Erel Margalit: "The collapse of SVB is a warning light for Israel"
Erel Margalit: "The collapse of SVB is a warning light for Israel"
The Founder and Executive Chairman of venture capital fund JVP added: "Every venture capital fund now advises its entrepreneurs to open two accounts in different banks in the US and two accounts in two different banks in Israel"
"The reason that the Israeli companies were able to take their money out of the collapsing SVB is because we communicate and learn. However, the lesson of how a snowball is formed out of a loss of trust in the system must be learned. The Israeli snowball is already rolling because when pilots do not show up for reserve duty, they are essentially withdrawing our money from the bank, only that their currency is goodwill, trust and the spirit of volunteerism," Erel Margalit, Founder and Executive Chairman of the venture capital fund JVP and a former MK from the Labor Party, told Calcalist. "I just returned from the U.S. from a series of meetings with investors and they are also aware of the pilots and understand that if they don't come to serve, they will also take their deposits out of the State of Israel."
Nevertheless, the collapse of SVB, where many Israeli high-tech companies managed their money and to which some of the funds that were withdrawn from Israel over recent weeks were transferred, highlighted the importance and stability of Israeli banks.
"The collapse of SVB is a warning light for Israel and we don't have a strong Minister of Finance to save us. Every venture capital fund now advises its entrepreneurs to open two accounts in different banks in the U.S. and also two accounts in different banks in Israel," noted Margalit. "The Israeli banks are excellent, but you should listen to what the heads of the economic system say in closed meetings: if there is a general loss of confidence in the country, it is more significant than the situation in the account. SVB also had financial strength, but when trust was lost, it had no meaning."
In the meantime, business in Israel is as usual. Your investors also met you and were interested in Israeli companies.
"The investors asked very pointed questions that were made even more relevant as the SVB event intensified. They will not withdraw their investments tomorrow, but on the other hand they are stopping the investments, and as soon as the red line is crossed and there are anti-democratic laws, the countries of the world will lose their confidence in Israel."
