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Comment by garry | Hacker News Reader

Many startups chose SVB because they were the ones willing to open a bank account for them at all.

I remember going to a branch of Bank of America to open a bank account for Posterous and not being able to.

So let's get this straight. You want a bank who will take risks willy-nilly on start-ups. But you also want that bank to be subject to regulations to prevent banks from taking risks. But those regulations exist, and SVB begged for exemptions to them, so they could take risks. But your experience with more-regulated banks shows that they're too risk averse. What exactly are you asking for here?

You want your flock made whole. I get that. But are you also asking for regulators to kill the startup economy by shutting it out of banking?

> Many startups chose SVB because they were the ones willing to open a bank account for them at all.

I mean, given the epic scale, herd-mentality of tech startup types to cause a $46 Billion bank run in a singular day (March 9th), can you blame them?

Its clear that other banks have seen systemic risk in focusing on this sector, and are pickier about choosing their customers.

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I get that this is a problem in any case. But the systemic risk / scale associated with the tech startup scene has just been proven to the world. "Other banks didn't want to take $100+ Billions in startup deposits" is beginning to look like the smarter move, given the circumstances.

Now I wonder what is the intersection of those asking for this petition and the ones that organised this bank run... As things might not be so bad if it wasn't organised...

There is no way this is accurate. I've started several bank accounts for the smallest most poorly articulated, poorly documented, businesses you can imagine starting from 18 years old. Never had a problem.

Why? Is that normal in the US? Credit is a different thing (did you need a big overdraft facility?), but here in Australia I can’t imagine that a bank would refuse to open transaction or savings accounts for a legal business… The main exception is a few banks are stopping directly offering products to fossil fuel companies and the like, but that’s it.

>I remember going to a branch of Bank of America to open a bank account for Posterous and not being able to.

I believe you, but this doesn’t make any sense to me. I have opened multiple business accounts at Bank of America. It’s just paperwork. If you have a dollar and a legal entity, you can open a bank account for that entity.

What was the issue?

What? Just about any bank will open a basic small business checking and savings account. It won’t be fancy or high yield but they will bank for you.

Are you really saying BofA would not take deposits for you?

This is not true. I had the same problem with my business at two banks (not BofA). In think it’s related to KYC regulations that makes them cautious. All I wanted was a checking account, no loans.

What’s your take on SVB vs. First Republic?

I think it'd help understand the situation to answer "why not?", and for svb then, "why yes?"

(understanding it may have had little to do with why they tanked)

Was that before you had an account at SVB?

Would BoA have been more willing to open an account for you if your business already had one?

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