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A comment on VC firms are urging founders to pull money from troubled Silicon Valley Bank. Parent comment

Re:VC firms are urging founders to pull money from troubled ... by shadowofneptune on Thursday March 09, 2023 @05:39PM (#35087848)
Looking at the FDIC website:

> The FDIC does NOT cover (even if purchased at an insured bank):

    Stock investments
    Bond investments
    Mutual funds
    Life insurance policies
    Annuities
    Municipal securities
    Safe deposit boxes or their contents
    U.S. Treasury bills, bonds or note
This article is about the bank's bonds, if I read it correctly. Safe for a household does not mean safe for a company that lives on investment money.
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Re:VC firms are urging founders to pull money from troubled ... by ceejayoz on Thursday March 09, 2023 @05:41PM (#35087865)
There's an equivalent for securities, the SIPC. It's capped like FDIC insurance is, but bonds/stocks have some protection in this regard.

https://en.wikipedia.org/wiki/Securities_Investor_Protection...

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Re:VC firms are urging founders to pull money from troubled ... by shadowofneptune on Thursday March 09, 2023 @05:43PM (#35087881)
Ah, I see. Looks like it still only has a limit of 250,000 USD, which seems low for modern business. How far would that get some of these companies?
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Re:VC firms are urging founders to pull money from troubled ... by slg on Thursday March 09, 2023 @06:17PM (#35088242)
Aren't most (all?) of those clearly owned and register to the individual regardless of which bank holds them? If the bank holding my stock goes out of business, it is still my stock. It doesn't just evaporate with the bank unless there is some fraud involved. Some other bank will swoop in to buy those accounts and my stock will move there.

The main concern here is likely less about straight-up losing any of those investments and more the huge headache that comes with being unable to access your money while the whole process plays out.

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Re:VC firms are urging founders to pull money from troubled ... by iancarroll on Thursday March 09, 2023 @06:19PM (#35088265)
The bank can take your cash deposits and invest them, which is the problem occurring with SVB. In this case, your deposits are still insured via FDIC.

If you buy investment products from a bank, and they hold those for you, those are not insured via FDIC.

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