A hastily assembled WhatsApp group, then relief: UK tech firms react to SVB
UK tech firms breathed a “collective sigh of relief” on Monday after a rescue of Silicon Valley Bank’s British arm was announced, amid fears that failure to broker a deal would have plunged the industry into an immediate crisis.
Industry insiders said a WhatsApp group called “save UK tech” was hastily assembled over the weekend as the sector attempted to stave off the threat of financial problems swamping tech firms as soon as Monday. A crisis was averted, however, when the government helped broker the acquisition of SVB’s UK operations by HSBC for £1 in a deal announced on Monday morning.
Russ Shaw, the founder of Tech London Advocates, an industry body, said tech firms and investors heaved a “collective sigh of relief” when the deal was announced.
Over Friday, Saturday and Sunday, Shaw said people were “pulling their hair out saying: ‘What do we do?’” Shaw said UK tech firms’ financial exposure to SVB ranged from £25,000 at the lower end of the scale to more than £10m.
One UK company that banked with SVB said the lender’s troubles were an “existential threat”.
Dan Murray-Serter, a co-founder of London-based Heights, which sells health supplements for the brain and gut online, said: “It would have been a scenario of not being able to pay for stock, not being able to serve our customers and being on the hook for paying invoices. We would not have been able to pay.”
Murray-Serter said his fellow founder withdrew money from the company’s current account on Friday when the seriousness of SVB’s problems emerged but the rest was tied up in a 30-day notice account. He added that fellow entrepreneurs and business owners joined an early evening call with SVB on Friday in which they were told that the UK business was separate from the
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