Last week, SVB Financial filed for Chapter 11, and First Republic Bank found saviors in the form of some of the nation’s largest banks that reportedly came together to bolster it with $30bn in rescue deposits. African companies affected by the SVB collapse include mobile money transfer start-up, Nala, which was able to pull its funds out before it collapsed. However, Chipper Cash was among several start-ups unable to access a portion of their funds; they noted how prolific SVB was in the start-up ecosystem when it came to companies opening SVB bank accounts. Founders and investors in the robotics sector, typically a capital-intensive industry, are using this as a cautionary tale, and changing the way they manage counterparty risk. Diversification of assets can be harder than it seems, but it’s essential for keeping funds safe, saving a company from having its eggs all in one basket. Other news of the week includes the Q1 2023 Digital Trust & Safety Index by Sift’s report, which shows that buy now, pay later companies saw payment fraud increase by 211%; and Adyen’s ability to authenticate the consumer on behalf of the issuer, while they remain on the merchant checkout page to help merchants get a conversion uplift of up to 7%.
Silicon Valley Bank’s fall is teaching global lessons. #fintech #startups #innovation
