The collapse of Silicon Valley Bank is affecting many Indian startups.

The sudden collapse of the Silicon Valley bank that served as the lifeblood of startups is also affecting firms 8,000 miles away.

Dozens of Indian startups backed by the likes of YC, Accel, Sequoia India, Lightspeed, SoftBank and Bessemer Venture Partners banked with Silicon Valley Bank, sometimes as their sole banking partner, and failed to disburse the funds on time, many people said. He spoke well of the situation.

VCs are wary of disclosing the names of affected startups for fear of affecting young firms’ future capital-raising prospects. Regulators moved in on Friday to close the Silicon Valley bank, the 16th largest in the US and the bank for most startups.

Some Indian companies could not move their money out of Silicon Valley Bank in time because they did not have another US bank account readily available, several venture capitalists said.

Many Indian startups have settled in Delaware to make it easier to raise capital from American venture firms like Y Combinator. Some SaaS companies are registered in the US because they want to serve international markets and be seen as a US-firm even when operating from India.

And Silicon Valley Bank was the preferred choice for many firms that “flipped” their domiciles from India to the US, another person familiar with the matter said, pointing to several events sponsored by SVB.

Almost all Indian SaaS startups with a large presence in the US have banked with Silicon Valley Bank, said one of the investment partners. More than a dozen Indian SaaS unicorns and many other “soonicorns” are headquartered in the US.

Most of these young firms do not distribute their funds to multiple banks because it is often impossible to raise administrative and operational costs in the early days.

A US-based investor, who asked not to be named, said he knows for sure that many Indian companies have around $4-10 million standing in their SVB accounts. YC founders in India polled members about their exposure to SVB and found that more than 60 firms have invested more than $250,000 in SVB, according to results seen by TechCrush.

Indian SaaS startups and otherwise YC-backed companies that set up their companies in the US and raise their offspring there often have SVB as their default bank Ashish Dev, head of Mirae Asset India. He tweeted.. “Certainty is killing them. While the developments are diverse, it is relatively safe.

Y Combinator president Gary Tan said more than 1,000 YC-backed startups were affected by the Silicon Valley bank failure. “30% of YC companies exposed through SVB will not be able to make payroll within the next 30 days,” he tweeted.

The story gets better as we learn more.

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