The company was “pushed around” by the collapse of the SVB, says the small business owner
- The collapse of Silicon Valley Bank sent startup founders and venture capitalists into a panic last weekend.
- The founders of Asian food startup Omsom have shared the company’s experience on social media.
- Vanessa Pham said the collapse of the bank threatened small businesses in addition to rich VC firms.
Vanessa Pham was showing off her BBQ sauce with lemongrass and yuzu miso glaze at the annual Expo West conference last Thursday when she first heard about the Silicon Valley bank’s struggles.
Co-founders exchanged articles and were urged by investors to withdraw their funds, Pham, the CEO and co-founder of Asian food company Omsom, said in an email interview with Insider. The news sent Pham spiraling: All of Omsom’s money was in SVB, a bank often used by startups and venture capitalists.
Pham immediately reached out to her sister and co-founder Kim, saying their conversation “went from shock and disbelief to fear and concern at the impact on the business.”
On Friday morning, Pham tried to wire the company’s money to the SVB but was unsuccessful. That afternoon, the SVB was shut down by federal authorities and depositors lost access to their accounts.
The sisters immediately went into “problem-solving mode,” Pham said, with Kim using her previous experience in VC to reach out to the company’s investors for help. Pham’s background in consulting helped her plan for the different outcomes that could occur depending on how much access they would have to their funds.
They also visited other small business owners to offer resources and encouragement.
“There were offers to introduce each other to new banking partners, to share promising short-term loan providers, just to be there for each other,” Pham said. “It was honestly quite touching.”
The co-founders wrote a letter to clients about what SVB’s collapse meant for the company and shared it on Instagram and LinkedIn. In the letter, they wrote that they weren’t seeking pity, but wanted to let people know what it was like “navigating a recession, the hangover of a pandemic, socio-political trauma and now the second largest bank failure in American history.” “
They urged customers to stock up on Omsom products, buy gift cards and share Omsom’s mail. The Instagram post has over 15,000 likes, and Pham said the two posts combined amassed over half a million impressions.
“To see our community gather, anchor and grow over the past few days has been so humbling and stimulating,” Pham said. “Our focus now is on how we can prevent this from happening in the future and how we can continue to show up for our amazing community, ride or die.”
On Sunday, federal authorities announced that SVB depositors would be granted access to all of their funds the next day. For Pham, it was a feeling of pure relief.
In a subsequent Instagram post, the Pham sisters wrote that the weekend got them thinking about how “the failure of America’s banking system has blown us all away, small businesses and consumers alike.”
Pham said it’s a common misconception that SVB’s collapse only poses a threat to larger institutions — like wealthy VC firms or big startups. It’s often “the smallest, most marginalized groups that feel the impact the most,” she said, like Omsom, a startup company.
The Omsom team wanted to be transparent about their experience with SVB, Pham said, because their community has been so supportive, especially during the pandemic when the company was first formed.
“Being proud and loud is in the company’s DNA, and that means not just celebrating the wins, but actually peeling off the layers of what it’s actually like to run a small, queer-owned WOC company,” Pham said . “The last few years have shown us that consumers are realizing that they can make real change with their money and their voice – they are not only looking at what goes into their products, but also who stands behind them and what their values are. “
Omsom is now conducting its due diligence with investors and advisors, including working with other banks and diversifying where the funds are held, she said.
“On the product side, our goal is to ensure that Omsom’s offerings, which represent the diversity of Asian cuisine and culture, shine given the uncertainty that surrounds us both inside and outside of the SVB crisis,” said Pham.
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