India tech minister options to meet startups on SVB fallout

MUMBAI, March 12 (Reuters) – India’s point out minister for technological know-how said on Sunday he will satisfy start off-ups this 7 days to assess the impact on them of Silicon Valley Bank’s (SIVB.O) collapse, as concerns increase about the fallout for the Indian start off-up sector.

California banking regulators shut down Silicon Valley Lender (SVB) on Friday soon after a operate on the loan company, which had $209 billion in assets at the stop of 2022, with depositors pulling out as much as $42 billion on a one day, rendering it insolvent.

“Start-ups are an important part of the new India overall economy. I will satisfy with Indian Startups this week to realize influence on them and how the federal government can support through the crisis,” Rajeev Chandrasekhar, the state minister for IT mentioned on Twitter.

India has one particular of the world’s greatest get started-up markets, with a lot of clocking multi-billion-greenback valuations in recent yrs and obtaining the backing of foreign traders, who have created daring bets on digital and other tech organizations.

SVB’s failure, the biggest in the U.S. considering that the 2008 fiscal disaster, has roiled global marketplaces, strike banking stocks and is now unsettling Indian business people.

Two associates at an Indian undertaking capital fund and 1 loan company to Indian start-ups advised Reuters that they are working checks with portfolio firms on any SVB publicity and if so, no matter if it is a significant component of their full financial institution harmony.

Consumer world wide web startups, which have drawn the bulk of funding in India in recent a long time, are considerably less affected for the reason that they either do not have an SVB account or have minimum publicity to it, the a few folks claimed.

“Spoke to some founders and it is really terrible,” Ashish Dave, CEO of Mirae Asset Enterprise Investments (India), wrote in a tweet.

“Specially for Indian founders … who setup their U.S. corporations and lifted their original round, SVB is default lender. Uncertainty is killing them. Expansion kinds are rather safer as they diversified. Very last thing founders needed.”

Computer software firm Freshworks (FRSH.O) claimed it has minimal exposure to the SVB predicament relative to the firm’s overall balance sheet.

“As we grew, we introduced on bigger, diversified banking institutions these types of as Morgan Stanley, JP Morgan and UBS. The extensive the greater part of our income and marketable securities right now is not held at SVB,” Freshworks explained in a web site article, introducing that the organization does not foresee any disruption to staff or prospects.

Freshworks explained it is doing work with clients and sellers who ended up applying its SVB account to migrate to alternate lender accounts.

India’s Nazara Systems Ltd (NAZA.NS), a cellular gaming corporation, reported in a stock exchange submitting that two of its subsidiaries, Kiddopia Inc and Mediawrkz Inc, maintain cash balances totalling $7.75 million or 640 million rupees with SVB.

Reporting by M. Sriram and Munsif Vengattil Composing by Swati Bhat Added reporting by Jahnavi Nidumolu Enhancing by Alexander Smith and Sharon Singleton

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