A Run for Their Money

The failures of Silicon Valley and Signature Banks this weekend have dominated the national conversation. There’s plenty of discussion still to come on how startups might think differently about cash management in the future, such as diversifying bank accounts and guaranteeing balances. 

But in the meantime, here are some communications lessons from the initial response to the crisis: 

  • In times of sensitivity and uncertainty like these, tailor communications to what’s incoming. There were a lot of startups and investment firms with some exposure to SVB—and plenty without. It was equally as important for those without exposure to communicate as those with. Many startups who were not impacted said so via a short tweet after getting a lot of inquiries. Others getting more one-off inquiries responded to employees, LPs and others directly.
  • Be as straightforward and transparent as possible. For a big part of the weekend, many companies were operating in a sort of gray zone, not knowing what would happen to the funds they had in SVB. Companies focused on the facts and tried to share as much as possible while also instilling confidence and working feverishly behind the scenes to address any immediate liquidity requirements.
  • Stay alert to opportunities for how to help. On the investor side, firms hustled to put together packages for startups and other companies that needed more cash immediately. Their ability to leap into action showed their value at a critical moment.
  • Twitter is still a primary source of news and an impactful communication channel.  VCs, founders and other financial industry players took to Twitter in droves to share status updates, provide suggestions and support, and put pressure on decision-makers to act.