Connecticut Governor Ned Lamont said he worries the collapse of Silicon Valley Bank could cause a pullback in early stage venture capital, putting a cap on the state’s booming new business figures.
(Bloomberg) — Connecticut Governor Ned Lamont said he worries the collapse of Silicon Valley Bank could cause a pullback in early stage venture capital, putting a cap on the state’s booming new business figures.
“I do worry it’s gonna make banks a lot more cautions around the country and that could impact the economy,” Lamont said in an interview with Bloomberg Radio on Friday. “I think one of the greatest strategic advantages this country has is the liquid capital market and that starts with investment capital, that starts with venture capital and in particular seed capital, which is what we’re doing in this state.”
Silicon Valley Bank’s deposit base was highly concentrated in VC-backed startups and its failure could give lenders pause because making similar bets on unproven businesses. Lamont said the state has created more new businesses in the last three years than the past 23 years combined.
“I really worry about the risk appetite pulling back and part of that is reflected in the nervousness in and around our banking system,” he said. However, he expressed full confidence in the soundness of the state’s banks.
“We follow our banks very closely, we have a good strong relationship there, we know what their asset base is,” he said. “We haven’t seen any ripples.”
–With assistance from Paul Sweeney and John Tucker.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.