What to do if you're screwed by the SVB collapse

Shit happens, and it’s happened to you. Now what? While I certainly don’t have all the answers I’ve been asked a lot in the past 48 hours. Here’s what I’ve said.


Start by accepting what’s happened, and freeing your mind to figure out what you can do about it.

Stoics celebrate the power of focus on what we control, in part by letting go of worry for what we don’t. Don’t let yourself fall down the rathole of business press speculating on what’s going to happen next with SVB. The truth is nobody knows what, let alone when. Focus instead on doing the work to figure out what action you can take to respond to what’s happened, assuming this isn’t a problem that suddenly take care of itself.

That work starts with getting a clear understanding of the truth on the ground, particularly as it relates to cash flow. What’s the status of your business right now, in bulleted straight facts? How much cash do you have? When are you likely to need more? What are the the most important operating cash flows over the coming weeks and months, and what sources of external capital have real potential for short term impact?

“It’s the end of the world as we know it, and I feel fine.” REM


We all know people who are incredibly effective in bending the world to their will, and people who just sort of drift through it. In my experience the former are just really good at finding a way through whatever mess they encounter on the way to the promised land. And the secret to that kind of nimble adaptability is PLANNING.

Not a plan. “PLANNING.”

“Plans are worthless. But planning is everything.” Dwight D. Eisenhower

First figure out your primary plan, "Plan A." These are the actions you’ll take if the things outside your control go the best they can be expected to go. Right now that probably means getting access to $250K by COB Monday, then some meaningful share of the rest within a matter of weeks.

Next move to your backup plan, "Plan B." This is the plan that you will execute if your primary plan falls through. It should outline alternative courses of action and the steps you will take to mitigate any negative consequences.

Next… what’s your contingency plan? What are the external dependencies in your backup plan, the things you most need to happen? Now… what will you do - meaning what actions will you take - if they don’t? Don’t be afraid to be bold here, outlining extreme measures that you will take to keep your startup afloat.

Finally, spend some time on your emergency plan. This is the plan you’ll execute if all else fails. Emergency plans often change the constraints of the problem your trying to solve. Remember that in an emergency, the only thing that matters is surviving to fight another day, whatever else it takes to get there.

It’s like none of those plans will come to pass, but that doesn’t matter. The process of planning will help you understand what really matters, what you need to focus on, and prepare you for when things - inevitably - go someplace unexpected.


Lastly, fight the temptation to lock yourself in your office and make your team wait for white smoke. You don’t have all the answers, and the truth is - if you’ve surrounded yourself with good people - they don’t expect you to. It's easy for communication to break down in a crisis, and right now that’s the last thing your business needs.

Make sure you’re in close contact with your team, suppliers, and customers, keeping them informed of the situation and what steps you're taking to mitigate its impact. It's also essential to listen to their feedback and concerns, so you can make informed decisions that take into account their needs.

Final Thoughts

A bank collapse can be a devastating event for any startup, but it doesn't have to be the end of the road. By accepting what’s happened and focusing on what you can do about it; creating robust plans for different scenarios, and maintaining open communication with your team, you can navigate through the crisis and come out on the other side. Have faith that you can, that this storm will blow over as storms always do, and that new storms will come after that. This is the life you’ve chosen, on the razor’s edge of greatness and oblivion. And if you think some corporate path would have been a lot easier, I have some friends at a big, successful regional bank just outside San Francisco that have learned that’s not how life works.

“There will be a time when you will need to remember that no matter how bleak or unwinnable a situation, as long as you and your crew remain steadfast in your dedication, one to another, you are never ever without hope.” Jean-Luc Picard

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