100,000 to an 18 year old who wants to start a business, but will let same 18 year old run up $500,000 in “STUDENT DEBT”.
The bank should have been allowed to fail, and the depositors should not have been bailed out. Then we would not have any more “climate banks” being started.
Could be too easy funding of unprofitable ventures was at least part of the problem.
You’re welcome. Just tell him to be ready for some strange responses.
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