HR and staffing firms said they are confident in the Indian economy and predict the SVB collapse will have minimal to no impact on the talent market in India.
The collapse of Silicon Valley Bank (SVB) has created uncertainties in the talent market for Indian startups, which are estimated to have had deposits worth about $1 billion with the lander.
Regulators shut down SVB, which had $209 billion in assets at the end of 2022, on March 10 after a run on the lender.
However, HR and staffing firms said they are confident in the Indian economy and predict the SVB crisis will have minimal to no impact on the talent market. Though factors such as a slowdown may cause an imbalance in the Indian talent market, experts said the SVB collapse alone will not affect it.
Active talent demand from tech startups had dropped to one-third of its typical volume during the second half of 2022, data by specialist staffing company Xpheno showed. It has since remained in the less than 20,000 range and slowed down the velocity of hiring.
“The after-effect or an immediate impact of the SVB collapse is hence not showing up as a blip on the talent radar,” Kamal Karanth, cofounder of Xpheno, told Moneycontrol.
Nevertheless, he said the specific impact of the SVB collapse on layoffs and attrition will vary across the three major types of associations that startups have had with SVB.
Lower liquidity
The first and potentially least hit would be startups that built their reserves and deposits at SVB and there are interventions underway to secure, recover and repatriate these reserves.
“For these startups, it’s largely an inconvenience of lowered liquidity and speed to funds. This group has a way out of the situation and will not necessarily go through the strain of layoffs. Short-term austerity would be a word for them,” Karanth said.
In a tweet, a 116-year-old Mumbai bank called SVC Bank, which was in trouble after SVB’s collapse clarified that it had no relation to SVB.
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