Happy Friday. Welcome to The Chaos Coordinator! We are Brain Candy's snarky little sister, delivering carefully curated news happening across the industry (that you should probably care about) right to your inbox, with a hefty dose of irreverence.
In this issue, we dive into:
Silvergate
Silicon Valley Bank
JetBlue x Spirit Airlines
Blockchain Adoption
Salesforce x AI
Social Fragmentation
What's happening in.....
PE/VC
Panic! At the Disco Silicon Valley Bank
A mess unfolds following the financial equivalent of an own goal from tech's favorite bank.
Shares of Silicon Valley Bank (SVB) swan dived Thursday in the wake of the company’s poorly timed and poorly communicated announcement that it is raising additional capital by selling stock. The surprising announcement from SVB came one day after the closure of crypto bank Silvergate, and was explained as an attempt to pad the bank's finances in the midst of a tumultuous economic environment, especially rough on start-ups. Shares were down more than 80% in after-hours trading on Thursday compared to where they were Wednesday morning, wiping over $80 billion in value from the bank's shares. SVB is one of the top 20 largest banks in the United States and provides banking services to the likes of crypto-friendly venture firms Sequoia and Andreessen Horowitz (a16z), as well as being the financial partner of nearly half of the U.S.’s venture-backed startups in the healthcare and technology space that went public last year. The bank is trying to persuade clients not to pull their money over concerns of a liquidity crisis, with CEO Gregory Becker calling clients to assure them their money with the bank is safe.
Could this be the Lehman moment for the startup world? Follow along for live updates here.
ENTERPRISE SaaS/FINTECH
Bye Bye Crypto Bank
Silvergate enters its voluntary wind down era 😔.
Silvergate Capital, a central lender to the crypto industry, announced on Wednesday that operations will be winding down and they will be liquidating its bank. In a press release, the bank’s holding company said it made the decision to shut down “in light of recent industry and regulatory developments.” All deposits will be fully repaid, according to a liquidation plan shared on Wednesday. It’s been clear for a while that the company was struggling alongside some of its most high-profile clients like FTX and Genesis. In January, its earnings report revealed that it lost a billion dollars in one quarter after its customers withdrew $8.1 billion, reports the Verge.
There are several concerns about what the crypto landscape will look like without Silvergate, especially when it comes to where companies will turn to get cash. Read more here.
CAPITAL MARKETS
JetBlue 💔 Spirit Airlines
The L Train of the skies may not be getting the merger it had hoped for.
The Biden Administration is going to court to try to block the merger of JetBlue and Spirit Airlines, arguing that the deal will lead to higher fares and fewer choices for air travelers, reports NPR. JetBlue won a bidding war with Frontier Airlines to buy Spirit for $3.8 billion last year and plans to eliminate Spirit's low cost business model. If the deal eventually is completed, the combined companies would become the nation's fifth largest airline, holding about 9% of the domestic market share. The deal would "eliminate Spirit's unique and disruptive role in the industry," Attorney General Garland said. Bold words to describe an airline where seatbelts will probably come at a cost sooner rather than later, however it seems Spirit is here to stay as it's own entity for now - we can all sit back, relax and watch this lawsuit go down in federal court. But not in a Spirit seat. Those don't recline.
Hot or Not: International Blockchain Adoption Edition
We have five standouts worth a swipe to the right.
Although it has only recently become a household name, blockchain technology has been around for over a decade and has transformed many industries in ways we have not even realized, and the potential has barely been tapped. CoinTelegraph highlights five countries who are leading the way in blockchain adoption with innovative solutions, supportive regulations and more.
If you find yourself developing 'responsible generative AI', we have jolly good news for you.
Enterprises should get ready to get lost in the generative AI sauce, as Salesforce prepares to invest in startups developing what it deems to be “responsible generative AI.” The cloud software giant, via its Salesforce Ventures VC, announced a $250 million generative AI investment fund this week. The fund will be focused on “nurturing the next generation of generative AI startups,” Clara Shih, chief executive officer of Salesforce’s service cloud, said in a briefing with reporters. Salesforce also unveiled new generative AI tools for functions such as drafting customer service responses or initial sales emails this week. Named Einstein GPT, the new tools are integrated with OpenAI’s generative models, reports Bloomberg.
Imagine Pangea breaking apart 180 million years ago. Now pretend Pangea is social media and 180 million years ago is right now.
The ever-changing social media landscape has become fragmented over the past few years, making it more difficult for marketers as they not only need to curate additional content to target specific niches, but do so in reponse to platforms’ algorithms continuously evolving, almost on a day to day, and sometimes hourly, basis. So how do we as marketers address these changes? An eight-article editorial series by Digiday explores the ramifications of a fragmented social marketplace.
The opulent era of tech workplace TikToks, often featuring numerous office amenities, is over thanks to widespread layoffs. Almost as many creators are now coming out with layoff stories, garnering more views than their aspirational counterparts of the past. Read more on the discussion around workplace content here.
Hybrid work forever! Read more here on why even with fully remote workforces declining, a hybrid model is here to stay.
PHRASE OF THE WEEK
SIDE EYE
Side eye is a term - trending on TikTok ofc - that people use when they are questioning someone’s intentions, or silently, but loudly judging them, typically in a negative manner.
