Updated: Apr 19
One of my clients calls Friday March 10 “the day the bank died” - i.e. the day Silicon Valley Bank was shut down. For many startups (like most of my clients), it was terrifying; the team's funding had potentially vanished overnight. From Friday afternoon until Monday morning, everyone was left wondering how to make payroll and which difficult decisions they'd have to make to keep the company alive.
The SVB situation sent almost every team I coach into "crisis mode" for 3 days.
Now that we're on the flip-side of this moment, most of my clients have taken some very tactical take-home messages from this event: make sure to balance your banking portfolio so that any one bank failure will not cripple the company ever again.
I'm wondering: What else did you learn from the SVB experience?
How did your team do managing the SVB crisis? What decisions would you have made if most of your funding truly disappeared? What was your communication plan for sharing information with the rest of your team? What did you notice about your ability to manage yourself? When the news came out that funds were restored fully, what did you do to support your team to help them move forward?
One of the questions that the SVB situation surfaced with my clients is: How transparent should I be in a crisis? As a leader, do we tell our team everything - or should we filter information?
I think there’s no right answer here, but I will say that it’s important to communicate often. “Here’s what we know right now. Here’s what we’re doing to make sure you - and the company - are going to be okay.”
In a crisis, I believe in transparency - but it’s also our job to buffer others from unnecessary stress. I encouraged my clients to say: “We’re going to work over the weekend on a pivot plan in case our money is gone. We’ll share our plan with the full team over Zoom on Monday at 12 PM.” This way your team knows exactly when you will share more information with them.
What good will it do to tell your team which of them would be fired if you had to reduce headcount? Personally, my morale would be shot if someone told me that. If the threat passes and my team is mostly unaware of how scary it could have been, maybe that’s OK?
I’ve had to manage quite a few emergencies. One of the most stressful crises I had to manage was at MIT, when I lead a team of 10 students through a shelter-in-place with an armed shooter on campus.
I will never forget that day. It was my first fellow training day at MIT. I had 9 PhD students and 1 postdoc on campus in building 56/16 for a full-day retreat on a Saturday. Campus was quiet and we were sitting in the middle of a room with enormous windows.
I got an alert mid-morning from the MIT Police that there was an armed shooter on campus and we were told to shelter in place. I remember thinking to myself, "I am responsible for 10 students' lives and we are extremely exposed in this room with all of these windows. We can’t leave. What are we going to do?"
I immediately stopped our training and calmly told everyone what I knew about the situation - which wasn’t much more than what they already knew from their own alerts. I remember we quickly put up giant post-it notes on the windows to give us a little more protection. I asked each student to text or email their important people and make sure to share where they are and that they’re OK. I wrote the department head to make sure he was keenly aware that I was on campus with 10 students. I checked in on the team, emotionally: "How is everyone feeling? Who needs what?"
I facilitated a quick discussion with the group about what we wanted to do. "Is anyone too scared or worried to continue with our training? It's absolutely okay to say you are scared. This is scary." I made sure they knew we could reschedule. What mattered most to me was that they felt safe. I remember that I worked very very hard to appear extremely calm in order to help them stay calm, too.
Within a couple of hours, the police reported an “all clear.” When we finally were able to leave, I remember that my team felt stronger because of how we handled the situation. I also remember that I completely forgot to alert my important people - I was entirely focused on making sure my team was okay.
I’ve realized, over time, that I’m one of those people who can stay eerily calm in the eye of the storm. It’s usually not until the threat has passed when it catches up with me. I can bandage up someone's bloody arm - and then throw up hours later. During an emergency, I compartmentalize my feelings and focus on what needs to be done.
I’m curious to know if the SVB situation helped you learn about how you manage a crisis - and how your team does, too?
Before this moment is entirely in the rear view mirror, it’s worth asking: "What can we can learn from it?"
I hope - for all of our sakes - you don’t experience another crisis any time soon. But if you do, taking a moment now to reflect will help you be better prepared for whatever is coming.