THE PHONE CALL came at a retirement party. It was March 9, 2023, and JPMorgan executive Doug Petno was celebrating a colleague's career when Jamie Dimon pulled him aside to join a call with regulators asking a simple question: did JPMorgan want to buy Silicon Valley Bank? The answer, ultimately, was no — but only because JPMorgan was already getting what it wanted for free.
When SVB lost $42 billion in deposits and collapsed the following morning, the ensuing flight to safety delivered what Petno describes as "three years' worth of incoming clients in a weekend." Onboarding teams worked around the clock. JPMorgan, which had tentatively entered startup banking in 2016, suddenly found itself holding the keys to a market it had long coveted but never cracked. The bank has since quadrupled its startup client base to nearly 12,000, served by 550 bankers on both coasts. Revenue from the unit doubled in 2023 alone. By late April of that year, JPMorgan had acquired First Republic — another California lender serving the tech community — giving it both the client relationships and operational muscle to build what Petno pitched to the board as a full-spectrum competitor to SVB, Brex, Ramp, and Mercury.
Deposit flight, deposit fight
Yet becoming the startup world's one-stop shop requires more than catching panicked depositors. The pitch is seductive: serve founders from seed round to IPO, layering in private banking for individuals, commercial banking for companies, and investment banking for liquidity events. JPMorgan's $180 billion revenue base and nearly $20 billion annual tech budget give it resources no fintech upstart can match. The bank even dispatches teams to study how its own clients deploy AI — treating its startup portfolio as a kind of applied research lab for the parent institution.
But JPMorgan's history in the space suggests the behemoth still has habits to unlearn. For years, VCs told CNBC, the bank's reputation among founders was one of sluggish onboarding and branch-dependent problem solving — precisely the friction that made SVB and its digital-native successors attractive in the first place. "They want to go to the website to open an account, and if it's more than 15 minutes, they're done," Petno concedes. The bank hired key SVB alumni, including former SVB Capital president John China, to inject startup fluency into an institution built for Fortune 500 treasury operations. Petno acknowledges the digital platform still is not where it needs to be, describing an internal project he reckons will help JPMorgan leapfrog competitors — though he declined to share details.
The competitive field, meanwhile, has not stood still. First Citizens Bank now operates the SVB brand and retains deep Valley relationships. Capital One acquired Brex in January for $5.15 billion, signaling that incumbent banks broadly view startup finance as a lucrative adjacency worth paying up for. Mercury and Ramp continue to grow among early-stage founders who prize speed over balance sheet size. And Stifel and Customers Bank have carved out their own niches. JPMorgan's advantage — its sheer scale and ability to serve clients across every stage of growth — is also its liability; startups that prize agility and founder-friendly culture may find a megabank's bureaucracy suffocating, however many SVB veterans it hires.
There is also the question of survivorship economics. Most startups fail, which means JPMorgan's model depends on identifying winners early and cultivating relationships that pay off years later in IPO advisory fees and secondary offerings. SVB managed this trick for four decades by embedding itself so deeply in the VC ecosystem that banking there was a cultural default, not a rational comparison. Replicating that gravity — from New York, inside a $4 trillion institution — is a different proposition entirely.
Still, the numbers suggest JPMorgan's startup unit is growing at what Petno calls a "dramatically higher" rate than the bank's core businesses, even if the firm declines to put a dollar figure on it. The real test comes when the IPO window reopens in earnest and JPMorgan discovers whether the thousands of founders who fled to safety in 2023 have become loyal clients — or merely cautious ones waiting for a better offer. In startup banking, as in startups themselves, acquiring users turns out to be the easy part. ■
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