The sudden collapse of Silicon Valley Bank has put more than a quarter of Roku’s cash at risk. The streaming company held $487 million, representing 26 percent of its cash, in Silicon Valley Bank, the company revealed in a filing with the SEC Friday.
The future of those funds is now uncertain as federal regulators have taken the financial institution in the middle of the second largest bank collapse in the history of the United States. “The Company’s deposits with SVB are largely uninsured,” Roku wrote in his filing. “At this time, the Company does not know to what extent it will be able to recover its cash deposited with SVB.”
In a statement Friday, the Federal Deposit Insurance Corporation (FDIC) said it will pay “uninsured depositors an anticipated dividend within the next week” and that “uninsured depositors will receive a certificate receivership for the remaining amount of your uninsured funds. But there is still a lot of uncertainty about how long that process will take and how much of their uninsured funds the companies will ultimately be able to recover.
However, Roku’s situation is, for now at least, much less dire than many of the smaller startups that depended on Silicon Valley Bank, some of which are now unable to pay your accounts or your employees.
In its SEC filing, the company noted that it has more than $1 billion in cash at many other banks. “As stated in our 8-K, we expect Roku’s ability to operate and meet its contractual obligations will not be affected and we continue to have access to $1.4 billion in cash and cash equivalents that are distributed among multiple large financial institutions. “. a Roku spokesperson said in a statement to Engadget.
While Silicon Valley Bank was previously a little-known institution, it was known for its close relationships with startup founders, who made up much of its clientele. But how Bloomberg’s Matt Levine ExplainThe bank’s reliance on fixed-rate assets also uniquely exposed it to the conditions that ultimately led to a race at the bank on Thursday after prominent venture capitalists urged the founders to get their money out of the institution.
Roku isn’t the only major public tech company now facing losses as a result of the bank’s collapse. Roblox had $3 billion, about 5 percent of its cash, in Silicon Valley Bank, the company said the second. “Regardless of the final outcome and timing, this situation will have no impact on the Company’s day-to-day operations,” he wrote in a document. Vimeo video service too revealed that he had “less than $250,000” with the bank.
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