March 10, 2023

Firstminute Capital tells LPs not to send money to SVB — as other funds also move money from the bank

It’s not just startups withdrawing capital from SVB — despite calls to remain calm

Amy Lewin

3 min read

Image: Ilya Grigorik

It’s not just startups withdrawing capital from Silicon Valley Bank (SVB) today, in light of fears around the US bank’s liquidity after a stock price tumble yesterday. European VCs are also moving capital from the bank’s UK subsidiary — and asking their LPs not to send capital to their SVB accounts. 

In an email sent today and seen by Sifted, Spencer Crawley, cofounder and managing partner at London-based VC firm firstminute Capital, asked his investors not to send money to the fund’s SVB account following a capital call made last week. 

The email, sent to firstminute LPs, reads: “Regarding the fund II capital call issued last week, if you have not funded, please wait to do so until further notice.”


Crawley goes on to write that “SVB is an important partner to the entire tech ecosystem”. In November last year, SVB took a part-ownership stake in the Founders Forum Group — a startup community and events business cofounded by Brent Hoberman, who also cofounded firstminute. 

Hoberman declined to comment on the email when asked by Sifted. 


Several other VC firms in Europe have emailed LPs asking them not to send money requested via recent capital calls as well, Sifted understands.

Another VC tells Sifted that it’s taking a hedged approach, transferring some of its drawdown cash back to LPs for now. It’s also splitting its operating capital in half, moving 50% to another bank and leaving 50% in SVB.

Portfolio advice

Startups are turning to VCs for advice on what to do with their capital in the bank. While some VCs cautioned startups not to be too hasty and remain calm, others have advised startups to have cash in several different accounts to ensure they have enough capital on hand to make payroll and continue smooth business operations.

One such was Berlin-based early-stage VC Cherry Ventures. 

“We strongly encourage you to take steps to mitigate risk,” reads an email sent from "Team Cherry" and seen by Sifted. “We think it is wise to diversify your cash holdings to have a larger share of your runway outside of SVB. Ideally, you should rely on utilising several established banking relationships — if not now, then going forward — to ensure greater diversification and accessibility of funds.” 

"Some VCs are telling founders to move money out, even if only to a personal account. Or otherwise open an account with JP Morgan etc," one UK fintech founder tells Sifted.

The bigger picture

But as some VCs and startups move to ensure their capital is protected in the short-term, they could be creating much bigger problems for the startup ecosystem in the longer term. 

"The ‘rational’ thing on a company level is to move your money, but if everyone acts 'rationally’, that creates an overreaction at the macro level,” says Reem Mobassaleh Wyndham, founding partner at London-based early-stage VC Pact. 

SVB Financial Group is now reported to be exploring a sale, according to both Reuters and CNBC, after halting trading earlier today.

SVB UK issued a statement to press just before 3pm GMT on Friday confirming that its balance sheet is separate from the SVB Financial Group. 


Update: At 5pm GMT on Friday, SVB was shut down by California regulators. A few hours later, the Bank of England declared it is starting insolvency proceedings for SVB UK.

Amy Lewin

Amy Lewin is Sifted’s editor and cohost of Startup Europe — The Sifted Podcast , and writes Up Round, a weekly newsletter on VC. Follow her on X and LinkedIn