The company’s downward spiral began late Wednesday, when it surprised investors with news that it needed to raise $2.25 billion to shore up its balance sheet. “This was a hysteria-induced bank run caused by VCs,” Ryan Falvey, a fintech investor of Restive Ventures, told CNBC. All told, customers withdrew a staggering $42 billion of deposits by the end of Thursday, according to a California regulatory filing. Now, those who remained with SVB face an uncertain timeline for retrieving their money.
On Wednesday, Silicon Valley Bank was a well-capitalized institution seeking to raise some funds.
Within 48 hours, a panic induced by the very venture capital community that