Silicon Valley's renowned incubator Y Combinator cuts staff by 20%, denies connection to banking crisis

On 3/14, Silicon Valley's renowned startup accelerator Y Combinator (YC) announced that it is laying off 17 employees, which accounts for 20% of its workforce, in order to focus more on early-stage investments. According to TechCrunch, Y Combinator denied that this decision is related to the recent banking crisis.

Founder: Silicon Valley Bank's Takeover is an Extinction Event for Startups

Last week, Garry Tan, the former CEO, launched a petition to help over 37,000 small businesses affected by the takeover of Silicon Valley Bank. Their deposits exceed the FDIC insurance limit of $250,000, and without government intervention, it would have severe consequences. The petition has garnered signatures from over five thousand founders.

Garry Tan stated on Twitter that the closure of Silicon Valley Bank is an extinction event for startups, setting them back by a decade. Large tech companies won't be affected as they have resources everywhere. However, for these small startups, the "Googles and Facebooks of tomorrow" could face extinction.

By the 13th, the issue was resolved. The U.S. Treasury, Federal Reserve, and FDIC issued a joint statement, allowing depositors to withdraw their full deposits starting Monday, March 13th, with no taxpayer funds used to cover losses related to Silicon Valley Bank.