Rich guy in the kitchen with the candlestick. As the hours following the collapse of Silicon Valley Bank passed into days, and then finally our first week, the chaotic early takes rapidly evolved from tweets to pieces to actual positions. At this point, we now know venture capitalists were, and continue to be, The Problem — not the failed bank, not the regulatory framework within which the failed bank functioned, but a small subset of highly-visible investors who viciously, unthinkably put money in a bank that failed. The specific manner of the VCs’ evil has settled into three distinct genres.

First, from media voices philosophically amenable to a position that the financial system should protect depositors: a personal dislike of David Sacks, a prominent venture capitalist with a popular podcast, means let it burn (or don’t (all that really matters here is we think David is annoying)). Second, from finance bros with whacky internet personas: an opportunity to finally scapegoat another class of rich person means maybe startups should actually not exist. Third, from literal communists: an earnest belief that venture capitalists, who are capitalists, should simply all be executed (not really though, “I’m just referencing famed economist John Maynard Keynes,” wink wink *guillotine GIF*).

Now, I do think it’s worth acknowledging venture capitalists really are, for the most part, incredibly annoying. There is a reason for this. A venture capital firm is just money, and beyond a startup’s Series A the game of venture capital mostly consists of persuading the very best entrepreneurs to take money from you rather than the other guy. This dynamic naturally places a great prominence on brand, or reputation. Among top VC firms, reputation is mostly made by record, both as a great ally to founders, and — most importantly — a winner. But for firms or venture capitalists with less of a track record, you’ve pretty much just got Twitter. Given venture capitalists are also people who tend to have a lot more time on their hands than they’d generally like you to think, this is a recipe for incredibly dramatic status games, all played loudly out online, which is just to say I get it. I can’t stand a lot of these people myself, many of whom have spent the last week begging journalists to write hit pieces on my friends at Founders Fund, as it is easier to demonize a firm for acting responsibly in the middle of a crisis than it is to introspect and ask oneself difficult questions like “why did I tell my founders to sit still in the middle of a burning house,” and “how did I, a person literally professionally meant to understand risk, not understand this?”

But as annoying as you — we all! — may find venture capitalists, they aren’t responsible for the failed bank. Encouraging their portfolio companies to limit their exposure to the failed bank in the middle of a bank run? That was still the right decision. Then, finally, pretending this relatively small class of investor is the most powerful and deadly class of people in the country is honestly just stupid for purported haters, given this hysteria plays directly into venture branding as in some sense Very Important. Almost none of these people are important. You are all, like a fat kid who loves Lucky Charms commercials, eating marshmallows for breakfast.

Idiots.

Let’s begin.

ONE. The Competition.

Out of the gate, I pointed to Matt Yglesias as an interesting benchmark of standard left opinion on the “bailout.” Depositors, who took no further risk than keeping their money in a bank, were suddenly facing total obliteration. Clearly, eroded trust in banking posed existential risk to the entire financial system. While Yglesias seemed to understand this, he still appeared to find the disaster funny, and wanted depositors at Silicon Valley Bank specifically to suffer.

What’s important here is Matt isn’t targeting David’s opinions. He isn’t targeting David’s record. He’s targeting David’s podcast. This may seem trivial, but it’s the only really honest element of Matt’s position. Sacks isn’t just one of the few actually good venture capitalists who also tweets, he has an extremely popular podcast. This places him in direct competition with his critics in the media.

After some reflection, Matt approached the subject in longer form, suggesting all regional banks should fail, leaving America with a few very large banks only — presumably nationalized, or something close to nationalized. That the Biden administration appears to have prevented larger banks from buying SVB at the top of the crisis, leaving depositors with no hope at solvency but the very government intervention he ridiculed, didn’t make it to the piece. Matt did however rather charitably include an anecdote concerning his own salvation from a failed bank, in which a larger bank was allowed to save him from personal crisis, once again calling starkly into question his “let it burn” sentiments concerning the depositors of SVB. This is because, again, Matt’s position isn’t really about banks. It’s just about David Sacks.

Kara Swisher, who has apparently returned to Twitter after loudly quitting over Elon Musk’s ascension, demonstrated similar opinion. On one hand, depositors should be protected.

But on the other, depositors should not be protected.

The apparent contradiction here is only confusing until you remember Kara’s politics, which are just ‘whatever Biden says this week is what I am defending.’ It took Biden a minute to form an opinion, and so it took Kara a minute to share his opinion. As with Matt, however, the more noteworthy aspect of Kara’s critique is the degree to which it is all chiefly concerned with David Sacks.

We disagree, Kara says. But do they, even? Where are they in disagreement? The important thing, as ever, is “why don’t you join me on my podcast, and we can discuss.”

TWO. The Scapegoat.

I didn’t fully understand the depths of Wall Street’s contempt for tech until Joe Weisenthal, Bloomberg’s chief proponent of a trillion dollar coin, ran a poll on the question of whether venture-backed startups should even exist.

Joe’s fans attempted to defend his commentary as an elaborate troll, given they improbably still love him from some alleged previous era in which he was funny or something. But, as he expanded on his thinking, he introduced a real issue — all of these people (startup founders, venture capitalists) know each other.

A similar critique was levied in the New York Times by infamous gossip columnist Elizabeth Spiers, the founding editor of Gawker, who also believed the problem was startup founders speaking to each other.

Presumably, in a world after Stonks, we are meant to believe the (real) danger of memetic mass action is in some way rooted in group chats rather than the open internet. Okay.

But mostly Joe was drawing from his colleague Matt Levine, who argued nearly as explicitly along the lines that depositors — or, these depositors specifically — were the real problem with SVB.

In his analysis, Levine opens with the genesis of the bank run, which he believes consists primarily of a desire among venture capitalists for attention on Twitter. But they’re sorry, he writes, for “what they did.” As noted at the top of this piece, it is absolutely true that VCs love attention. But that their thirst for attention caused a bank run is an odd position given no prominent venture capitalist allegedly responsible for the bank run tweeted about it until it was over, presumably on account of they were busy attempting to save their companies, and there is not a single person who wishes they’d kept their money in the bank.

“But I think that the story of SVB’s failure has turned out to be that SVB was the banker to tech startups,” Levine continues, “and tech startups turned out to be incredibly dangerous customers for a bank.”

Levine never explains how, though does imply venture capitalists force banks to assume risk, another claim that makes zero sense at face value, given there has never been a person in the history of business who has preferred a bank that takes a lot of reckless risk, which he can in any case not back up. In fact, he doesn’t even try. He just moves along.

“As I said above,” he concludes, “the basic story of the fall of SVB is that venture-backed tech startups plowed too much money into SVB too quickly in the boom times, and took it out too quickly last week. SVB had nowhere to put that money except in long-dated government bonds with lots of interest-rate risk; when rates went up those bonds lost money, and when its depositors all fled last week it realized those losses and went bust. The depositors were the problem.”

Fascinating. There was nothing the bank could have done differently? SVB was forced to lobby the government for looser regulations? SVB had no choice but to plow itself into mortgage-backed securities? The bank, presumably run by finance professionals, could not have been expected to anticipate the impact of rising interest rates? Really, the fault lies with startups? Simply for having money and putting it in a bank? In other words, for existing?

To his credit, Levine notes he’s a former employee of Goldman Sachs, which has itself been blamed (also unfairly, in my opinion) for destroying SVB. All I can assume here is he’s attempting to put a fire out for his old friends by offering a tasty new target in their place. Because nothing else about his position makes sense.

THREE. Communism. Sure, why not.

In our last bucket, there is some earnest sentiment from the (very) far left, beginning with what appears to be a call to literally execute venture capitalists. From Slate:

Shortly after Ed achieved his goal of attracting attention from the people he dehumanized as “parasites” before suggesting they be euthanized, he clapped back, repeatedly and breathlessly, with a hopeless rolling of his eyes, and a kind of ‘do you see the idiocy I have to deal with.’ You’re all a bunch of poorly read losers, he argued. “Euthanized” is just a reference to famed economist Alfred Maynard Keynes!

First and most obviously, there is a difference between “euthanasia” of a concept, and dehumanizing a group of human beings before suggesting they be euthanized. As everyone understands this and doesn’t seem to care, I know I run the risk, here, of tedium. But I do want to quickly unpack this for the record. Ed is a writer for Jacobin, a pro-violence socialist magazine that famously sells a poster of a guillotine on its website, and key weapon of the dirtbag left. This is a political scene that looks forward genuinely to the mass execution of rich people.

Jacobin is — and I can’t believe I need to point this out — also this man’s handle. “Bigblackjacobin,” a plucky reference to the French Terror, one of the most famous mass murders in history. As if to leave no ambiguity on the matter, while at the same time denying his initial honesty, Ed concludes with a defense of communism, a political philosophy responsible for the death of something close to 100 million people, including famously the ritual mass murder of the ‘capital class.’

But beneath all of the cucked “someone else should kill the people I don’t like” pro-murder shit, Ed is really just a basic bitch at heart. His piece argues venture capitalists should not exist, suggesting maybe we (not me, as I will be dead) should fund startups at the behest of a caring mix of — I guess — social justice philosophers, academics, and Ed, presumably, our anointed chief communist specifically, who will rule the grand undertaking of America’s technological destiny with his ascended ethics.

The good news is, for Ed to realize any possible future scenario in which everyone he hates is murdered, the barista class will have to take up arms. My position here is not that they can’t win, but it will, at least, be funny to watch them try.

More to come.

-SOLANA