What bank ever refused a Startup if what they are looking for is just banking? And what do startups want with a bank? Are they not capitalized by the VC's?
That was not my argument. I tried to explain for the purposes of banking many alternatives were available. If it's credit they were looking for, banks only lend what you can offer as collateral. Funds come from the VCs.
I feel like there is some disconnect. Maybe I don't understand your question
I was answering why startups need a bank, and it isn't just for loans.
The most basic needs for an account is so that you can 1) store the money you get from VCs, 2) pay your employees, 3) receive payments from customers.
Do you see why a company needs a bank account?
Without a bank you need to operate in cash and have a room somewhere full of physical cash with guards, ect.
> What bank ever refused a Startup if what they are looking for is just banking? And what do startups want with a bank? Are they not capitalized by the VC's?
I do not think I said a company does not need a bank? My comment was in response to the statements trying to imply SVB, was the only option for Startups or that other banks would not accept Startups as clients.
I see, my answer pertains to your 2nd and 3rd question, not the first.
Regarding the first, I am not expert. Many commenters in the various threads have highlighted problems they have had at other banks, such as banks rejecting VC wires or stupid profitability requirements for lines of credit. It mostly sounds like banking SOPs which are incompatible with startups.
It sounds stupid but I have run into similar problems working at large companies trying to partner or buy startups. We want some IP from some small startup and begin financial disclosures. Some idiot in finance runs the numbers and sees the startup is losing $X per year and puts up a red flag on the deal. Like, no shit it is unprofitable, it is a startup and we want their IP.
