by Walking into Roku City on a Sunday afternoon, you’d hardly know the eponymous company was having an unusually stressful weekend.
Sure enough, the fake metropolis — a reimagining of many of Roku’s stories favorite screen saver, created in the heart of downtown Austin for the city’s tech and cultural extravaganza South by Southwest — has had its share of problems. A huge robot hit a part of the facility. the tentacles of one kraken rose menacingly from the sea at another.
But nothing helped suggest that San Jose-based Roku streaming and hardware giant, he had just seen millions of dollars disappear into thin air. According to a regulatory filing, the company had $487 million, or about a quarter of its cash, stashed away at Silicon Valley Bank — the tech world’s main lender that failedspectacularly and unexpectedly, late last week.
Amid fears that one bank could spread to other financial institutions, federal agencies — including the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp. — they now say that all the bank’s customers will be able to get their money back. But since the Silicon Valley bank did a lot of business in the tech and media ecosystem — the lifeblood of South by Southwest, or SXSW, a combination film festival, tech expo and cultural summit — the crisis cast a pall over its early days. the conference.
Attendees shared rumors of startup founders crying in the street after news of the bank’s collapse. Even among most attendees, private Slack channels were reportedly flooded with sympathy.
Roku did not immediately respond to a request for comment.
At a small mixer Sunday afternoon for people working in the field of “conversational artificial intelligence” — that is, artificially intelligent programs that mimic human speech, including chatbots and synthetic voices — some said the bank’s collapse had softened the spirits at the annual conference.
The news was “shocking” to those present, said Ciro Sobral, 32, a product manager at Singapore-based e-commerce company Shopee. Since Silicon Valley Bank has been a fixture of the tech world for decades, he added, people are drawing parallels between its collapse and the 2008 financial meltdown.
“Everyone was caught off guard,” he said.
Although his employer was not directly affected, he added, the resulting chaos could lead to greater concentration in the field of artificial intelligence.
“When something like this happens, it’s a big opportunity for the key Big Tech leaders,” such as Microsoft and Google, Sobral said. “I don’t know what will happen next, because a lot of small businesses used” the bank.
Shannon Brownlee, another attendee at the AI meetup, said that although communication technology company Valence Vibrations did not keep its own money at Silicon Valley Bank, outside investors who had previously expressed interest in the startup now told her they needed more time to figure out their finances.
“Our main investor since the last one [funding] round had $30 million in Silicon Valley Bank,” he said. “He’s just messing around right now trying to figure it out.”
Upon arriving at the convention Friday morning — she lives in Los Angeles — Brownlee, 22, heard about the crash almost immediately.
“We arrived, went to sit in a coffee shop, do some work,” Brownlee said. “And as soon as we sat down, it was like, ‘Oh my God, everybody’s freaking out.’
However, he has heard of other conference attendees who have it much worse. Some tech workers arrived in Austin only to find they no longer had access to company assets, he said. now they are “just stuck here”.
“People are definitely nervous,” the startup co-founder added, and while the panel’s lineup appears to have remained relatively unaffected, the overall tone is decidedly darker.
Other media interests affected by the bank’s failure include video platform Vimeo and video game platform Roblox. Wrapbook, an entertainment industry payroll platform, said on Friday that the bank’s collapse meant processing its payroll would be delayed.
“Bank failure is an extreme external event,” Wrapbook he tweeted. “We apologize, on behalf of all of us at Wrapbook, for any challenge this poses to you.”
Reign Ventures, an early-stage investment fund, tweeted Saturday that it had to cancel events it had planned to host at SXSW because of the bank collapse.
“We are very sorry to miss you and send our support to all startups and VCs affected during this difficult time,” the company He wrote.
Dan Solomon, senior editor at Texas Monthly; he said in his own tweet on Friday that at a panel he attended, a startup founder spent the entire time “trying to make a bank transfer before 5pm so she could do her payroll.”
There were, indeed, some oblique references to the week’s news during the convention’s education-oriented panels. During a talk on the future of artificial intelligence, BuzzFeed CEO Jonah Peretti quipped that everything these days is driven by virality — even bank metrics.
And during a Monday morning panel titled “How D.C. Wants to Mess with Your Startup,” U.S. Chamber of Commerce President Susan Clark framed the latest actions by federal regulators to protect depositors as example of when government can be useful to tech companies — even as she pushed back in the rest of her speech on what she called federal overreach in the economy.
“It’s an important morning for a lot of us to be quiet,” Clark said. “It’s an important morning to get smarter and do the homework to really understand what happened.”
But for the most part, several tech-themed panels at SXSW didn’t acknowledge the crisis that was surely affecting many in the audience, if not themselves on stage.
Ironically, it was the cultural side of the festival that seemed more willing to face the crisis.
On a live episode Sunday afternoon of comedian Matt Besser’s popular comedy podcast improv4humans, Silicon Valley Bank received several mentions. At one point, during a scene about Jesus struggling with financial problems, someone in the audience shouted “SVB!” spontaneous.
Elsewhere, guest star James Adamian played his character as a SXSW panelist who had a horrible trip: “I just lost all my seed money in the SVB explosion!”
