1 00:00:02,040 --> 00:00:07,160 Speaker 1: This is Mesters in Business with Very Results on Bloomberg Radio. 2 00:00:07,280 --> 00:00:11,600 Speaker 1: Here this week on the podcast, I have an extra 3 00:00:11,680 --> 00:00:18,280 Speaker 1: special guest. If you are at all interested in startups, entrepreneurism, lending, 4 00:00:18,920 --> 00:00:22,919 Speaker 1: risk managements, venture capital, strap yourself in. This is a 5 00:00:22,960 --> 00:00:26,840 Speaker 1: great one. Greg Becker. He's the CEO of Silicon Valley Bank, 6 00:00:27,240 --> 00:00:30,800 Speaker 1: where he's worked since and where he served as president 7 00:00:30,800 --> 00:00:35,160 Speaker 1: and CEO of SVB Financial Group and Silicon Valley Bank 8 00:00:35,600 --> 00:00:38,880 Speaker 1: since two thousand and eleven. This is really a wide 9 00:00:38,960 --> 00:00:42,839 Speaker 1: ranging and fascinating conversation for somebody who is right at 10 00:00:42,920 --> 00:00:47,879 Speaker 1: the nexus of everything from venture capital to life sciences, 11 00:00:48,280 --> 00:00:53,080 Speaker 1: to fintech, to you name it, but from the perspective 12 00:00:53,240 --> 00:00:57,800 Speaker 1: of a commercial banker, really located at the bull's eye 13 00:00:58,080 --> 00:01:01,240 Speaker 1: of the innovation economy, not just in the United States, 14 00:01:01,320 --> 00:01:04,360 Speaker 1: but for the entire world. I found this conversation to 15 00:01:04,360 --> 00:01:08,479 Speaker 1: be absolutely fascinating, and I think you will also, with 16 00:01:08,520 --> 00:01:12,560 Speaker 1: no further ado, my discussion with Silicon Valley Banks CEO 17 00:01:12,880 --> 00:01:19,399 Speaker 1: Greg Becker. This is Mesters in Business with Very Redholts 18 00:01:19,880 --> 00:01:25,920 Speaker 1: on Bloombird Radio. My extra special guest this week is 19 00:01:26,000 --> 00:01:30,080 Speaker 1: Greg Becker. He is the president and CEO of Silicon 20 00:01:30,240 --> 00:01:35,280 Speaker 1: Valley Bank, where he has worked since. Since two thousand 21 00:01:35,319 --> 00:01:38,240 Speaker 1: and eleven, he has been running the place both as 22 00:01:38,319 --> 00:01:43,400 Speaker 1: CEO of SVB Financial Group and Silicon Valley Bank. Greg 23 00:01:43,480 --> 00:01:47,800 Speaker 1: was named to Worth Magazine's Power one hundred most Influential 24 00:01:47,800 --> 00:01:52,840 Speaker 1: People in Global Finance. Greg Becker, Welcome to Bloomberg. Thanks 25 00:01:52,920 --> 00:01:55,480 Speaker 1: very great to be here. It's really great to have 26 00:01:55,560 --> 00:01:58,360 Speaker 1: you here in doing this live in person. So when 27 00:01:58,400 --> 00:02:01,040 Speaker 1: I look at Silicon Valley Bank, the question that comes 28 00:02:01,040 --> 00:02:04,000 Speaker 1: into my head is is this a bank that does 29 00:02:04,040 --> 00:02:07,279 Speaker 1: some venture capital or is this a VC that offers 30 00:02:07,320 --> 00:02:10,960 Speaker 1: some banking services. Well, we are banking, so let's be 31 00:02:11,040 --> 00:02:13,919 Speaker 1: clear about that. We're a bank that caters to a 32 00:02:14,040 --> 00:02:18,400 Speaker 1: very specific industry and then does a lot of things 33 00:02:18,480 --> 00:02:22,280 Speaker 1: to support those companies in those industries. So it's about 34 00:02:22,360 --> 00:02:25,560 Speaker 1: innovation companies all around the world. You start with him 35 00:02:25,639 --> 00:02:29,120 Speaker 1: very early. We support them with commercial banking, private banking, 36 00:02:29,120 --> 00:02:32,880 Speaker 1: and investment banking and asset management, so all those things 37 00:02:32,880 --> 00:02:36,440 Speaker 1: fit together to help these innovation clients. So you've been 38 00:02:36,520 --> 00:02:39,080 Speaker 1: with the bank since ninety three. What was your first 39 00:02:39,200 --> 00:02:42,440 Speaker 1: role there? How did you arrive at Silicon Valley Bank. Yeah, 40 00:02:42,440 --> 00:02:45,600 Speaker 1: so I started out as a loan officer, so lending 41 00:02:45,680 --> 00:02:48,360 Speaker 1: money to companies, and I came from another bank that 42 00:02:48,440 --> 00:02:52,280 Speaker 1: worked with more traditional companies. My manager at the time 43 00:02:52,560 --> 00:02:56,320 Speaker 1: was leaving to join Silicon Valley Bank and he encouraged 44 00:02:56,360 --> 00:02:58,960 Speaker 1: me to join him, and I did, and it was 45 00:02:59,200 --> 00:03:02,200 Speaker 1: phenomenon to an incredible, incredible career. But I started out 46 00:03:02,320 --> 00:03:07,720 Speaker 1: lending money to early stage technology companies at Silicon Valley Bank. 47 00:03:08,840 --> 00:03:11,560 Speaker 1: Now that sounds like a very high risk sort of 48 00:03:11,680 --> 00:03:14,800 Speaker 1: loan that typical banks don't make. How do you go 49 00:03:14,880 --> 00:03:18,680 Speaker 1: about vetting a loan to a company that is brand 50 00:03:18,680 --> 00:03:21,440 Speaker 1: new as a startup, doesn't have a long financial history. 51 00:03:21,919 --> 00:03:25,560 Speaker 1: How does that process differ than traditional bank lending. Yeah, 52 00:03:25,600 --> 00:03:28,000 Speaker 1: well it's changed a lot in twenty eight years. So 53 00:03:28,240 --> 00:03:30,520 Speaker 1: when you think about it, um, way back when when 54 00:03:30,520 --> 00:03:33,000 Speaker 1: I first started, the loans were much smaller. There were 55 00:03:33,240 --> 00:03:36,040 Speaker 1: you know, does not have many these choices for these companies. 56 00:03:36,280 --> 00:03:39,240 Speaker 1: It was really lending money in a very i'll call 57 00:03:39,280 --> 00:03:42,600 Speaker 1: it more conservative way than we do today. And venture capital. 58 00:03:42,600 --> 00:03:45,440 Speaker 1: Those are the two ways that companies were financed. And 59 00:03:45,480 --> 00:03:48,120 Speaker 1: then today, when you think about it, it's all about 60 00:03:48,360 --> 00:03:53,160 Speaker 1: capital debt, lending money. It's about venture capital from all 61 00:03:53,240 --> 00:03:56,240 Speaker 1: different sources and so how you go about lending money 62 00:03:56,280 --> 00:03:59,600 Speaker 1: to these companies is it's really about pattern recognition. It's 63 00:03:59,600 --> 00:04:02,800 Speaker 1: about understanding who the investors are, it's understanding what market 64 00:04:02,800 --> 00:04:05,200 Speaker 1: they're in. There's a whole series of things that we do, 65 00:04:05,560 --> 00:04:07,720 Speaker 1: but we've been doing it for so long and adapting 66 00:04:07,800 --> 00:04:11,640 Speaker 1: this lending capability that we've learned to do it really 67 00:04:11,640 --> 00:04:14,960 Speaker 1: well and both safely but also in a way that 68 00:04:15,080 --> 00:04:17,039 Speaker 1: it's hard for other people who do it. So you're 69 00:04:17,040 --> 00:04:19,599 Speaker 1: there in the nineties, that was quite an exciting period 70 00:04:19,680 --> 00:04:23,040 Speaker 1: when everything was just going up, up up. How did 71 00:04:23,080 --> 00:04:25,400 Speaker 1: you handle the other side of that when when the 72 00:04:25,480 --> 00:04:29,440 Speaker 1: dot COM's imploded? What was the bank doing? How bad 73 00:04:29,480 --> 00:04:31,880 Speaker 1: were losses and how did you manage them? Yes, so 74 00:04:31,880 --> 00:04:35,760 Speaker 1: when I think back at that two thousand two thousand 75 00:04:35,880 --> 00:04:39,359 Speaker 1: one time period, it was such an interesting time, and 76 00:04:39,400 --> 00:04:41,279 Speaker 1: I described it as the highest of highs and the 77 00:04:41,320 --> 00:04:45,440 Speaker 1: lowest of lows. And the beginning of two thousand, everything 78 00:04:45,480 --> 00:04:48,080 Speaker 1: was going well. Everything was going well with our companies. 79 00:04:48,160 --> 00:04:50,440 Speaker 1: They were growing so fast, they were getting started and 80 00:04:50,480 --> 00:04:53,120 Speaker 1: going public within a few years. There was just such 81 00:04:53,160 --> 00:04:56,600 Speaker 1: a euphoria at that time period. And then very quickly, 82 00:04:56,760 --> 00:04:59,280 Speaker 1: kind of March of that year, there was the Baron's 83 00:04:59,400 --> 00:05:01,880 Speaker 1: article that came out, and all of a sudden everything 84 00:05:01,960 --> 00:05:05,000 Speaker 1: changed and it went from everything was going well to 85 00:05:05,279 --> 00:05:09,520 Speaker 1: everything was going poorly. And what was fascinating about that time? 86 00:05:10,040 --> 00:05:12,200 Speaker 1: You know, it's actually my view it's the time when 87 00:05:12,200 --> 00:05:15,279 Speaker 1: you built the best relationships. Going through difficult times with 88 00:05:15,360 --> 00:05:18,560 Speaker 1: venture capitalists and companies. You found out who you were 89 00:05:18,560 --> 00:05:21,039 Speaker 1: as an institution. And so as much as I don't 90 00:05:21,080 --> 00:05:23,200 Speaker 1: want to ever go back to that time period, there 91 00:05:23,200 --> 00:05:25,240 Speaker 1: were a lot of good lessons learned that at that 92 00:05:25,240 --> 00:05:28,279 Speaker 1: time period. But yeah, we took losses. It was challenging 93 00:05:28,320 --> 00:05:30,080 Speaker 1: time for us. It took us a few years to 94 00:05:30,080 --> 00:05:33,120 Speaker 1: get back into what i'll call a nice growth mode 95 00:05:33,160 --> 00:05:35,400 Speaker 1: back in that kind of two thousand three, two thousand four. 96 00:05:35,960 --> 00:05:38,160 Speaker 1: But I look back at it, finally I learned I 97 00:05:38,279 --> 00:05:40,840 Speaker 1: learned a lot about the institution. I learned a lot 98 00:05:40,880 --> 00:05:43,240 Speaker 1: about how to lend money, and I learned learned a 99 00:05:43,240 --> 00:05:45,560 Speaker 1: lot about how to build relationships at that time. And 100 00:05:45,600 --> 00:05:50,800 Speaker 1: if I remember correctly, the the Barons article featured Howard 101 00:05:50,839 --> 00:05:54,919 Speaker 1: Marks and was titled Amazon dot Bomb, is that the 102 00:05:55,160 --> 00:05:58,200 Speaker 1: uh like January two thousand At that way, I couldn't 103 00:05:58,200 --> 00:05:59,800 Speaker 1: remember what month it was. I was either I thought 104 00:05:59,800 --> 00:06:02,320 Speaker 1: it was March, but well Mars was when the pre 105 00:06:02,400 --> 00:06:05,000 Speaker 1: announcements began. I don't remember if it was Intel or 106 00:06:05,080 --> 00:06:08,640 Speaker 1: Dell y t K pulled a lot of tech purchases forward. 107 00:06:09,080 --> 00:06:13,039 Speaker 1: So the first quarter was not surprisingly very light and 108 00:06:13,440 --> 00:06:16,560 Speaker 1: at those high levels didn't take a lot to send 109 00:06:16,600 --> 00:06:19,760 Speaker 1: that boulder down the hill. So so that turned out 110 00:06:19,800 --> 00:06:24,120 Speaker 1: as difficult a period as it was, that turned out 111 00:06:24,120 --> 00:06:26,479 Speaker 1: to be very formative, I don't know if that's the 112 00:06:26,560 --> 00:06:29,839 Speaker 1: right word, but certainly valuable for the bank in its 113 00:06:29,880 --> 00:06:33,680 Speaker 1: relationships with all the various players in Silicon Valley. It's 114 00:06:33,680 --> 00:06:36,920 Speaker 1: the entrepreneurs, it's the vcs. Who else is in that 115 00:06:37,440 --> 00:06:40,200 Speaker 1: ecology that that you had to deal with, Yeah, it's 116 00:06:40,200 --> 00:06:43,440 Speaker 1: all the professional service providers in the innovation business. So 117 00:06:43,480 --> 00:06:45,839 Speaker 1: it's the lawyers, it's the accountants, and it's it's really 118 00:06:45,960 --> 00:06:48,640 Speaker 1: during the difficult times is when you build your reputation, 119 00:06:49,080 --> 00:06:51,320 Speaker 1: and that reputation then is what's going to carry you 120 00:06:51,360 --> 00:06:53,920 Speaker 1: through that next leg of growth. I don't want to 121 00:06:53,920 --> 00:06:56,080 Speaker 1: go back to it. I can't say during the middle 122 00:06:56,120 --> 00:06:59,320 Speaker 1: of it it was enjoyable, but again I do look 123 00:06:59,360 --> 00:07:02,440 Speaker 1: back and say we learned so much and the relationships 124 00:07:02,800 --> 00:07:05,800 Speaker 1: still to this day, are still I look back in 125 00:07:05,920 --> 00:07:08,320 Speaker 1: some of my best relationships in the venture capital community 126 00:07:08,360 --> 00:07:11,320 Speaker 1: were formed back in that time period working through difficult 127 00:07:11,320 --> 00:07:13,720 Speaker 1: situations because you had to you had to work together 128 00:07:13,720 --> 00:07:17,679 Speaker 1: to solve these problems, and it ended up being great 129 00:07:17,760 --> 00:07:20,080 Speaker 1: from my career, ended up being great for the institution. 130 00:07:20,280 --> 00:07:24,360 Speaker 1: When did you see optimism start to return to early 131 00:07:24,440 --> 00:07:29,840 Speaker 1: stage investment post dot com crash? It took a while. 132 00:07:30,680 --> 00:07:33,280 Speaker 1: I took a while. I would say in two thousand 133 00:07:33,440 --> 00:07:36,760 Speaker 1: and three, two thousand four, two thousand and five. It 134 00:07:36,840 --> 00:07:40,120 Speaker 1: was not one thing was really a gradual. Year by 135 00:07:40,200 --> 00:07:42,440 Speaker 1: year it kind of picked up, and I I can 136 00:07:42,520 --> 00:07:46,800 Speaker 1: trust that Versus the financial crisis in oh eight oh nine, 137 00:07:47,320 --> 00:07:51,720 Speaker 1: in the innovation space, there was really only a couple 138 00:07:51,720 --> 00:07:56,240 Speaker 1: of quarters where it took a pretty steep drop and 139 00:07:56,280 --> 00:08:00,280 Speaker 1: then it basically rapidly increased. So two thousand and ten, 140 00:08:00,320 --> 00:08:02,800 Speaker 1: two thousand and eleven, it was a much more steeper 141 00:08:03,160 --> 00:08:06,400 Speaker 1: acceleration than it was back in two thousand two and 142 00:08:06,440 --> 00:08:09,600 Speaker 1: two thousand and three. So I don't think people realized 143 00:08:09,640 --> 00:08:12,680 Speaker 1: that they looked back at that time period that it 144 00:08:12,760 --> 00:08:15,640 Speaker 1: was actually a better time to be investing in. So 145 00:08:16,040 --> 00:08:19,520 Speaker 1: people invested more aggressively in the innovation space back in 146 00:08:19,840 --> 00:08:21,720 Speaker 1: again two thousand and ten and two thousand eleven, and 147 00:08:21,760 --> 00:08:24,040 Speaker 1: I think that was a good lesson. So you mentioned 148 00:08:24,040 --> 00:08:29,400 Speaker 1: the financial crisis of O eight oh nine. Obviously, from 149 00:08:29,560 --> 00:08:33,120 Speaker 1: let's call it March two thousand to either October oh 150 00:08:33,160 --> 00:08:36,280 Speaker 1: two or March oh three, that was very focused on 151 00:08:36,400 --> 00:08:42,160 Speaker 1: technology and telecom. The financial crisis obviously was financially focused, 152 00:08:42,559 --> 00:08:46,679 Speaker 1: but everything froze, credit markets froze, capital flows frozen. How 153 00:08:46,679 --> 00:08:49,480 Speaker 1: did you guys manage through that? What was the impact 154 00:08:49,559 --> 00:08:54,120 Speaker 1: of the financial crisis on the environment in Silicon Valley 155 00:08:54,280 --> 00:08:58,920 Speaker 1: relatively soon after the dot com crashed seven years later. Yeah, 156 00:08:59,280 --> 00:09:02,280 Speaker 1: in the financial crisis, when I think about what happened, 157 00:09:02,400 --> 00:09:05,040 Speaker 1: you know, we were impacted by it, and so we 158 00:09:05,559 --> 00:09:08,680 Speaker 1: really were worried about how deep this was going to 159 00:09:08,760 --> 00:09:10,880 Speaker 1: be and how long it was going to last. And 160 00:09:10,920 --> 00:09:13,079 Speaker 1: so we started, we raised capital, we did a lot 161 00:09:13,120 --> 00:09:16,320 Speaker 1: of things to be as protected as we could if 162 00:09:16,360 --> 00:09:18,840 Speaker 1: this was going to last quite a long period of time. 163 00:09:19,080 --> 00:09:21,800 Speaker 1: But again, what we were surprised by. I was surprised 164 00:09:22,160 --> 00:09:27,120 Speaker 1: by how fast investing in the innovation market picked up, 165 00:09:27,360 --> 00:09:30,800 Speaker 1: how fast venture capital came back, And so we were 166 00:09:30,920 --> 00:09:33,600 Speaker 1: bottoming out venture capital and annual basis was down in 167 00:09:33,600 --> 00:09:37,760 Speaker 1: that kind of twenty billion billion dollars per year. Dropped 168 00:09:37,760 --> 00:09:40,440 Speaker 1: pretty significantly to that level from from what how high 169 00:09:40,520 --> 00:09:45,280 Speaker 1: was it before? The highest amount historically up until the 170 00:09:45,360 --> 00:09:48,319 Speaker 1: last couple of years was a hundred billion dollars invested 171 00:09:48,679 --> 00:09:52,439 Speaker 1: in two thousand. It dropped off dramatically, and then it 172 00:09:52,520 --> 00:09:55,400 Speaker 1: kind of worked its way back up and then dropped 173 00:09:55,440 --> 00:09:58,679 Speaker 1: again in the financial crisis. And since the financial crisis 174 00:09:58,720 --> 00:10:01,520 Speaker 1: it's gone, you know when from the billion dollars in 175 00:10:01,559 --> 00:10:04,559 Speaker 1: the US, and it has been on this steady increase 176 00:10:04,640 --> 00:10:08,920 Speaker 1: in the last few years. Has been truly incredible in comparison, 177 00:10:09,559 --> 00:10:14,600 Speaker 1: last year was a hundred seventy billion dollars and this 178 00:10:14,679 --> 00:10:16,800 Speaker 1: year already the first half the year has been a 179 00:10:16,880 --> 00:10:19,760 Speaker 1: hundred eighty billion dollars in the first half. So this 180 00:10:19,880 --> 00:10:25,440 Speaker 1: year first half, first half, so it's been an incredible 181 00:10:25,559 --> 00:10:28,920 Speaker 1: first half the year. So I've seen people make the 182 00:10:29,000 --> 00:10:32,240 Speaker 1: claim that there's too much money floating around, that oldest 183 00:10:32,280 --> 00:10:37,200 Speaker 1: capital sloshing around, finds its way to companies and ends 184 00:10:37,280 --> 00:10:40,320 Speaker 1: up over paying, and you end up with things like 185 00:10:40,400 --> 00:10:42,880 Speaker 1: we work last year and all the craziness with soft 186 00:10:42,920 --> 00:10:47,000 Speaker 1: bank how do you look at the vast amount of 187 00:10:47,640 --> 00:10:52,480 Speaker 1: investable capital in the system. Have people become too focused 188 00:10:52,480 --> 00:10:55,640 Speaker 1: on on early stage startups or or even pre I 189 00:10:55,679 --> 00:10:58,319 Speaker 1: p O companies. I'm not one of those people, Berry, 190 00:10:58,520 --> 00:11:01,760 Speaker 1: And it says that there's too much, too much liquidity 191 00:11:01,800 --> 00:11:05,360 Speaker 1: out there, And and let me explain why. There's a 192 00:11:05,400 --> 00:11:08,680 Speaker 1: few reasons. One is people look back to two thousand. 193 00:11:08,760 --> 00:11:11,440 Speaker 1: I get that question a fair amount. Why it helped 194 00:11:11,480 --> 00:11:14,560 Speaker 1: me understand why this isn't just a repeat of two thousand. Well, 195 00:11:14,600 --> 00:11:17,520 Speaker 1: when you go back and think about two thousand, I 196 00:11:17,559 --> 00:11:21,439 Speaker 1: would first argue, the size of the market that companies 197 00:11:21,520 --> 00:11:25,880 Speaker 1: are going after is probably I would historically say ten 198 00:11:25,920 --> 00:11:29,439 Speaker 1: times bigger. I would actually say it's more like fifty sixty, 199 00:11:29,679 --> 00:11:33,040 Speaker 1: seventy times bigger than the market was back then. And 200 00:11:33,440 --> 00:11:37,360 Speaker 1: technology is in every part of what our daily lives 201 00:11:37,360 --> 00:11:39,760 Speaker 1: are all about. I would argue, when you think about 202 00:11:39,760 --> 00:11:42,040 Speaker 1: the pandemic and our ability to get through this pandemic 203 00:11:43,040 --> 00:11:46,719 Speaker 1: is a function of technology. So the zoom of the 204 00:11:46,760 --> 00:11:49,079 Speaker 1: world and our ability to work remotely and all the 205 00:11:49,120 --> 00:11:52,120 Speaker 1: different technologies that supported that. But let's also think about 206 00:11:52,160 --> 00:11:55,160 Speaker 1: the healthcare, the vaccines and how rapidly they came to 207 00:11:55,240 --> 00:11:58,600 Speaker 1: market with Madernay and others is because money was put 208 00:11:58,640 --> 00:12:01,839 Speaker 1: into these companies in prior years. So the size of 209 00:12:01,880 --> 00:12:04,920 Speaker 1: the market is much much, much bigger. That's number number one. 210 00:12:05,480 --> 00:12:10,280 Speaker 1: Number two, the markets these companies are going after is 211 00:12:10,400 --> 00:12:14,160 Speaker 1: are so much larger in scale, right it would be 212 00:12:14,559 --> 00:12:18,040 Speaker 1: companies would be building software for industries or for companies 213 00:12:18,480 --> 00:12:22,760 Speaker 1: to sell to industries, and now they're building software to 214 00:12:22,960 --> 00:12:27,320 Speaker 1: attack and completely disrupt entire industries. And you can see 215 00:12:27,320 --> 00:12:30,320 Speaker 1: that in hotels and taxis and all the different industries. 216 00:12:30,360 --> 00:12:32,120 Speaker 1: So the size of the markets much bigger. So I 217 00:12:32,120 --> 00:12:34,560 Speaker 1: look at this and say, billion dollars in the first 218 00:12:34,600 --> 00:12:36,640 Speaker 1: half the year is a big number. I don't want 219 00:12:36,640 --> 00:12:40,360 Speaker 1: to mistake that. But in the whole scheme of global money, 220 00:12:41,080 --> 00:12:44,120 Speaker 1: it's still pretty small. So my view is, um, there's 221 00:12:44,360 --> 00:12:47,200 Speaker 1: the liquidity is is actually okay given the size of 222 00:12:47,200 --> 00:12:50,800 Speaker 1: the market. Let's start right with those two. What is 223 00:12:50,800 --> 00:12:55,680 Speaker 1: the difference between s VB Financial Group and Silicon Valley Bank. 224 00:12:56,400 --> 00:12:58,520 Speaker 1: Not much of a difference. Overall this we have a 225 00:12:58,520 --> 00:13:01,320 Speaker 1: holding company and that's the financial group, and underside the 226 00:13:01,320 --> 00:13:04,880 Speaker 1: holding company we have activities such as investment banking and 227 00:13:04,920 --> 00:13:08,240 Speaker 1: some of the investing that we do in venture capital 228 00:13:08,280 --> 00:13:11,439 Speaker 1: firms and in technology and life science companies. That's done 229 00:13:11,440 --> 00:13:14,680 Speaker 1: at our holding company. And then the bank itself, Silicon 230 00:13:14,800 --> 00:13:18,360 Speaker 1: Valley Bank is nine percent of what we do as 231 00:13:18,400 --> 00:13:21,720 Speaker 1: far as the publicly traded company. So they're very similar. 232 00:13:21,760 --> 00:13:24,640 Speaker 1: It's just what activities fit in which business. And you 233 00:13:24,679 --> 00:13:28,880 Speaker 1: say Silicon Valley Bank, but you're not like a traditional bank. 234 00:13:29,040 --> 00:13:33,000 Speaker 1: We were just talking about branches and tellers and things 235 00:13:33,040 --> 00:13:36,000 Speaker 1: like that. That's not the sort of storefront you operate, 236 00:13:36,120 --> 00:13:39,600 Speaker 1: is it. Now. We are a commercial bank predominantly, and 237 00:13:39,640 --> 00:13:42,800 Speaker 1: that means that we work with companies. So companies again, 238 00:13:43,160 --> 00:13:46,800 Speaker 1: you know, it's the startups that are being funded by 239 00:13:47,000 --> 00:13:49,880 Speaker 1: families and friends. You know, people have ideas and they're 240 00:13:49,920 --> 00:13:53,559 Speaker 1: raising fifty a hundred thousand dollars and they're starting in business. 241 00:13:53,600 --> 00:13:56,160 Speaker 1: But they're starting a business that is in software or 242 00:13:56,200 --> 00:13:59,840 Speaker 1: the internet or in e commerce. It's in those industries 243 00:14:00,120 --> 00:14:02,800 Speaker 1: we we support, and that's the business side of it, 244 00:14:03,040 --> 00:14:05,199 Speaker 1: and we grow with them as they get larger and larger, 245 00:14:05,200 --> 00:14:07,720 Speaker 1: and hopefully they go public they get larger lists on 246 00:14:07,760 --> 00:14:09,400 Speaker 1: a NASADAC or they get listed on the New York 247 00:14:09,400 --> 00:14:13,120 Speaker 1: Stock Exchange. That's our models. So we don't have tellers, 248 00:14:13,320 --> 00:14:15,920 Speaker 1: we don't have branches, because so much of this can 249 00:14:15,960 --> 00:14:19,240 Speaker 1: be done virtually. And so when again, it helps when 250 00:14:19,560 --> 00:14:22,080 Speaker 1: you know, when you have a tragedy like the pandemic occurring, 251 00:14:22,320 --> 00:14:24,360 Speaker 1: you know we can still operate exactly as we had 252 00:14:24,400 --> 00:14:29,480 Speaker 1: operated historically. So I noticed you sort of funds companies 253 00:14:29,520 --> 00:14:34,080 Speaker 1: and bank with companies at different phases of their lifespan 254 00:14:34,680 --> 00:14:38,320 Speaker 1: startup banking, venture funded, late stage. Let's let's start up 255 00:14:38,320 --> 00:14:43,080 Speaker 1: with what is SVB startup banking. Yeah, So weave it 256 00:14:43,080 --> 00:14:45,880 Speaker 1: into our strategy overall because I think it's helpful in context. 257 00:14:46,360 --> 00:14:50,080 Speaker 1: Our strategy is we want to bring companies in that 258 00:14:50,120 --> 00:14:52,720 Speaker 1: are just getting started. So think about it like the 259 00:14:52,760 --> 00:14:55,080 Speaker 1: top of the funnel. You want to bring in thousands 260 00:14:55,080 --> 00:14:58,760 Speaker 1: of new companies each year, new companies that are being formed, 261 00:14:58,800 --> 00:15:01,960 Speaker 1: and we're talking about six, seven, eight nine thousand new 262 00:15:02,000 --> 00:15:05,920 Speaker 1: companies per year. We support them with banking services, getting 263 00:15:05,920 --> 00:15:08,480 Speaker 1: them off the ground, give them an advice, making connections 264 00:15:08,480 --> 00:15:11,760 Speaker 1: to investors, making connections to their service providers, and then 265 00:15:11,800 --> 00:15:14,160 Speaker 1: we tailor our products to them. As they raise their 266 00:15:14,160 --> 00:15:17,040 Speaker 1: first round of venture capital financing, their second round of 267 00:15:17,320 --> 00:15:19,960 Speaker 1: venture capital financing. We're lending them money in unique ways. 268 00:15:20,680 --> 00:15:25,400 Speaker 1: Ventured debt could be acquisition financing all different products and services, 269 00:15:25,440 --> 00:15:29,120 Speaker 1: giving them FX capabilities as they go international. And then 270 00:15:29,160 --> 00:15:32,120 Speaker 1: we support them with even greater capabilities as they go 271 00:15:32,240 --> 00:15:35,560 Speaker 1: international and they go public and they're doing hundreds of 272 00:15:35,560 --> 00:15:38,520 Speaker 1: millions of dollars of revenue. And so our our strategy 273 00:15:38,560 --> 00:15:42,040 Speaker 1: is bring them in early and support them all throughout 274 00:15:42,040 --> 00:15:45,280 Speaker 1: their life cycle as they get larger and larger. That's, 275 00:15:45,440 --> 00:15:48,520 Speaker 1: in a in a nutshell, that's what our our strategy is. 276 00:15:48,560 --> 00:15:50,720 Speaker 1: And to do it not just in the US, but 277 00:15:50,840 --> 00:15:52,880 Speaker 1: to do it globally, to do it in the UK, 278 00:15:53,080 --> 00:15:54,920 Speaker 1: to do in Europe, to do it in China, to 279 00:15:54,920 --> 00:15:57,200 Speaker 1: do it in Canada. And that's what we got to do. 280 00:15:57,280 --> 00:16:00,160 Speaker 1: Work with the most innovative, the coolest companies in the 281 00:16:00,280 --> 00:16:03,400 Speaker 1: entire world. So let's let's put some numbers on that 282 00:16:05,160 --> 00:16:08,320 Speaker 1: of venture backed tech and life sciences company in the 283 00:16:08,440 --> 00:16:11,920 Speaker 1: US Bank with you. That's a tremendous number. And then 284 00:16:11,960 --> 00:16:15,000 Speaker 1: if we talk about those same sort of companies that 285 00:16:15,400 --> 00:16:21,080 Speaker 1: have gone I p O of them in bank with you. So, 286 00:16:21,080 --> 00:16:24,800 Speaker 1: so you guys really seem to have cornered this market. 287 00:16:25,800 --> 00:16:29,920 Speaker 1: What are you doing to protect that giant lead? Yeah, 288 00:16:30,040 --> 00:16:33,560 Speaker 1: I definitely don't like the description cornered because that implies 289 00:16:33,600 --> 00:16:35,760 Speaker 1: in some ways that there isn't competition and you don't 290 00:16:35,760 --> 00:16:37,640 Speaker 1: have to wake up every day and kind of Andrew 291 00:16:37,680 --> 00:16:40,760 Speaker 1: Groves quote only the paranoid survive, which is something we 292 00:16:40,880 --> 00:16:45,360 Speaker 1: certainly adhere to. You know, it starts with really being 293 00:16:45,480 --> 00:16:51,080 Speaker 1: relentlessly focused on helping these companies at all stages figuring 294 00:16:51,120 --> 00:16:53,920 Speaker 1: out what are the keys to their success. What I 295 00:16:54,160 --> 00:16:56,480 Speaker 1: was talked to our team about, it's that one piece 296 00:16:56,480 --> 00:17:00,800 Speaker 1: of advice, It's that one connection, It's that one piece 297 00:17:00,840 --> 00:17:04,040 Speaker 1: of help that can make the difference between a company 298 00:17:04,080 --> 00:17:08,000 Speaker 1: being successful and not being successful. And you have to 299 00:17:08,000 --> 00:17:11,480 Speaker 1: think about that every single day. Is you engage with 300 00:17:11,680 --> 00:17:15,639 Speaker 1: and you work with our clients. And it makes sense 301 00:17:15,680 --> 00:17:18,159 Speaker 1: that when you have teams of people at SVB, that 302 00:17:18,280 --> 00:17:20,600 Speaker 1: this is all they do, work with companies that are 303 00:17:20,640 --> 00:17:25,760 Speaker 1: in the healthcare industry, biotech companies or medical devices, or 304 00:17:25,960 --> 00:17:29,000 Speaker 1: software or cyber software. That if they do that all 305 00:17:29,080 --> 00:17:32,080 Speaker 1: day long and the next cybersecurity software walks in the door, 306 00:17:32,119 --> 00:17:34,240 Speaker 1: their ability to point them in the right direction to 307 00:17:34,280 --> 00:17:38,359 Speaker 1: make interactions or engagements or connections that makes such a 308 00:17:38,440 --> 00:17:40,920 Speaker 1: huge difference. And so we just have to keep thinking 309 00:17:40,920 --> 00:17:44,640 Speaker 1: about that every single day, and that's you know, differentiating 310 00:17:45,000 --> 00:17:47,639 Speaker 1: and it's also what's really a lot of fun. If 311 00:17:47,680 --> 00:17:50,240 Speaker 1: you believe you have helped a company, you go home 312 00:17:50,280 --> 00:17:53,000 Speaker 1: at night you feel pretty darn good that you've made 313 00:17:53,040 --> 00:17:57,040 Speaker 1: a difference in a company that's changing something significant in 314 00:17:57,080 --> 00:18:01,400 Speaker 1: the world, very impressive. Let's talk about later stage companies 315 00:18:01,400 --> 00:18:05,520 Speaker 1: and public companies. Do you offer a similar suite of 316 00:18:05,560 --> 00:18:09,000 Speaker 1: services and and how different is that from the very 317 00:18:09,000 --> 00:18:12,119 Speaker 1: early stage compan Yeah, it is, it is very different, um, 318 00:18:12,160 --> 00:18:15,560 Speaker 1: but it is still again in that same commentary about 319 00:18:15,600 --> 00:18:19,000 Speaker 1: helping them be successful, that's what the product said, is 320 00:18:19,040 --> 00:18:21,440 Speaker 1: that's what the solutions are. That's where all the advice 321 00:18:21,840 --> 00:18:25,240 Speaker 1: and connections. So we may bring, um, some CFOs together 322 00:18:25,359 --> 00:18:27,240 Speaker 1: or ceo s together. If a company is thinking about 323 00:18:27,280 --> 00:18:30,240 Speaker 1: going public, well let's connect them with other c e 324 00:18:30,359 --> 00:18:32,359 Speaker 1: o s who have gone through that process so they 325 00:18:32,359 --> 00:18:35,080 Speaker 1: can get the advice about how to do that. Do 326 00:18:35,119 --> 00:18:37,320 Speaker 1: you raise money before you go public or do you 327 00:18:37,400 --> 00:18:39,520 Speaker 1: raise kind of all the money you need when you 328 00:18:39,560 --> 00:18:42,800 Speaker 1: go public or after you go public? Giving that feedback 329 00:18:42,840 --> 00:18:46,200 Speaker 1: and that experience to other people going through that same thing, 330 00:18:46,520 --> 00:18:49,640 Speaker 1: those connections are really, really, really valuable. But other things 331 00:18:49,680 --> 00:18:51,920 Speaker 1: that are different, how much money you lend to them, 332 00:18:51,920 --> 00:18:54,600 Speaker 1: the type of money it's acquisition financing. It could be 333 00:18:54,680 --> 00:18:58,280 Speaker 1: large acquisition financing, it could be making introductions to pe 334 00:18:58,320 --> 00:19:02,120 Speaker 1: firms who may want to take them private if they're 335 00:19:02,160 --> 00:19:05,240 Speaker 1: public already. So it's a whole suite of solutions that 336 00:19:05,280 --> 00:19:07,560 Speaker 1: we give to these companies. And again I'll go back 337 00:19:07,560 --> 00:19:09,560 Speaker 1: to what I said, that's the most important, that's the 338 00:19:09,560 --> 00:19:12,280 Speaker 1: most fun part when you really do believe that you've 339 00:19:12,320 --> 00:19:15,280 Speaker 1: made a difference in that company. Very interesting. Tell us 340 00:19:15,280 --> 00:19:18,000 Speaker 1: a little bit about open Door. I love the story 341 00:19:18,119 --> 00:19:22,040 Speaker 1: that everybody passed on them. What did you guys see 342 00:19:22,080 --> 00:19:25,040 Speaker 1: in them? That was so unique? Part of companies like 343 00:19:25,080 --> 00:19:27,560 Speaker 1: an open door. And there's such a long list of 344 00:19:27,600 --> 00:19:29,439 Speaker 1: companies that you put it, you know, put in that 345 00:19:29,520 --> 00:19:33,560 Speaker 1: list that I think the biggest challenge for individuals to 346 00:19:33,600 --> 00:19:37,520 Speaker 1: look at these companies and to really believe in them 347 00:19:37,760 --> 00:19:41,560 Speaker 1: is to understand what they're going after. And it's very 348 00:19:41,600 --> 00:19:44,040 Speaker 1: easy to say no, It's very easy to list all 349 00:19:44,080 --> 00:19:47,080 Speaker 1: the challenges and the reasons that something may not work. 350 00:19:47,520 --> 00:19:50,760 Speaker 1: It is much more difficult to be that optimistic point 351 00:19:50,760 --> 00:19:53,480 Speaker 1: of view and to say what if, what if they're successful? 352 00:19:53,480 --> 00:19:55,840 Speaker 1: What if they're right, What if they actually go after 353 00:19:55,880 --> 00:19:58,920 Speaker 1: this market? How big could this be? And then understanding 354 00:19:59,400 --> 00:20:02,800 Speaker 1: again who investors are, understanding the management team and there 355 00:20:03,000 --> 00:20:06,240 Speaker 1: and their dry for success. All those things are ingredients 356 00:20:06,600 --> 00:20:09,000 Speaker 1: that really gives you that view of the potential for 357 00:20:09,040 --> 00:20:12,080 Speaker 1: that business. And that that's what I mean, Honestly, that's 358 00:20:12,359 --> 00:20:15,280 Speaker 1: the most inspiring part of what I get to do 359 00:20:15,320 --> 00:20:19,000 Speaker 1: as a CEO to see these companies, to understand where 360 00:20:19,000 --> 00:20:21,920 Speaker 1: they're going, to listen to the CEOs and the c 361 00:20:22,119 --> 00:20:24,119 Speaker 1: suites in these companies, to see where they want to go, 362 00:20:24,200 --> 00:20:25,720 Speaker 1: where they want to go and what they want to build. 363 00:20:26,080 --> 00:20:30,199 Speaker 1: UM is truly incredible And that's that's incredibly motivating to me, 364 00:20:30,280 --> 00:20:32,480 Speaker 1: and I know it's incredibly motivating to our team. So 365 00:20:32,480 --> 00:20:36,440 Speaker 1: so let's stick with that. And before we describe how 366 00:20:36,480 --> 00:20:40,960 Speaker 1: the open door investment worked out, people should be aware 367 00:20:41,119 --> 00:20:45,000 Speaker 1: that the vast majority of venture investments don't pan out. 368 00:20:45,520 --> 00:20:49,000 Speaker 1: This is a space where somewhere between sixty the companies 369 00:20:49,640 --> 00:20:52,239 Speaker 1: UM never really get off the ground in in an 370 00:20:52,240 --> 00:20:55,239 Speaker 1: appreciable way. How do you manage that risk and how 371 00:20:55,240 --> 00:20:58,560 Speaker 1: do you make sure that whatever that relationship is, you're 372 00:20:58,600 --> 00:21:02,239 Speaker 1: not just burning through She at a horrifying rate. So 373 00:21:02,280 --> 00:21:06,000 Speaker 1: there's the investment piece of these companies, and then there's 374 00:21:06,040 --> 00:21:10,560 Speaker 1: the lending money to these companies. So the investing piece 375 00:21:10,800 --> 00:21:15,040 Speaker 1: is you you have to have a few winners to 376 00:21:15,200 --> 00:21:19,360 Speaker 1: make up for all the companies where they don't. They 377 00:21:19,400 --> 00:21:23,520 Speaker 1: don't either realize their full potential or they outright fail. 378 00:21:24,160 --> 00:21:28,200 Speaker 1: So equity is very different than lending money. Lending money, 379 00:21:28,720 --> 00:21:31,520 Speaker 1: you don't have to have as many winners to make 380 00:21:31,600 --> 00:21:33,520 Speaker 1: up for the for the ones you lose money on, 381 00:21:33,640 --> 00:21:36,720 Speaker 1: you do have a higher loss rate um, but because 382 00:21:37,200 --> 00:21:40,400 Speaker 1: we as a senior lender in these loans, we get 383 00:21:40,440 --> 00:21:43,480 Speaker 1: repaid first when you when a company goes out of business, 384 00:21:43,560 --> 00:21:46,360 Speaker 1: we get repaid as the company's winding down. That has 385 00:21:46,400 --> 00:21:49,719 Speaker 1: certain protections to us. So loss rates are still higher, 386 00:21:50,080 --> 00:21:52,439 Speaker 1: but you can still underwrite them in a way that 387 00:21:52,600 --> 00:21:55,960 Speaker 1: is different than the equity investors do. We don't have 388 00:21:56,000 --> 00:21:58,080 Speaker 1: the same upside and we don't have the same downside. 389 00:21:58,640 --> 00:22:02,280 Speaker 1: On the lending side, if something doesn't work out and 390 00:22:02,320 --> 00:22:05,960 Speaker 1: you're recapturing eight of the loan, that's a loss, but 391 00:22:06,080 --> 00:22:09,200 Speaker 1: it's not a total right. You're not writing everything off 392 00:22:09,320 --> 00:22:11,280 Speaker 1: right on the equity side, if it doesn't work out, 393 00:22:11,440 --> 00:22:14,320 Speaker 1: that's take it down to zero. It usually means that 394 00:22:14,320 --> 00:22:15,840 Speaker 1: you're gonna take it down to zero, you're gonna take 395 00:22:15,840 --> 00:22:17,760 Speaker 1: a complete loss. Yes, And at the end of the 396 00:22:17,800 --> 00:22:20,840 Speaker 1: open Door investment, you guys were the only ones who 397 00:22:21,119 --> 00:22:24,560 Speaker 1: were willing to make that equity investment in open door, 398 00:22:25,119 --> 00:22:27,959 Speaker 1: and ultimately they end up going public with a spack. 399 00:22:28,480 --> 00:22:31,879 Speaker 1: It's a giant winner for everybody involved. That has to 400 00:22:32,000 --> 00:22:35,120 Speaker 1: give you a lot of confidence that, Hey, our due 401 00:22:35,160 --> 00:22:39,120 Speaker 1: diligence process and our ability to both lend and make 402 00:22:39,160 --> 00:22:43,000 Speaker 1: equity investments seems to be finding the right companies. So 403 00:22:43,040 --> 00:22:44,880 Speaker 1: the equity investors in that deal, we weren't the only 404 00:22:44,920 --> 00:22:47,600 Speaker 1: equity were the only investor. In fact, we were lending 405 00:22:47,640 --> 00:22:50,560 Speaker 1: money to them. But the equity investors did very well. 406 00:22:50,920 --> 00:22:53,200 Speaker 1: Don't you get warrants on a lot of these small 407 00:22:53,240 --> 00:22:56,720 Speaker 1: companies when you're one of the early investors as well. Yeah, 408 00:22:56,760 --> 00:22:59,960 Speaker 1: but it's it uries a really interesting distinction between equity 409 00:23:00,080 --> 00:23:03,840 Speaker 1: investing where you get, um, you're putting in tens of 410 00:23:03,880 --> 00:23:08,960 Speaker 1: millions of dollars and you're getting right when you're lending money. 411 00:23:09,280 --> 00:23:12,400 Speaker 1: Think about it almost like getting a few stock options. 412 00:23:13,040 --> 00:23:15,640 Speaker 1: So for the upside, it offsets some of the losses 413 00:23:15,680 --> 00:23:18,320 Speaker 1: that you will take over time in the portfolio. But 414 00:23:18,720 --> 00:23:23,000 Speaker 1: it's it's mainly it's a small amount of stock. When 415 00:23:23,000 --> 00:23:25,760 Speaker 1: a company is really successful, though it can still add 416 00:23:25,800 --> 00:23:27,479 Speaker 1: up to a lot of a lot of money, and 417 00:23:27,520 --> 00:23:30,560 Speaker 1: so we've seen that especially last year and this year. 418 00:23:30,680 --> 00:23:33,480 Speaker 1: The warrant gains that we've had have been substantial. But 419 00:23:33,520 --> 00:23:36,280 Speaker 1: the reason it's more challenging is that when things are 420 00:23:36,280 --> 00:23:39,840 Speaker 1: going really well, you have really low credit losses and 421 00:23:39,880 --> 00:23:43,320 Speaker 1: your warrant gains are also doing really well, it looks 422 00:23:43,359 --> 00:23:46,919 Speaker 1: really easy. When the markets more challenging, your warrant gains 423 00:23:47,560 --> 00:23:50,240 Speaker 1: are non existent. You could be even losing money on 424 00:23:50,280 --> 00:23:52,639 Speaker 1: your warrants right and you could be having a higher 425 00:23:52,720 --> 00:23:56,280 Speaker 1: rite off rate. So it is it is more cyclical 426 00:23:56,560 --> 00:23:59,639 Speaker 1: up and down than people would believe. So you you 427 00:23:59,720 --> 00:24:02,280 Speaker 1: really have to think about this under a long term strategy. 428 00:24:02,800 --> 00:24:06,200 Speaker 1: Companies these days are staying private for much longer. Tell 429 00:24:06,280 --> 00:24:09,119 Speaker 1: us a little bit about your partnership with NASDAK to 430 00:24:09,160 --> 00:24:13,440 Speaker 1: help bring some liquidity to pre I p O startups. 431 00:24:13,960 --> 00:24:15,680 Speaker 1: Let me give a little more context to be able 432 00:24:15,680 --> 00:24:19,320 Speaker 1: to answer the question better. Um, So, the big difference 433 00:24:19,359 --> 00:24:24,399 Speaker 1: between private companies and public companies is access to information. 434 00:24:24,680 --> 00:24:27,679 Speaker 1: They are. They're very very very very different as far 435 00:24:27,680 --> 00:24:30,280 Speaker 1: as what is known about a private company and what's 436 00:24:30,280 --> 00:24:32,280 Speaker 1: not about a public company. Public companies you know all 437 00:24:32,280 --> 00:24:34,719 Speaker 1: the information, it's all you know. We all have access 438 00:24:34,720 --> 00:24:37,760 Speaker 1: to the same information and knowledge. Um it's you know, 439 00:24:38,440 --> 00:24:43,119 Speaker 1: very small margins on trading and all those things. Private companies, 440 00:24:43,359 --> 00:24:48,160 Speaker 1: by definition, it's more opaque. It's more unknown about their 441 00:24:48,160 --> 00:24:52,200 Speaker 1: financials and what's going on. So buying and selling private stock, 442 00:24:52,240 --> 00:24:55,880 Speaker 1: if you could even find some, has been a historical challenge. 443 00:24:56,760 --> 00:25:00,520 Speaker 1: What happens is the companies stay private longer. Right, The 444 00:25:00,600 --> 00:25:03,479 Speaker 1: issue for investors, the issues for the employees that are 445 00:25:03,520 --> 00:25:06,719 Speaker 1: part of that company. You may have made on paper 446 00:25:06,800 --> 00:25:08,960 Speaker 1: a lot of money, but you may not be able 447 00:25:09,000 --> 00:25:11,320 Speaker 1: to get any liquidity, and so you have to figure 448 00:25:11,320 --> 00:25:14,840 Speaker 1: out a way how can you keep these companies private 449 00:25:14,880 --> 00:25:18,280 Speaker 1: longer to build additional wealth and still provide liquidity to 450 00:25:18,320 --> 00:25:21,760 Speaker 1: the investors and still probably liquidity to the employees. One 451 00:25:21,760 --> 00:25:24,560 Speaker 1: way to do it is to create an exchange in 452 00:25:24,680 --> 00:25:28,679 Speaker 1: exchange for private company shares, and that's what Nastick Private 453 00:25:28,680 --> 00:25:31,320 Speaker 1: Market has been doing. Historically, they've done more than thirty 454 00:25:31,359 --> 00:25:36,119 Speaker 1: billion dollars of trading in private shares and what we 455 00:25:36,200 --> 00:25:39,680 Speaker 1: wanted to do pulling together this group. So it's Nasdeck, 456 00:25:39,960 --> 00:25:44,800 Speaker 1: it's ourselves, it's Goldman, Morgan, Stanley, and City is basically 457 00:25:44,880 --> 00:25:48,320 Speaker 1: a consortium that comes together that all brings something valuable 458 00:25:48,760 --> 00:25:53,960 Speaker 1: to create a private exchange that is bigger, bolder, is 459 00:25:54,040 --> 00:25:58,520 Speaker 1: more accessible to investors on the issuer side and on 460 00:25:58,560 --> 00:26:00,600 Speaker 1: the investors side. And that's really what this is about, 461 00:26:00,600 --> 00:26:03,440 Speaker 1: and that's why we're excited to be working together. So 462 00:26:03,640 --> 00:26:06,960 Speaker 1: obviously it's a private exchange. It's not open to the public. 463 00:26:07,600 --> 00:26:09,800 Speaker 1: How big of a market is this? How big can 464 00:26:09,840 --> 00:26:13,439 Speaker 1: it get? And who are the buyers and sellers in 465 00:26:13,520 --> 00:26:17,800 Speaker 1: this private market? These sellers are the issuers are really 466 00:26:18,160 --> 00:26:22,600 Speaker 1: the vast majority of private companies that have raised maybe 467 00:26:22,640 --> 00:26:26,959 Speaker 1: it's a series C round D round, so they're they're 468 00:26:27,000 --> 00:26:30,800 Speaker 1: more mature. They may be doing fifty million, two hundred 469 00:26:30,840 --> 00:26:33,720 Speaker 1: million dollars in revenue right um, and so they may 470 00:26:33,720 --> 00:26:39,120 Speaker 1: be two, three, four years away from going public. And 471 00:26:39,359 --> 00:26:41,600 Speaker 1: those companies wanted, you know, maybe they've been around for 472 00:26:41,640 --> 00:26:43,760 Speaker 1: eight years, nine years, ten years, so they want to 473 00:26:43,760 --> 00:26:48,280 Speaker 1: provide liquidity for early investors or for employees. So there's 474 00:26:48,320 --> 00:26:51,240 Speaker 1: the issue where side of it. So it's a big market. 475 00:26:51,280 --> 00:26:53,960 Speaker 1: The issue where a side is a big market. On 476 00:26:54,000 --> 00:26:57,320 Speaker 1: the other side is the buyers, right, So the investors, 477 00:26:57,359 --> 00:26:59,840 Speaker 1: it will mostly be the institutional and mostly be the 478 00:27:00,000 --> 00:27:03,440 Speaker 1: ones who are maybe coming into invest in these businesses 479 00:27:03,760 --> 00:27:07,080 Speaker 1: once they become public and they want to participate two 480 00:27:07,160 --> 00:27:11,119 Speaker 1: or three years earlier while they're still private. So a 481 00:27:11,119 --> 00:27:13,520 Speaker 1: lot of the investors will be the same investors. But 482 00:27:13,600 --> 00:27:17,040 Speaker 1: you can see family offices, you could see some accredited 483 00:27:17,080 --> 00:27:20,240 Speaker 1: investors participating in that. And so it is a big 484 00:27:20,280 --> 00:27:22,800 Speaker 1: market on both sides, and that's why we were excited 485 00:27:22,800 --> 00:27:26,359 Speaker 1: to participate um in this new joint venture with Nasdak 486 00:27:26,440 --> 00:27:29,520 Speaker 1: and the other investment banks. And the assumption is when 487 00:27:29,560 --> 00:27:32,320 Speaker 1: you're buying pre i p O shares, you're getting a 488 00:27:32,359 --> 00:27:35,880 Speaker 1: discount from not only a couple of years of growth, 489 00:27:36,280 --> 00:27:39,280 Speaker 1: but what the I p O valuation might be. It depends. 490 00:27:39,320 --> 00:27:42,240 Speaker 1: Sometimes you'll be getting a discount and sometimes the valuation 491 00:27:42,560 --> 00:27:44,840 Speaker 1: may go the other way. Right. It's just when people 492 00:27:44,880 --> 00:27:47,520 Speaker 1: ask me the question about it almost makes it seem 493 00:27:47,560 --> 00:27:51,160 Speaker 1: like you're guaranteed to make money because you're investing before 494 00:27:51,160 --> 00:27:55,320 Speaker 1: a company goes public, and obviously or guarantee is always 495 00:27:55,359 --> 00:27:57,960 Speaker 1: so loaded. Yeah, it's so it just doesn't work that way, right, 496 00:27:58,040 --> 00:27:59,879 Speaker 1: It's but it's like when you buy a public stock. 497 00:28:00,080 --> 00:28:02,159 Speaker 1: When you buy a public stock, you make an assumption 498 00:28:02,640 --> 00:28:05,159 Speaker 1: about that stock. You believe it has upside and it 499 00:28:05,160 --> 00:28:07,960 Speaker 1: will go up. Every stock that you invest in Bury 500 00:28:08,040 --> 00:28:11,240 Speaker 1: does it always go up? Is every single but not 501 00:28:10,920 --> 00:28:14,720 Speaker 1: for the average actually actually for everybody for the past 502 00:28:14,800 --> 00:28:18,760 Speaker 1: couple of years, it's gone up. But that's not what 503 00:28:18,880 --> 00:28:21,639 Speaker 1: happens in the real world over longer periods of time. 504 00:28:21,920 --> 00:28:24,000 Speaker 1: And look, it was only a year ago we watched 505 00:28:24,040 --> 00:28:31,200 Speaker 1: we Work implode after a pretty rich uprounds. So maybe 506 00:28:31,280 --> 00:28:34,359 Speaker 1: it's not that extreme of an example, but there's no 507 00:28:34,440 --> 00:28:38,000 Speaker 1: reason to think that a successful C round or D 508 00:28:38,200 --> 00:28:41,560 Speaker 1: round company can have things go off the rails and 509 00:28:41,640 --> 00:28:44,000 Speaker 1: the next round is appreciably lower. You asked me a 510 00:28:44,080 --> 00:28:46,960 Speaker 1: question earlier in the discussion about you know, how do 511 00:28:47,000 --> 00:28:49,960 Speaker 1: we deal with this high loss rate? Remember, I mean, 512 00:28:50,120 --> 00:28:52,520 Speaker 1: even if they get to a later stage, a series 513 00:28:52,560 --> 00:28:55,600 Speaker 1: C or D round, and they are doing fifty million 514 00:28:55,600 --> 00:28:59,040 Speaker 1: dollars in revenue, it doesn't mean they may not struggle. 515 00:28:59,120 --> 00:29:01,800 Speaker 1: It doesn't mean that there they may not go out 516 00:29:01,800 --> 00:29:03,640 Speaker 1: of business. They still may go out of business. So 517 00:29:03,960 --> 00:29:06,120 Speaker 1: it's still it's a higher risk. You're just trying to 518 00:29:06,120 --> 00:29:11,640 Speaker 1: give information and accessibility to these private companies so people 519 00:29:11,680 --> 00:29:15,600 Speaker 1: can participate in it, institutions and individuals, and that's what's 520 00:29:15,680 --> 00:29:18,160 Speaker 1: unique about it and that's what we're excited about. So, 521 00:29:18,160 --> 00:29:22,920 Speaker 1: so you mentioned how much information is available for public companies. 522 00:29:23,840 --> 00:29:26,720 Speaker 1: How do you go about doing your due diligence on 523 00:29:26,840 --> 00:29:30,920 Speaker 1: private companies where you can't just sit at a Bloomberg 524 00:29:31,000 --> 00:29:34,200 Speaker 1: terminal or punch something into Google and find everything there 525 00:29:34,320 --> 00:29:36,840 Speaker 1: is to find out about a company. What is that 526 00:29:36,920 --> 00:29:41,040 Speaker 1: process like and how much energy and time and capital 527 00:29:41,080 --> 00:29:43,360 Speaker 1: do you invest in it? Yeah, well, it is a 528 00:29:43,400 --> 00:29:45,120 Speaker 1: function of a couple things, right. One is has to 529 00:29:45,120 --> 00:29:48,360 Speaker 1: be the private company and what they're willing to share, 530 00:29:49,040 --> 00:29:52,440 Speaker 1: and then the buyer takes that information and they marry 531 00:29:52,440 --> 00:29:55,200 Speaker 1: it with any comparables that you can make in the 532 00:29:55,240 --> 00:29:58,400 Speaker 1: public market, and then you make assumptions. Right, That's why 533 00:29:58,440 --> 00:30:00,720 Speaker 1: it's it is more difficult. Right, it will not be 534 00:30:00,960 --> 00:30:07,840 Speaker 1: ever be as transparent, as clear and with information accessible 535 00:30:08,280 --> 00:30:09,880 Speaker 1: the way a public market is. That's why that is 536 00:30:09,880 --> 00:30:12,440 Speaker 1: still a private market. But you should be able to 537 00:30:12,480 --> 00:30:14,719 Speaker 1: make certain assumptions. So let's say if it's as sassed 538 00:30:15,080 --> 00:30:19,560 Speaker 1: assass enterprise software company. Well, even if it's private, you 539 00:30:19,640 --> 00:30:23,320 Speaker 1: have public comps that you then can apply based on 540 00:30:23,360 --> 00:30:26,040 Speaker 1: the industry, the market where it's going, growth rates, all 541 00:30:26,080 --> 00:30:27,880 Speaker 1: those things. So you know, yeah, you have to do 542 00:30:27,960 --> 00:30:31,040 Speaker 1: work as an investor. But it's not you know, it's 543 00:30:31,080 --> 00:30:33,480 Speaker 1: not as if there won't be comparisons out there that 544 00:30:33,560 --> 00:30:35,960 Speaker 1: you can make in judgment that you can make in 545 00:30:36,080 --> 00:30:38,120 Speaker 1: order to make your assessment whether it's a good investment 546 00:30:38,160 --> 00:30:42,680 Speaker 1: or not. So I'm doing my research preparing for this conversation, 547 00:30:43,200 --> 00:30:46,320 Speaker 1: and I start working my way back through some of 548 00:30:47,680 --> 00:30:52,600 Speaker 1: Silicon Valley banks early relationships. They were Cisco's first bank, 549 00:30:53,040 --> 00:30:57,280 Speaker 1: I know the relationships with Apple, Intel. Tell us about 550 00:30:57,400 --> 00:31:00,320 Speaker 1: some of the history and some of the companies s 551 00:31:00,400 --> 00:31:03,000 Speaker 1: VB has worked with. Yeah, well, i'll give you some 552 00:31:03,080 --> 00:31:05,440 Speaker 1: of the history. I was not here at the time, 553 00:31:05,560 --> 00:31:08,880 Speaker 1: but I'll tell you the story that goes along with it. 554 00:31:08,920 --> 00:31:12,160 Speaker 1: One of our co founders, a gentleman named Bill bigger Staff. 555 00:31:12,640 --> 00:31:15,960 Speaker 1: The story goes that when the two individuals that formed 556 00:31:16,320 --> 00:31:20,720 Speaker 1: Cisco started the company, that he had um given them alone, 557 00:31:20,840 --> 00:31:23,840 Speaker 1: and he actually went to their house to actually give 558 00:31:23,880 --> 00:31:26,680 Speaker 1: them a very very small a loan to help them, 559 00:31:27,040 --> 00:31:29,680 Speaker 1: um so the capital plus that loan got them started. 560 00:31:29,720 --> 00:31:33,360 Speaker 1: So that's that's one of of many stories and kind 561 00:31:33,360 --> 00:31:35,720 Speaker 1: of our in our history books that we like to 562 00:31:35,840 --> 00:31:39,560 Speaker 1: certainly um reference and and given another story is that 563 00:31:39,600 --> 00:31:42,480 Speaker 1: one of the first acquisitions, if not the first acquisitions 564 00:31:42,480 --> 00:31:45,760 Speaker 1: that Cisco did, was one of my first clients when 565 00:31:45,840 --> 00:31:49,720 Speaker 1: I was a junior banker at at SVB called Crescendo, 566 00:31:50,120 --> 00:31:53,000 Speaker 1: and John Chambers and I, who know each other, we 567 00:31:53,000 --> 00:31:55,640 Speaker 1: were talking about that that story, and it was a 568 00:31:55,680 --> 00:31:58,560 Speaker 1: great acquisition for them, it was a great client of mine, 569 00:31:59,080 --> 00:32:01,840 Speaker 1: and it just it's again it's one of the great 570 00:32:01,880 --> 00:32:04,000 Speaker 1: things about the institution where you can go back and 571 00:32:04,000 --> 00:32:07,720 Speaker 1: look in history about these amazing, iconic companies that we 572 00:32:07,720 --> 00:32:10,200 Speaker 1: were part of at the beginning, and that's it's just 573 00:32:10,240 --> 00:32:11,920 Speaker 1: a it's a great thrill to look back at that. 574 00:32:12,480 --> 00:32:15,320 Speaker 1: So so given that amazing history and and all these 575 00:32:15,440 --> 00:32:19,800 Speaker 1: now giant names, SVB has been kind of low key. 576 00:32:19,840 --> 00:32:21,959 Speaker 1: And I don't know if media shy is the right 577 00:32:22,000 --> 00:32:25,640 Speaker 1: word because you're here doing this, but certainly you guys 578 00:32:25,680 --> 00:32:28,600 Speaker 1: don't advertise, you're not in the paper all the time. 579 00:32:29,000 --> 00:32:31,880 Speaker 1: You tend to be pretty low key. What's the thinking 580 00:32:31,880 --> 00:32:35,360 Speaker 1: behind that? Yeah, Well, from an advertising perspective, I mean 581 00:32:35,400 --> 00:32:39,240 Speaker 1: when I think of advertising, that's mostly for consumers, consumers, 582 00:32:39,520 --> 00:32:43,360 Speaker 1: consumer brands, and and that's not who we are. Um 583 00:32:43,520 --> 00:32:47,120 Speaker 1: we are. We work with companies, we work with venture capitalists, 584 00:32:47,160 --> 00:32:49,760 Speaker 1: we work it with you know, the healthcare space to 585 00:32:49,840 --> 00:32:52,680 Speaker 1: life science and where we spend time, and it's really 586 00:32:52,680 --> 00:32:55,480 Speaker 1: it's about relationships and making sure we're top of mind 587 00:32:55,520 --> 00:32:58,840 Speaker 1: with them. We're spending time with those individuals, spending time 588 00:32:58,880 --> 00:33:01,880 Speaker 1: with the venture capitalists, We're spending time with the entrepreneurs. 589 00:33:01,920 --> 00:33:05,800 Speaker 1: That's where our teams of people are and will sponsor things, 590 00:33:05,840 --> 00:33:09,360 Speaker 1: will host events, will create events around that. But it's 591 00:33:09,400 --> 00:33:12,600 Speaker 1: not it's not in mainstream. It's becoming more popular, it's 592 00:33:12,600 --> 00:33:17,000 Speaker 1: becoming more top of mind for individuals, but historically it 593 00:33:17,040 --> 00:33:19,000 Speaker 1: has been more low key. To use your your word. 594 00:33:19,480 --> 00:33:23,120 Speaker 1: So so let's let's stay with the organization. Guys are 595 00:33:23,160 --> 00:33:27,920 Speaker 1: publicly traded. You're the CEO. How did you manage the organization? 596 00:33:27,960 --> 00:33:31,080 Speaker 1: How did you run things during the pandemic when everyone 597 00:33:31,240 --> 00:33:34,440 Speaker 1: was forced to work from home. Well, the simple way 598 00:33:34,480 --> 00:33:36,440 Speaker 1: to describe it is make sure if you're going to 599 00:33:36,520 --> 00:33:38,520 Speaker 1: go through something like that, you've got a really good 600 00:33:38,520 --> 00:33:42,080 Speaker 1: team of people, and it starts with that, and no 601 00:33:42,280 --> 00:33:46,760 Speaker 1: CEO is making all the calls. No CEO is you know, 602 00:33:47,000 --> 00:33:50,520 Speaker 1: using just their own thinking, their own decision making process. 603 00:33:50,920 --> 00:33:53,200 Speaker 1: And so number one start with a great team, which 604 00:33:53,240 --> 00:33:55,719 Speaker 1: we we had. And so as we started to assess 605 00:33:55,760 --> 00:34:00,360 Speaker 1: the situation, it was thinking about our employees first and 606 00:34:00,400 --> 00:34:05,360 Speaker 1: thinking about our clients and shareholders. While important, always important. 607 00:34:05,360 --> 00:34:07,680 Speaker 1: When to make that note, UM, you got to focus 608 00:34:07,720 --> 00:34:09,919 Speaker 1: on the first two things. And so when we thought 609 00:34:09,920 --> 00:34:13,160 Speaker 1: about employees, it was how fast we can make sure 610 00:34:13,200 --> 00:34:15,120 Speaker 1: that we're taking care of them and protecting them. So 611 00:34:15,160 --> 00:34:18,480 Speaker 1: we went very quickly from a remote perspective, making sure 612 00:34:18,520 --> 00:34:22,319 Speaker 1: we were supporting them with home office, home technology capabilities 613 00:34:22,360 --> 00:34:24,799 Speaker 1: so they could do what they needed to do UM 614 00:34:24,840 --> 00:34:27,680 Speaker 1: and also take care of their families. That was first 615 00:34:27,680 --> 00:34:31,320 Speaker 1: and foremost. The second thing was taking care of our clients. 616 00:34:31,640 --> 00:34:34,800 Speaker 1: So when you see a shock like that, they're worried about. 617 00:34:35,239 --> 00:34:37,560 Speaker 1: I don't know what's going to happen next. My crystal 618 00:34:37,560 --> 00:34:40,600 Speaker 1: ball becomes very cloudy. I what I don't want to 619 00:34:40,640 --> 00:34:44,120 Speaker 1: have to deal with is my banking partner kind of 620 00:34:44,400 --> 00:34:47,359 Speaker 1: ringing up the phone or call him or emailing me saying, hey, 621 00:34:47,440 --> 00:34:50,759 Speaker 1: your loan payback your loan or we're worried about this. 622 00:34:51,200 --> 00:34:54,600 Speaker 1: So we give our clients a lot of flexibility and 623 00:34:54,640 --> 00:34:58,280 Speaker 1: we're paying our loans, holding off on making payments because 624 00:34:58,400 --> 00:35:01,280 Speaker 1: we said, we're in this together. This isn't your fault. 625 00:35:01,400 --> 00:35:03,600 Speaker 1: You didn't do this, and so we should be working 626 00:35:03,600 --> 00:35:06,640 Speaker 1: together to solve this problem, to get through this. And 627 00:35:06,960 --> 00:35:10,400 Speaker 1: I look back at that and A it was absolutely 628 00:35:10,400 --> 00:35:13,799 Speaker 1: the right call and be we got a lot of 629 00:35:13,840 --> 00:35:16,920 Speaker 1: great feedback from our clients and how supportive we were 630 00:35:17,000 --> 00:35:19,640 Speaker 1: for them and how important that was to them. And 631 00:35:19,880 --> 00:35:23,160 Speaker 1: as a CEO, you know, there's no better feeling than 632 00:35:23,200 --> 00:35:27,000 Speaker 1: getting those positive comments from your clients that you really 633 00:35:27,320 --> 00:35:29,319 Speaker 1: took care of them. And the same thing is true 634 00:35:29,320 --> 00:35:32,040 Speaker 1: with employees. So UM, I think we weathered the storm 635 00:35:32,200 --> 00:35:36,800 Speaker 1: really well. And and again our target market, this innovation economy, 636 00:35:36,880 --> 00:35:40,759 Speaker 1: bounced back so quickly, UM that we were fortunate to 637 00:35:40,760 --> 00:35:43,279 Speaker 1: be in the right space as well. So here in 638 00:35:43,320 --> 00:35:46,320 Speaker 1: New York there's drumbeat from a lot of big companies 639 00:35:46,440 --> 00:35:50,120 Speaker 1: want to see their staffers back in the office, but 640 00:35:50,239 --> 00:35:53,120 Speaker 1: there's a little resistance. Some of it is bi sector, 641 00:35:53,320 --> 00:35:56,600 Speaker 1: some of it is generational. What are your plans for 642 00:35:56,680 --> 00:36:00,520 Speaker 1: let's talk in the fall. Does everybody come back to office? 643 00:36:00,640 --> 00:36:03,560 Speaker 1: Is it a little more of a hybrid situation? What 644 00:36:03,560 --> 00:36:07,160 Speaker 1: what are the plans for a Silicon Valley bank post pandemic? 645 00:36:07,239 --> 00:36:09,600 Speaker 1: If I can dare use that phrase, Yeah, I think 646 00:36:09,840 --> 00:36:11,799 Speaker 1: first it goes back to what I just said, which 647 00:36:11,800 --> 00:36:13,960 Speaker 1: is you gotta take care of your employees first, right, 648 00:36:14,200 --> 00:36:17,040 Speaker 1: safety is the most important thing. And as much as 649 00:36:17,080 --> 00:36:20,040 Speaker 1: we want to get back together, we want to socialize, 650 00:36:20,080 --> 00:36:22,279 Speaker 1: we want to connect um, we want to make sure 651 00:36:22,440 --> 00:36:26,320 Speaker 1: that people are safe and there isn't you know, in 652 00:36:26,400 --> 00:36:28,839 Speaker 1: an impact on their on their families as well, and 653 00:36:28,840 --> 00:36:30,440 Speaker 1: so we we need to be first sensitive to that. 654 00:36:30,480 --> 00:36:33,040 Speaker 1: So what we're doing right now is we're doing some trials, 655 00:36:33,440 --> 00:36:36,399 Speaker 1: um testing things out, bringing some people back, seeing how 656 00:36:36,400 --> 00:36:39,120 Speaker 1: it operates, seeing what technology we need to adapt to 657 00:36:39,520 --> 00:36:42,400 Speaker 1: in this new flexible environment which we're going to. So 658 00:36:42,440 --> 00:36:44,680 Speaker 1: we want to make sure that first and foremost are 659 00:36:44,800 --> 00:36:48,160 Speaker 1: employees are safe. Second part is that they're taking care 660 00:36:48,160 --> 00:36:49,919 Speaker 1: of our clients and they've done a great job during 661 00:36:49,920 --> 00:36:52,120 Speaker 1: the pandemic. No reason to think that it's going to 662 00:36:52,200 --> 00:36:54,080 Speaker 1: slow down and they won't continue to do a great 663 00:36:54,120 --> 00:36:56,799 Speaker 1: job for our clients. But it's really the combination of 664 00:36:56,800 --> 00:36:58,719 Speaker 1: those two things, and so we're doing a lot of 665 00:36:58,760 --> 00:37:01,400 Speaker 1: surveys listening to our luis, and what our employees want 666 00:37:02,160 --> 00:37:05,120 Speaker 1: is they want flexibility. And so the future of work 667 00:37:05,120 --> 00:37:08,560 Speaker 1: at s VB will be to provide a more flexible 668 00:37:08,920 --> 00:37:12,480 Speaker 1: work environment. We're redoing a lot of our offices to 669 00:37:12,600 --> 00:37:17,840 Speaker 1: create more flexibility. We're allowing more UM support to have 670 00:37:17,960 --> 00:37:20,640 Speaker 1: them build their home offices so they can work from home. 671 00:37:21,080 --> 00:37:22,840 Speaker 1: So I think we're gonna have a lot of people 672 00:37:22,880 --> 00:37:25,279 Speaker 1: that are gonna be UM coming in a few days 673 00:37:25,280 --> 00:37:28,520 Speaker 1: a week, but the vast majority will not be coming 674 00:37:28,560 --> 00:37:30,680 Speaker 1: in UM five days a week. We think it's better 675 00:37:30,719 --> 00:37:32,640 Speaker 1: for our employees and we think it's better for our clients. 676 00:37:33,440 --> 00:37:39,520 Speaker 1: That's interesting. I'm I'm kind of fascinated by let's talk 677 00:37:39,560 --> 00:37:42,360 Speaker 1: sector by sector. A lot of finance was able to 678 00:37:42,400 --> 00:37:46,080 Speaker 1: work remotely. A lot of technology was able to work remotely. 679 00:37:46,120 --> 00:37:52,360 Speaker 1: There are certain businesses travel, entertainment, hospitality that physically have 680 00:37:52,480 --> 00:37:55,680 Speaker 1: to be be there. You're doing a little bit of 681 00:37:55,680 --> 00:37:58,799 Speaker 1: business travel. You're here in New York from California. What 682 00:37:58,920 --> 00:38:02,279 Speaker 1: do you see as you travel around the country. Is California, 683 00:38:02,360 --> 00:38:06,440 Speaker 1: because of the tech heaviness, more open to a hybrid model. 684 00:38:06,480 --> 00:38:09,560 Speaker 1: What what are you seeing from your perspective. Yeah, I 685 00:38:09,560 --> 00:38:14,400 Speaker 1: think technology companies are definitely more open to hybrid They're 686 00:38:14,520 --> 00:38:18,279 Speaker 1: much more open to working remotely, They're more open to 687 00:38:18,920 --> 00:38:21,960 Speaker 1: being flexible. Part of it is is that you know 688 00:38:22,080 --> 00:38:25,240 Speaker 1: you have a skill, a contribution that can be made, 689 00:38:25,280 --> 00:38:28,640 Speaker 1: and if it's computer programmers or UM sales support or 690 00:38:28,640 --> 00:38:30,839 Speaker 1: whatever you want to call it, that you can be 691 00:38:31,160 --> 00:38:35,960 Speaker 1: more more remote. The more business or industry has an 692 00:38:36,000 --> 00:38:40,960 Speaker 1: apprentice model, the more being in person like that's going 693 00:38:41,000 --> 00:38:43,359 Speaker 1: to be even more important. So it it depends upon 694 00:38:43,480 --> 00:38:45,920 Speaker 1: what the needs are of the of the business. So 695 00:38:45,960 --> 00:38:48,960 Speaker 1: technology companies, by definition, are going to be more more flexible. 696 00:38:49,320 --> 00:38:52,800 Speaker 1: We're we're somewhere in in between. We're not we're somewhat 697 00:38:52,800 --> 00:38:54,919 Speaker 1: of an apprentice model, We're not a full apprentice model. 698 00:38:55,160 --> 00:38:57,120 Speaker 1: So we can be in that middle ground of not 699 00:38:57,200 --> 00:39:01,080 Speaker 1: requiring everyone to be back, but also now having everybody 700 00:39:01,320 --> 00:39:03,600 Speaker 1: be flexible wherever they want to work. And I think 701 00:39:03,600 --> 00:39:06,120 Speaker 1: that's going to be the right balance. So I think 702 00:39:06,160 --> 00:39:10,160 Speaker 1: of Silicon Valley as a place, but if you have 703 00:39:10,239 --> 00:39:14,440 Speaker 1: a lot of people working remote, well, there's really no 704 00:39:14,640 --> 00:39:19,879 Speaker 1: latency difference between Colorado and Palo Alto. Do you run 705 00:39:19,920 --> 00:39:24,520 Speaker 1: the risk of losing that nexus of intellectual capital all 706 00:39:24,600 --> 00:39:28,200 Speaker 1: in in one place, if people are scattered to the 707 00:39:28,239 --> 00:39:29,920 Speaker 1: four winds and don't have to be in on a 708 00:39:29,960 --> 00:39:33,960 Speaker 1: regular basis. So I'll break that apart to two answers. 709 00:39:34,040 --> 00:39:37,239 Speaker 1: One is the technology in the life science industry, and 710 00:39:37,239 --> 00:39:39,960 Speaker 1: then I'll just speak for for our business on the 711 00:39:39,960 --> 00:39:43,800 Speaker 1: technical life science area. Silicon Valley has been for years 712 00:39:43,800 --> 00:39:45,920 Speaker 1: of people have said, oh, his Silicon Valley going to 713 00:39:46,320 --> 00:39:49,759 Speaker 1: fall apart. It's expensive, it's all these things are going 714 00:39:49,800 --> 00:39:52,640 Speaker 1: to be more of a challenge, and other markets are 715 00:39:52,680 --> 00:39:55,360 Speaker 1: going to pick up the pace and be more competitive. 716 00:39:55,840 --> 00:39:59,640 Speaker 1: And my view is while other markets are going to 717 00:39:59,760 --> 00:40:03,560 Speaker 1: do better than they have historically, right New York and 718 00:40:03,960 --> 00:40:08,600 Speaker 1: Atlanta and Chicago and Denver and Austin and Seattle are 719 00:40:08,600 --> 00:40:11,239 Speaker 1: going to continue to do better, it's not going to 720 00:40:11,280 --> 00:40:15,040 Speaker 1: be at the expense of Silicon Valley. Silicon Valley, from 721 00:40:15,080 --> 00:40:18,400 Speaker 1: my standpoint, will continue to thrive. It will still be, 722 00:40:18,440 --> 00:40:21,960 Speaker 1: at least for my lifetime, I believe, the innovation capital 723 00:40:22,080 --> 00:40:26,399 Speaker 1: of the world. But innovation is everywhere, and so it 724 00:40:26,440 --> 00:40:29,120 Speaker 1: makes sense that these other markets are going to still 725 00:40:29,160 --> 00:40:33,560 Speaker 1: do really well. They're still gonna get more innovation jobs 726 00:40:33,800 --> 00:40:37,960 Speaker 1: innovation companies in those markets, and so I believe kind 727 00:40:37,960 --> 00:40:40,759 Speaker 1: of all boats will rise, not It's not going to 728 00:40:40,800 --> 00:40:42,400 Speaker 1: be a zero sum game the way I think too 729 00:40:42,440 --> 00:40:45,359 Speaker 1: many people think about. For our business, we do have 730 00:40:45,400 --> 00:40:48,359 Speaker 1: a lot of interaction. We do have offices all over 731 00:40:48,400 --> 00:40:50,400 Speaker 1: the country, and so we want to make sure our 732 00:40:50,480 --> 00:40:53,279 Speaker 1: people are close to those hubs so when they do 733 00:40:53,360 --> 00:40:56,640 Speaker 1: come in that they have access to engaging with our 734 00:40:56,680 --> 00:41:00,200 Speaker 1: other teammates that allow them to learn and develop and 735 00:41:00,239 --> 00:41:03,040 Speaker 1: build relationships and all those things. So that's one thing. 736 00:41:03,080 --> 00:41:06,360 Speaker 1: The second thing is if you're a client facing individual, 737 00:41:06,719 --> 00:41:09,200 Speaker 1: you obviously have to be in the market where your 738 00:41:09,200 --> 00:41:11,279 Speaker 1: clients are, and so that that isn't going to change 739 00:41:11,320 --> 00:41:14,040 Speaker 1: if your if your clients are in northern California, you 740 00:41:14,080 --> 00:41:18,520 Speaker 1: can't live in Nashville, you can't live in you know, Austin, Texas, 741 00:41:18,600 --> 00:41:21,319 Speaker 1: if your clients are in the Bay Area. So that 742 00:41:21,440 --> 00:41:25,359 Speaker 1: obviously is one important important function, but we believe it's 743 00:41:25,400 --> 00:41:27,960 Speaker 1: a it's a balance of apprenticeship as well as um 744 00:41:28,040 --> 00:41:30,239 Speaker 1: you can do things remote as well. Let's talk a 745 00:41:30,239 --> 00:41:33,080 Speaker 1: little bit about fintech since that covers a little bit 746 00:41:33,160 --> 00:41:36,439 Speaker 1: of both the areas that you guys play in it's 747 00:41:36,480 --> 00:41:39,520 Speaker 1: obviously been a huge area of growth over the past decade. 748 00:41:39,960 --> 00:41:41,680 Speaker 1: What are you doing to stay ahead of the curve? 749 00:41:41,719 --> 00:41:44,759 Speaker 1: How do you make sure after helping all these disruptive 750 00:41:44,800 --> 00:41:49,160 Speaker 1: companies that you yourself don't get disrupted. Yeah, I'd say 751 00:41:49,239 --> 00:41:51,920 Speaker 1: it's it's both a blessing and I wouldn't call it 752 00:41:51,960 --> 00:41:53,440 Speaker 1: a curse, But I would say a blessing and a 753 00:41:53,560 --> 00:41:57,040 Speaker 1: challenge to be so close to the innovation UH market 754 00:41:57,120 --> 00:42:00,319 Speaker 1: and these fintech companies, because you see how fast grow, 755 00:42:00,400 --> 00:42:02,920 Speaker 1: you see how fast they adapt, and so there's a 756 00:42:02,960 --> 00:42:05,640 Speaker 1: there's a paranoid part about that, But I think that 757 00:42:05,719 --> 00:42:09,920 Speaker 1: helps us as an institution realize that we have to 758 00:42:10,000 --> 00:42:12,680 Speaker 1: keep pressing ahead, that we have to be bold, that 759 00:42:12,760 --> 00:42:15,359 Speaker 1: we can't wait for things to happen, that we need 760 00:42:15,360 --> 00:42:18,359 Speaker 1: to try new things. We have an innovation team, We're 761 00:42:18,400 --> 00:42:21,000 Speaker 1: investing in new businesses. Maybe it can't be part of 762 00:42:21,000 --> 00:42:24,719 Speaker 1: our core competency inside SVB, but we can invest in 763 00:42:24,760 --> 00:42:27,480 Speaker 1: those businesses and provide those solutions to our clients. So 764 00:42:27,719 --> 00:42:30,920 Speaker 1: I believe it's actually we can benefit from it, and 765 00:42:31,000 --> 00:42:33,000 Speaker 1: we can benefit from it in a business, but we 766 00:42:33,000 --> 00:42:35,719 Speaker 1: can also benefit it in supporting our clients because we know, 767 00:42:35,840 --> 00:42:38,359 Speaker 1: we have to innovate, So yeah, we spent a lot 768 00:42:38,360 --> 00:42:40,520 Speaker 1: of time. We have a national fintech practice and so 769 00:42:40,560 --> 00:42:44,480 Speaker 1: we work with many, many, many fintech companies and support 770 00:42:44,520 --> 00:42:47,960 Speaker 1: them in payments, We support them in warehouse lending when 771 00:42:47,960 --> 00:42:51,400 Speaker 1: they're trying to do loans themselves to consumers or loans 772 00:42:51,400 --> 00:42:53,880 Speaker 1: to small business. Um. So we support them in a 773 00:42:53,920 --> 00:42:55,719 Speaker 1: variety of different ways, and kind of every day that 774 00:42:55,760 --> 00:42:58,400 Speaker 1: goes by, we're figuring about what's the next thing we 775 00:42:58,400 --> 00:43:00,680 Speaker 1: can do to support them. Let me real curve ble 776 00:43:00,880 --> 00:43:05,200 Speaker 1: at you a little bit. WINEMI and wine business. Why 777 00:43:05,239 --> 00:43:08,200 Speaker 1: is Silicon Valley Bank. I know you work with life 778 00:43:08,239 --> 00:43:11,320 Speaker 1: science and clean tech and venture capital. How does wine 779 00:43:11,320 --> 00:43:15,000 Speaker 1: fit into that business other than the proximity of NAPA 780 00:43:15,080 --> 00:43:17,640 Speaker 1: and Sonoma so to where you guys are. Yeah, maybe 781 00:43:17,680 --> 00:43:20,640 Speaker 1: I could claim it's a life science connection because it's 782 00:43:20,680 --> 00:43:24,880 Speaker 1: all the health benefits, but it's actually a historical in 783 00:43:25,280 --> 00:43:27,279 Speaker 1: the sense when the bank was first formed back in 784 00:43:27,320 --> 00:43:32,640 Speaker 1: the early eighties, we did some innovation, so whatever technology 785 00:43:32,760 --> 00:43:34,680 Speaker 1: was back then in the in the eighties, semi connector 786 00:43:34,760 --> 00:43:37,760 Speaker 1: companies and some networking companies, and then we did general 787 00:43:38,239 --> 00:43:42,120 Speaker 1: commercial industries and real estate, and then we also did 788 00:43:42,200 --> 00:43:45,960 Speaker 1: some you know, private banking back at that time as well, 789 00:43:46,440 --> 00:43:49,680 Speaker 1: and so over time, when we were doing commercial industries, 790 00:43:49,680 --> 00:43:52,719 Speaker 1: we're doing commercial real estate. What we realized is that 791 00:43:53,000 --> 00:43:54,719 Speaker 1: maybe we weren't as good as we thought we were 792 00:43:54,760 --> 00:43:56,719 Speaker 1: at it, and so the real estate crisis in the 793 00:43:56,800 --> 00:44:00,120 Speaker 1: late eighties and the early nineties, we said, maybe that's 794 00:44:00,160 --> 00:44:01,960 Speaker 1: not something we should be doing. But we're pretty good 795 00:44:01,960 --> 00:44:04,799 Speaker 1: at this technology stuff. So what happened is we kept 796 00:44:04,800 --> 00:44:08,080 Speaker 1: whittling down what we are really good at until we 797 00:44:08,200 --> 00:44:12,640 Speaker 1: ended up in the late nineties of technology and life sciences, 798 00:44:12,960 --> 00:44:16,080 Speaker 1: and we had this one business, Premium Wines and NAPA 799 00:44:16,080 --> 00:44:19,359 Speaker 1: and Sonoma, and it was a really good business. But 800 00:44:19,520 --> 00:44:22,200 Speaker 1: with the other benefit to it is actually it's great 801 00:44:22,280 --> 00:44:25,680 Speaker 1: marketing and it's great connectivity. And if relationship building is 802 00:44:25,719 --> 00:44:29,680 Speaker 1: so important as it is, you can leverage those clients, 803 00:44:30,120 --> 00:44:34,600 Speaker 1: those winemakers, and those relationships and you can create connectivity 804 00:44:34,680 --> 00:44:37,560 Speaker 1: across your client base in a really unique way. So 805 00:44:37,600 --> 00:44:40,480 Speaker 1: we said, it's a great business that makes the rest 806 00:44:40,520 --> 00:44:42,719 Speaker 1: of the business better, so let's keep it. And it's 807 00:44:42,719 --> 00:44:44,919 Speaker 1: been it's been really nice to have and we host 808 00:44:44,920 --> 00:44:47,359 Speaker 1: events up a NAP and Sonoma and we help those 809 00:44:47,400 --> 00:44:51,480 Speaker 1: winery clients um sell more of their product to our 810 00:44:51,680 --> 00:44:54,160 Speaker 1: technology and innovation clients. And so there's a really good 811 00:44:54,400 --> 00:44:56,520 Speaker 1: match between the two. That makes a whole lot of sense. 812 00:44:56,560 --> 00:44:59,520 Speaker 1: And I am a giant fan of Napa Valley cabs 813 00:45:00,120 --> 00:45:03,920 Speaker 1: that they come visit, come out um. Now that traveling 814 00:45:03,960 --> 00:45:07,160 Speaker 1: is reopening, it's absolutely on my uh A list of 815 00:45:07,200 --> 00:45:10,520 Speaker 1: things to do. As much as everybody claims to hate 816 00:45:10,520 --> 00:45:15,239 Speaker 1: business travel, you miss occasionally getting out on a on 817 00:45:15,280 --> 00:45:19,080 Speaker 1: a trip like that. The last conference I was in 818 00:45:19,080 --> 00:45:22,279 Speaker 1: in San Francisco ended with a bunch of us heading 819 00:45:22,320 --> 00:45:24,920 Speaker 1: up to Napa for a couple of days. And you know, 820 00:45:25,040 --> 00:45:27,560 Speaker 1: after three days of panels and that sort of stuff, 821 00:45:27,920 --> 00:45:30,120 Speaker 1: it was a great break. It's a little bit too 822 00:45:30,160 --> 00:45:32,800 Speaker 1: long of a flight to just go for a conference 823 00:45:32,800 --> 00:45:36,600 Speaker 1: for a couple of days, so it became something fun. 824 00:45:37,160 --> 00:45:41,319 Speaker 1: I could see how having Sonoma, Napa Valley in your 825 00:45:41,360 --> 00:45:46,320 Speaker 1: backyard is a great multiplier for all the other businesses. 826 00:45:46,320 --> 00:45:49,600 Speaker 1: How that connection and and much like we have in 827 00:45:50,040 --> 00:45:53,200 Speaker 1: healthcare and technology and software and all those industries, we 828 00:45:53,239 --> 00:45:55,400 Speaker 1: have experts that this is what they do kind of 829 00:45:55,440 --> 00:45:59,319 Speaker 1: twenty four by seven our wine group, they're experts in 830 00:45:59,320 --> 00:46:02,319 Speaker 1: this industry. They really are are viewed as being the 831 00:46:02,400 --> 00:46:06,440 Speaker 1: smartest people in understanding these industries, and and that's the 832 00:46:06,440 --> 00:46:09,080 Speaker 1: way are we approached investment banking. That's where we approach 833 00:46:09,160 --> 00:46:11,960 Speaker 1: private banking. We want to be the best, the best people, 834 00:46:11,960 --> 00:46:15,200 Speaker 1: the most knowledgeable people in giving advice in the industries 835 00:46:15,239 --> 00:46:17,160 Speaker 1: that we serve. And I think the Wine Group is 836 00:46:17,200 --> 00:46:20,799 Speaker 1: just another example of that. SVBS reputation is that it 837 00:46:20,920 --> 00:46:26,880 Speaker 1: understands startups like very few banking institutions. Those relationships are 838 00:46:26,920 --> 00:46:29,240 Speaker 1: a giant advantage that that you've had for a while. 839 00:46:29,800 --> 00:46:33,880 Speaker 1: How long can you maintain this lead? Is this something 840 00:46:33,920 --> 00:46:38,080 Speaker 1: that's specific to you? What are you doing to stay competitive? 841 00:46:38,800 --> 00:46:42,879 Speaker 1: As more and more financial institutions look at Silicon Vali 842 00:46:42,960 --> 00:46:45,840 Speaker 1: and say we want to muscle our ways into that space. 843 00:46:46,120 --> 00:46:48,600 Speaker 1: I look at it this way, Barry. You can take 844 00:46:49,120 --> 00:46:56,400 Speaker 1: a defensive posture, or you can take an offensive posture. 845 00:46:56,960 --> 00:47:00,320 Speaker 1: We are taking an offensive posture, meaning the way east 846 00:47:00,440 --> 00:47:04,040 Speaker 1: keep our relationships, the way we continue to do what 847 00:47:04,080 --> 00:47:07,000 Speaker 1: we're doing is you don't look back and say, what 848 00:47:07,040 --> 00:47:09,160 Speaker 1: can we hold back from our clients? What can we 849 00:47:09,200 --> 00:47:11,319 Speaker 1: how do we create more of a moat around them? 850 00:47:11,320 --> 00:47:14,240 Speaker 1: It is actually you end up doing a better job 851 00:47:14,280 --> 00:47:17,440 Speaker 1: of providing one stop shopping all the products and services, 852 00:47:17,480 --> 00:47:19,719 Speaker 1: so you go. It's like, the reason we did the 853 00:47:19,760 --> 00:47:22,400 Speaker 1: acquisition of of Living Partners and we're building out our 854 00:47:22,400 --> 00:47:25,400 Speaker 1: investment bank is to add more value to our clients. 855 00:47:25,880 --> 00:47:29,759 Speaker 1: The reason we acquired Boston Private was to add more 856 00:47:29,840 --> 00:47:33,240 Speaker 1: private banking and wealth management capabilities. The reason we acquired 857 00:47:33,280 --> 00:47:35,680 Speaker 1: West River Group is to make sure we can lend 858 00:47:36,040 --> 00:47:40,040 Speaker 1: even greater sums of money and higher risk type of 859 00:47:40,160 --> 00:47:44,799 Speaker 1: lending to them. All those things are My view is 860 00:47:44,880 --> 00:47:47,239 Speaker 1: you could say it's being defensive. I don't view it 861 00:47:47,280 --> 00:47:50,200 Speaker 1: as being defensive. VIEWS view it as being on the 862 00:47:50,280 --> 00:47:53,799 Speaker 1: offense to take care of our clients, no matter how 863 00:47:53,840 --> 00:47:56,560 Speaker 1: big they get, no matter whatever they need. From a 864 00:47:56,640 --> 00:47:59,520 Speaker 1: financial solutions perspective, we want to be there for them, 865 00:48:00,000 --> 00:48:02,239 Speaker 1: and I think we have to think about that every 866 00:48:02,280 --> 00:48:06,200 Speaker 1: single day. We can't take our relationships for granted. We 867 00:48:06,239 --> 00:48:09,600 Speaker 1: have to win those relationships back every single day. And 868 00:48:09,640 --> 00:48:12,879 Speaker 1: if every employee thinks that way, that's where I think 869 00:48:12,880 --> 00:48:15,600 Speaker 1: we're gonna continue to be um the winning solution for 870 00:48:15,680 --> 00:48:19,560 Speaker 1: these companies. That sounds really like like the right strategy. 871 00:48:20,040 --> 00:48:22,640 Speaker 1: I know I only have you for a few more moments, 872 00:48:22,640 --> 00:48:25,640 Speaker 1: so Let's jump to our favorite questions that we asked 873 00:48:26,040 --> 00:48:28,839 Speaker 1: all of our guests, starting with tell us what you're 874 00:48:28,840 --> 00:48:32,440 Speaker 1: streaming these days? Give us your favorite Netflix or Amazon Prime, 875 00:48:32,480 --> 00:48:36,200 Speaker 1: whatever is keeping you entertained. Two things. One, Ted Lasso 876 00:48:36,880 --> 00:48:39,399 Speaker 1: love that show. I'm glad it came back for a 877 00:48:39,400 --> 00:48:42,799 Speaker 1: season two. It's just it's such a great storyline and 878 00:48:42,840 --> 00:48:47,560 Speaker 1: it's so funny. It's that's awesome. The second one, during COVID, 879 00:48:47,880 --> 00:48:51,000 Speaker 1: my wife and I and family, we watch a ton 880 00:48:51,200 --> 00:48:56,480 Speaker 1: of anything David Adenborough, Anything David Adenburgh about you know, 881 00:48:56,560 --> 00:48:59,920 Speaker 1: the Earth and climate and you know it's the ocean. 882 00:49:00,200 --> 00:49:04,080 Speaker 1: I mean, it's the visual part and the just how 883 00:49:04,120 --> 00:49:06,640 Speaker 1: fortunate we are to have the earth that we have 884 00:49:06,880 --> 00:49:08,520 Speaker 1: and how we all need to do a better job 885 00:49:08,560 --> 00:49:11,239 Speaker 1: of protecting it. Those are the two biggest things that 886 00:49:11,280 --> 00:49:14,320 Speaker 1: we we stream. I'm trying to I'm googling while we speak, 887 00:49:14,440 --> 00:49:17,880 Speaker 1: trying to look up the name of the newest show 888 00:49:18,680 --> 00:49:22,600 Speaker 1: that he just came out with, and I'm drawing a 889 00:49:22,680 --> 00:49:25,560 Speaker 1: blank on it. It was it Life on Earth Again, 890 00:49:26,080 --> 00:49:30,040 Speaker 1: Life on Our Planet phenomenal. He has like the perfect 891 00:49:30,120 --> 00:49:33,600 Speaker 1: voice for narrating that sort of stuff. I'm a big 892 00:49:33,640 --> 00:49:37,520 Speaker 1: fan as well, So tell us about your early mentors 893 00:49:37,520 --> 00:49:41,960 Speaker 1: who helped to shape your career. Yeah, it's you know, 894 00:49:42,040 --> 00:49:45,040 Speaker 1: being in in financial services as long as I have 895 00:49:45,600 --> 00:49:48,360 Speaker 1: been UM and being at SVB for twenty eight years, 896 00:49:48,840 --> 00:49:53,880 Speaker 1: a lot of my mentors have been here at at SVB. 897 00:49:54,280 --> 00:49:56,919 Speaker 1: And actually one that was even before that. So Mark 898 00:49:57,000 --> 00:50:00,319 Speaker 1: Arrissimo was an individual that I managed. I were with 899 00:50:00,520 --> 00:50:02,759 Speaker 1: UM at another bank before I joined Silicon Valley Bank, 900 00:50:02,760 --> 00:50:04,600 Speaker 1: and he's the individual that brought me over. You know. 901 00:50:04,640 --> 00:50:10,080 Speaker 1: Mark was great about you know, basically inspiring you to 902 00:50:10,239 --> 00:50:15,600 Speaker 1: think differently, inspiring you to to just kind of try 903 00:50:15,719 --> 00:50:19,760 Speaker 1: new things, and giving you the autonomy, giving the responsibility 904 00:50:19,960 --> 00:50:22,680 Speaker 1: to fail. It's okay if you fail, what did you 905 00:50:22,800 --> 00:50:25,480 Speaker 1: learn from your failure? And so Mark was one, Uh 906 00:50:25,760 --> 00:50:30,520 Speaker 1: my predecessor, um Ken Wilcox. Um would definitely be a 907 00:50:30,600 --> 00:50:35,399 Speaker 1: second mentor in addition to giving me incredible opportunities which 908 00:50:35,440 --> 00:50:41,719 Speaker 1: I greatly appreciate. Uh, he was so um. What was 909 00:50:41,760 --> 00:50:45,440 Speaker 1: so important to him was leadership principles, and he taught 910 00:50:45,560 --> 00:50:49,319 Speaker 1: leadership principles to me, taught leadership principles to the rest 911 00:50:49,320 --> 00:50:52,879 Speaker 1: of the executive team about casting your shadow and how 912 00:50:52,920 --> 00:50:57,720 Speaker 1: important that is about decision making process. All these things 913 00:50:57,800 --> 00:51:00,239 Speaker 1: that even to this day, UM, I think of out 914 00:51:00,680 --> 00:51:02,680 Speaker 1: maybe not on a daily basis, but I think about 915 00:51:02,719 --> 00:51:06,440 Speaker 1: on a regular basis. And so UM clearly he was inspirational. 916 00:51:06,480 --> 00:51:09,160 Speaker 1: And the last person UM was a gentleman named Bob 917 00:51:09,200 --> 00:51:11,560 Speaker 1: Samuels who was an executive coach of mine for a 918 00:51:11,640 --> 00:51:13,880 Speaker 1: number of years. I learned a lot from Bob, but 919 00:51:13,920 --> 00:51:18,880 Speaker 1: the one thing in particular was how important empathy is, 920 00:51:19,520 --> 00:51:24,840 Speaker 1: how important empathy is to understand clients, how important empathy 921 00:51:25,000 --> 00:51:29,520 Speaker 1: is to understand the people you work with, understand kind 922 00:51:29,520 --> 00:51:33,920 Speaker 1: of everyone else, and you know, not faulting people when 923 00:51:33,960 --> 00:51:36,280 Speaker 1: they have when of a certain point of view, because 924 00:51:36,320 --> 00:51:38,960 Speaker 1: that's how they feel. And you can't take away how 925 00:51:39,000 --> 00:51:42,760 Speaker 1: people feel about something that's what they own. And understanding 926 00:51:42,760 --> 00:51:45,360 Speaker 1: that and being empathetic to that really allows you to 927 00:51:45,400 --> 00:51:48,040 Speaker 1: connect with people. And my view is in a very 928 00:51:48,080 --> 00:51:50,279 Speaker 1: different way. So those are a few of the many 929 00:51:50,360 --> 00:51:52,520 Speaker 1: mentors that I have had over the years that have 930 00:51:52,600 --> 00:51:56,160 Speaker 1: really helped shape my career. Let's talk about everybody's favorite 931 00:51:56,239 --> 00:51:58,719 Speaker 1: question books. Tell us some of your favorites and what 932 00:51:58,760 --> 00:52:01,920 Speaker 1: are you reading right now? Yeah? The one I described 933 00:52:01,960 --> 00:52:04,719 Speaker 1: to our team at the bank UH for many many years, 934 00:52:04,760 --> 00:52:06,360 Speaker 1: is this a book called The Boys in the Boat 935 00:52:06,719 --> 00:52:09,440 Speaker 1: and it's actually timely because of the Olympics being around, 936 00:52:09,880 --> 00:52:11,680 Speaker 1: and it's a set back on the I want to 937 00:52:11,680 --> 00:52:13,880 Speaker 1: say the thirties and the forties, and it was a 938 00:52:13,880 --> 00:52:16,960 Speaker 1: team up in Seattle and it was this individual who 939 00:52:17,000 --> 00:52:21,640 Speaker 1: came from nowhere and working together as a team in 940 00:52:21,760 --> 00:52:26,320 Speaker 1: the eight person's Skull to winning the Olympics in Germany. 941 00:52:26,520 --> 00:52:30,400 Speaker 1: And it's about teamwork. It is about um, the feeling 942 00:52:30,520 --> 00:52:33,719 Speaker 1: when you're part of a great team, how important that 943 00:52:33,840 --> 00:52:36,399 Speaker 1: is and how impactful it can be. So that that's 944 00:52:36,400 --> 00:52:38,839 Speaker 1: a great That's a great book. Other books that I've 945 00:52:38,920 --> 00:52:42,160 Speaker 1: I've read recently the Pacific War nineteen forty one to 946 00:52:42,239 --> 00:52:44,360 Speaker 1: ninety five. And the most recent one which kind of 947 00:52:44,360 --> 00:52:47,520 Speaker 1: fits into that same genre, is a book called two 948 00:52:47,560 --> 00:52:52,520 Speaker 1: thousand thirty four and it's about a future war between 949 00:52:52,560 --> 00:52:57,440 Speaker 1: the US and China and how bad decisions, small bad 950 00:52:57,480 --> 00:53:02,080 Speaker 1: decisions can create some thing very significant. You know to 951 00:53:02,120 --> 00:53:07,279 Speaker 1: me that the war books are about strategy, it's about tactics, 952 00:53:07,680 --> 00:53:10,960 Speaker 1: it's about human nature, um and in lessons that we 953 00:53:11,000 --> 00:53:12,520 Speaker 1: can all learn from them. So those are a few 954 00:53:12,520 --> 00:53:14,799 Speaker 1: of the things that I've been I have read UM 955 00:53:14,840 --> 00:53:17,720 Speaker 1: that I like and I've been read read recently quite interesting. 956 00:53:18,320 --> 00:53:20,600 Speaker 1: What sort of advice would you give to a recent 957 00:53:20,719 --> 00:53:24,400 Speaker 1: college grad who was interested in a career in either 958 00:53:24,600 --> 00:53:29,920 Speaker 1: banking or lending or venture investor. Yeah, I would just 959 00:53:29,960 --> 00:53:33,319 Speaker 1: say advice in general, and I'll talk about advice and 960 00:53:33,840 --> 00:53:36,200 Speaker 1: banking and finance. And first of all, I gets an 961 00:53:36,200 --> 00:53:41,240 Speaker 1: incredible career. I think anytime you can really understand how 962 00:53:41,360 --> 00:53:44,800 Speaker 1: businesses operate and get exposed to a variety of different 963 00:53:44,840 --> 00:53:48,000 Speaker 1: businesses the way, um you know, commercial bankers do, the 964 00:53:48,000 --> 00:53:52,040 Speaker 1: way investment bankers do, I think that's an incredible skill. 965 00:53:52,480 --> 00:53:55,000 Speaker 1: It's incredible knowledge to be gained, and it will allow 966 00:53:55,040 --> 00:53:57,440 Speaker 1: you to be successful in my view, no matter what 967 00:53:57,480 --> 00:53:58,719 Speaker 1: you're doing. If you want to stay is at it 968 00:53:58,760 --> 00:54:00,879 Speaker 1: as a career, or if you want to leave that 969 00:54:01,000 --> 00:54:03,560 Speaker 1: as a career and then go into a business where 970 00:54:03,600 --> 00:54:06,440 Speaker 1: maybe you're a CFO or you're a finance person. I 971 00:54:06,440 --> 00:54:08,920 Speaker 1: think all those things are are great to learn, So 972 00:54:09,239 --> 00:54:12,000 Speaker 1: I would I wouldn't say less about lessons on that part. 973 00:54:12,000 --> 00:54:14,160 Speaker 1: I would say it is a great career. So if 974 00:54:14,160 --> 00:54:16,279 Speaker 1: you get a chance, you know, go for it, do it. 975 00:54:16,520 --> 00:54:19,719 Speaker 1: I don't think you'll be disappointed. Advice in general, that 976 00:54:19,840 --> 00:54:22,600 Speaker 1: I give to college grads, and I've got I've got 977 00:54:22,840 --> 00:54:24,840 Speaker 1: two kids that have just graduated from college of the 978 00:54:24,880 --> 00:54:27,160 Speaker 1: last couple of years, and I have three kids in college. 979 00:54:27,520 --> 00:54:29,719 Speaker 1: And so UM, I do spend a lot of time 980 00:54:29,760 --> 00:54:32,799 Speaker 1: thinking about about this and and talking about it. Whether 981 00:54:32,840 --> 00:54:34,880 Speaker 1: they take my advice or not, I don't know, but 982 00:54:34,960 --> 00:54:37,440 Speaker 1: I certainly am happy to share it. So one is 983 00:54:37,920 --> 00:54:41,080 Speaker 1: I think too many college kids when they graduate. I 984 00:54:41,239 --> 00:54:44,000 Speaker 1: think that they're going from this place of happiness and 985 00:54:44,080 --> 00:54:47,880 Speaker 1: joy in college too. I'm going to work for the 986 00:54:47,920 --> 00:54:50,600 Speaker 1: rest of my life and it's going to be miserable. 987 00:54:51,400 --> 00:54:54,200 Speaker 1: And my biggest piece of advice is if you don't 988 00:54:54,280 --> 00:54:57,399 Speaker 1: find joy in what you do in your career, right, 989 00:54:57,600 --> 00:55:01,640 Speaker 1: you got to change your mind around there. I know 990 00:55:01,680 --> 00:55:04,960 Speaker 1: when I first got out, I loved doing what I 991 00:55:05,000 --> 00:55:08,080 Speaker 1: did because the people I got to meet and the 992 00:55:08,200 --> 00:55:11,839 Speaker 1: lessons that I learned and understanding how different businesses work, 993 00:55:12,239 --> 00:55:15,520 Speaker 1: and to me, that was incredibly exciting and stimulating. So 994 00:55:15,560 --> 00:55:18,680 Speaker 1: the first thing is find joy in what you do. 995 00:55:19,080 --> 00:55:20,920 Speaker 1: You may do it for a long period of time, 996 00:55:21,320 --> 00:55:24,239 Speaker 1: but it's not forever, and you're gonna learn things are 997 00:55:24,239 --> 00:55:28,600 Speaker 1: gonna be great, stimulating, motivating, UM. And so that's number 998 00:55:28,719 --> 00:55:32,400 Speaker 1: that's number one. The second thing is to um realize 999 00:55:32,440 --> 00:55:35,279 Speaker 1: that it's not supposed to be easy. If you got 1000 00:55:35,360 --> 00:55:38,839 Speaker 1: took a job and it's easy, you're probably a not 1001 00:55:38,960 --> 00:55:42,799 Speaker 1: working hard enough or B. Well that's probably the main 1002 00:55:42,920 --> 00:55:45,040 Speaker 1: the main, the main thing, or you're setting your bar 1003 00:55:45,080 --> 00:55:47,520 Speaker 1: too low. Right. You should be thinking about something that's 1004 00:55:47,520 --> 00:55:50,640 Speaker 1: going to stimulate you and challenge you, challenge you more. So, 1005 00:55:51,000 --> 00:55:53,680 Speaker 1: It's not supposed to be easy, So get over it 1006 00:55:53,760 --> 00:55:56,200 Speaker 1: and go back to point number one. Still find joy 1007 00:55:56,239 --> 00:55:58,600 Speaker 1: in what you do. The third one fits into that 1008 00:55:58,640 --> 00:56:02,720 Speaker 1: same vein as well, which is b curious. Um Again, 1009 00:56:02,960 --> 00:56:05,759 Speaker 1: the most frustrating thing that I see with with with 1010 00:56:05,840 --> 00:56:08,919 Speaker 1: people when they don't want to understand, when they don't 1011 00:56:09,000 --> 00:56:11,239 Speaker 1: ask questions, but they don't want to find out kind 1012 00:56:11,239 --> 00:56:14,680 Speaker 1: of things of like how things operate and how things work. 1013 00:56:15,320 --> 00:56:17,680 Speaker 1: And the last part I would say is advice I 1014 00:56:17,719 --> 00:56:20,920 Speaker 1: would give is be part of a great team. I 1015 00:56:20,960 --> 00:56:23,200 Speaker 1: know when I look back in the best parts of 1016 00:56:23,239 --> 00:56:27,560 Speaker 1: my career, it has always been being part of a 1017 00:56:27,560 --> 00:56:30,359 Speaker 1: team of people that are not competing with each other, 1018 00:56:30,920 --> 00:56:35,120 Speaker 1: but that are working together to compete externally to drive 1019 00:56:35,160 --> 00:56:40,000 Speaker 1: a business forward. That has always been incredibly motivating, stimulating 1020 00:56:40,080 --> 00:56:43,880 Speaker 1: and inspiring to me. And so I encourage college grads 1021 00:56:43,920 --> 00:56:46,520 Speaker 1: to find that team where they're going to be inspired. 1022 00:56:47,280 --> 00:56:50,759 Speaker 1: Quite quite interesting. And our final question, what do you 1023 00:56:50,800 --> 00:56:54,160 Speaker 1: know about the world of banking and startups and investing 1024 00:56:54,200 --> 00:56:57,960 Speaker 1: today that you wish you knew back in nine when 1025 00:56:57,960 --> 00:57:01,319 Speaker 1: you first joined Silicon Valley Bank. Yeah. Probably probably the 1026 00:57:01,320 --> 00:57:04,080 Speaker 1: biggest thing, and I think it's hard until you've gone 1027 00:57:04,120 --> 00:57:08,920 Speaker 1: through cycles is to realize that, um, the challenges, they 1028 00:57:08,920 --> 00:57:11,960 Speaker 1: will come up. You'll learn from those challenges, but they're 1029 00:57:12,000 --> 00:57:14,680 Speaker 1: gonna be over a lot faster than you think. You 1030 00:57:14,760 --> 00:57:17,520 Speaker 1: get so caught up in how challenging or how big 1031 00:57:17,560 --> 00:57:19,960 Speaker 1: of an issue it is, you'll get past it. So 1032 00:57:19,960 --> 00:57:22,960 Speaker 1: don't stress out as much as you do when those 1033 00:57:23,040 --> 00:57:25,960 Speaker 1: challenges occur. You will get you will get through it, 1034 00:57:26,200 --> 00:57:29,840 Speaker 1: You'll be better off and things will be okay. That's 1035 00:57:29,920 --> 00:57:33,000 Speaker 1: terrific stuff. Thank you, Greg for being so generous with 1036 00:57:33,160 --> 00:57:36,560 Speaker 1: your time. We have been speaking with Greg Becker. He 1037 00:57:36,880 --> 00:57:40,680 Speaker 1: is the CEO of Silicon Valley Bank. If you enjoy 1038 00:57:40,800 --> 00:57:44,520 Speaker 1: this conversation, well be sure and check out our podcast extras. 1039 00:57:44,520 --> 00:57:47,840 Speaker 1: Will we keep the tape rolling and continue discussing all 1040 00:57:47,960 --> 00:57:53,400 Speaker 1: things venture and banking related. You can find those at iTunes, Spotify, 1041 00:57:53,520 --> 00:57:57,400 Speaker 1: wherever you find your favorite podcasts. We love your comments, 1042 00:57:57,400 --> 00:58:00,880 Speaker 1: feedback and suggestions right to us at M I B 1043 00:58:01,080 --> 00:58:04,440 Speaker 1: Podcast at Bloomberg dot net. Sign up for my daily 1044 00:58:04,480 --> 00:58:07,400 Speaker 1: reads at Ridholtz dot com. Check out my weekly column 1045 00:58:07,400 --> 00:58:12,160 Speaker 1: on Bloomberg at Bloomberg dot com slash Opinion. Follow me 1046 00:58:12,240 --> 00:58:15,280 Speaker 1: on Twitter at Ritholtz. I would be rumiss if I 1047 00:58:15,320 --> 00:58:17,760 Speaker 1: did not thank the crack team that helps put these 1048 00:58:17,760 --> 00:58:22,200 Speaker 1: conversations together each week. My audio engineer is maroufal Paris 1049 00:58:22,200 --> 00:58:27,160 Speaker 1: Wald is my producer. Michael Batnick is my researcher. I'm 1050 00:58:27,240 --> 00:58:30,560 Speaker 1: Barry Riholtz. You've been listening to Masters in Business on 1051 00:58:30,720 --> 00:58:31,720 Speaker 1: Bloomberg Radio.