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Enterprise Weekly #424: FRB's Downfall, NY Enterprise Tech Meetup on LLMs, and More
April showers may bring May flowers, but unfortunately, May did not bring a brighter horizon for the banking industry.
This week, news hit that First Republic Bank would become the 2nd largest bank failure in U.S. history (notably PacWest also suffered some major down slides this week). After losing $100B in deposits in March’s run, First Republic “limped along” for weeks thanks to a $30B deposit from America’s biggest banks. But ultimately, JPMorgan acquired First Republic in a government auction on Monday.
While it’s somewhat typical for a bigger bank to absorb a smaller, struggling one in a time of crisis, the magnitude of this year’s failures is unprecedented. Combined, First Republic, Silicon Valley Bank and Signature Bank held more in inflation-adjusted assets than the 25 U.S. banks that collapsed in 2008.
As the banking industry constricts, questions emerge: What are the dangers of having banks that are “too big to fail”? But what’s weighing most on startup founders and venture capitalists’ minds is what this all means for the broader tech ecosystem:
What sort of lending will be available to early stage companies, and at what cost? And will bigger and more traditional banks be able to offer the services that VC funds rely on, ranging from capital call lines of credit to streamlined account creation? A lot is in flux right now and we hope to see a resurgence in startup banking with Silicon Valley Bank and First Republic alumni joining larger platforms and spinning up new tech teams.
In more exciting news, we’re hosting our next NY Enterprise Tech Meetup on “LLMs in the Enterprise” on Tuesday, May 16th! A few exciting reasons you should join:
Our panel will dive into the current capabilities of the tech and what the future holds through the lens of two startups, Arthur and MosaicML, as well as the corporate appetite for LLMs with Morgan Stanley and JPMorgan Chase.
We’re selecting three startups to host Startup Lightning Talks. If you’re interested in demoing or providing a quick overview of your AI/ML tech - apply here.
Panelist and Work-Bench portfolio company Arthur just launched Arthur Shield, the first firewall for LLMs. As part of their larger suite of AI monitoring tools, Arthur Shield enables companies to deploy LLM apps, like ChatGPT, more quickly and securely, without exposing their businesses or customers to unnecessary risk. Check out their CEO on Bloomberg TV.
Lastly, for any fashionistas reading, here is Vogue’s list of best dressed at Monday’s Met Gala 💃
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