The SVB Crisis

In this Issue: the SVB Crisis and Links to Resources • Access Hour for Members • Keynote Announced

Angel University Starts Soon! • IFS Almost Sold Out, Get Connected Now! • Award Nominations Due

Monday, March 13, 2023 – The near-term crisis has largely been averted with the Federal Reserve, Treasury and FDIC regulators announcing that depositors regained access to 100% of their money starting Monday and that no losses will be borne by the taxpayer. The move should restore confidence and keep startups solvent and their employees employed, but there likely will be some longer-lasting psychological effects relating to capital risk that we should all be on the lookout for.

As the situation is analyzed, lessons will be learned on everything from levered banking investment models and the impact of interest rate fluctuations on long term bonds to the allocation to cyrptocurrency investments. We’ll continue to support our members and their portfolio companies by discussing and breaking down that information via our articles, webinars and at Summit 2023.

While a run on a bank by current depositors can clearly accelerate negative trends, we must also be mindful of the responsible support of the startup ecosystem that can and should come from venture capitalists, angels and other stakeholders. As they have proved time and time again, angels have embraced portfolio companies even in times of tougher fundraising and worked vigorously to keep startups, and job growth, moving forward. Look for future analysis of these points as more information becomes available.

At ACA, we commend the VC’s and angels that have rallied around their entrepreneurs to repurpose lessons learned from the 2008/2009 recession. One positive response can be seen in the more than 300 venture capital firms that have signed a letter saying they would be willing to work with Silicon Valley Bank under new ownership provided it is appropriately capitalized.

From the U.S. House Committee on Financial Services: “Silicon Valley Bank (SVB) was closed by the California Department of Financial Protection and Innovation (DFPI), and the Federal Deposit Insurance Corporation (FDIC) was named as receiver. The FDIC also created the Deposit Insurance National Bank of Santa Clara (DINB) as a short-term vehicle to facilitate SVB’s resolution…SVB was the 16th largest bank in the U.S., and its failure is the second largest U.S. history, behind only the 2008 failure of Washington Mutual with roughly $300 billion in total assets. As of December 31, 2022, SVB had about $209 billion in total assets and about $175 billion in total deposits. Roughly $151 billion of those deposits were uninsured.”

Additionally we believe, now more than ever, it is critical that the financial thresholds for the accredited investor definition remain unchanged as ALL of our communities need access to capital, particularly those historically lacking such access. ACA will continue to follow and support the angel community and communicate as appropriate as changes occur.

These and other resources will be continually updated on our blog.

First ACA Member Access Hour a Success – Members Get Access to Information Not Found Anywhere Else!

The first of a new, quarterly member benefit, the ACA Access Hour for Members kicked off with an incredible panel of leaders and angel experts. Attendees and panelists got to dig into the knowledge of some of the country’s most successful angel investors and covered topics such as the critical need for best practice due diligence, the number of investments needed to make a portfolio strategy successful, the difference between a beginner, intermediate and advanced angel investor and the makeup of angel groups just getting started today.

What Would You Like to Discuss?

Reach out to the Membership & Marketing Committee of volunteers with ideas on topics for the next session via email.

Future Dates – Be on the Lookout to Register!

David Bach, MD, is a Harvard-trained neuroscientist and Founder and CEO of Optios, a San Diego-based NeuroPerformance company that works with the world’s most elite performers – including professional athletes and hedge fund managers – using cutting-edge neuroscience to dramatically enhance their cognitive performance.

Prior to founding Optios, he was a serial entrepreneur, venture capitalist, management consultant, scientist, physician, martial artist, and professional cellist. As an entrepreneur, David founded and built three prior companies: Touchstone Health, Empyrean Benefit Solutions and Leprechaun HCC Management. Each of these became a $200M+ enterprise. His venture capital experience was with TA Associates in Boston.

Angel Investing Basics:

Angel Investing Deeper Dive:

An uncertain economy doesn’t mean decision-making has to stall. Connecting with peers, building community trust, and nurturing employees are three steps your startup can take to nurture growth and weather potential storms.

The Hans Severiens Award: recognizing an individual’s or team of individuals’ work in advancing the field of angel investing, named after the founder of the Band of Angels. The Hans Severiens Award is presented annually to recognize an individual or team of individuals’ work in advancing the field of angel investing.

The Luis Villalobos Award: recognizes the most ingenious and innovative ideas recently financed by members of the Angel Capital Association. Two category winners will be selected to attend the ACA Summit and honored live and throughout the event. The award is presented to the winning CEOs during the annual awards ceremony at the 2023 ACA Summit (May 16-18, 2023).

Go online to learn more about the incredible work of Luis Villalobos and Hans Severiens or for information and forms on how to nominate your portfolio company or angel leader. If you have further questions, please reach out to Membership Director, Sarah Dickey.

ACA’s Innovation Funders Showcase (IFS) is like no other. This is not your traditional pitch event. The ACA community represents the most comprehensive investment segment of the early stage asset class with 250 Angel Groups representing more than 15,000 accredited investors. In a typical ACA Summit, investor representation exceeds 50% of our total group population.

This means that investors are in attendance not only to make personal investment decisions, but also to bring the next hot commodity back to their home angel group for further investment consideration. We regularly see groups that received IFS exposure still getting screening invites from ACA member groups 12+ months after their initial pitch. ACA offers an incredibly efficient and economical path to capital that can pay dividends for months following the presentation.

Please reach out to Partnerships Director Damien Delgado to get started!

On May 17, 2023, the Angel Investor Foundation will be hosting our first silent auction at the ACA Summit of Angel Investing, benefiting AIF programming, in addition to the Hold ‘Em or Fold ‘Em Celebration hosted by Rick Timmins. All funds raised at this special event will go to our Foundation, having a direct impact on tomorrow’s leading innovations, products, and services.

Please support our efforts in one of two ways:

Your generosity will be featured on event programming, on our event registration site, and on social media. Gifts are tax deductible to the full extent of the law. EIN 86-1212274. We sincerely appreciate your consideration and time. To participate, or to learn more, please email Development Director Katelynne Staehnke.

Thank You to ACA Business Partners

As we enter a new calendar year, ACA would like to take this opportunity to recognize and thank all our partners for their dedication and commitment to our growing community. These partners offer myriad products and services that can aid in the investor journey be it by group or individual. We hope you will take the opportunity to consider all the possibilities and engage directly with those partners who provide solutions that align with your needs.

If you’re interested in sponsoring ACA annually or for the Summit of Angel Investing, please reach out to Partnerships Director Damien Delgado.