SVB Collapse Hits Hollywood Payroll Firm Wrapbook, Which Says Payments Will Be Delayed by Bank’s Shutdown
In the wake of the sudden collapse of Silicon Valley Bank, Wrapbook, a company that provides payroll services for TV and film productions, said payments submitted through its platform will be subject to delays.
In messages to clients Friday, Wrapbook said payroll-processing delays caused by the failure of SVB — which came after a historic run on the bank’s deposits — may continue into next week.
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The shutdown of SVB “will cause payroll to be delayed today, March 10th 2023, and impact the processing of uncashed checks,” Wrapbook said in a statement. The company said it is working to resume payroll processing with SVB while at the same time seeking to process payroll payments with another banking partner.
“A bank failing is an extreme external event. We apologize, on behalf of all of us at Wrapbook, for any challenge this puts on you,” the company said in the statement.
SVB’s collapse has affected a number of other companies, particularly in the tech sector. On Friday, streaming company Roku said 26% of its cash on hand, about $487 million, had been held at SVB. “The company’s deposits with SVB are largely uninsured. At this time, the company does not know to what extent the company will be able to recover its cash on deposit at SVB,” Roku disclosed in an SEC filing.
On Thursday, March 9, investors and account holders tried to withdraw $42 billion in funds from Silicon Valley Bank, according to a California regulatory filing — one of the biggest runs on a bank in more than a decade, according to Bloomberg.
On Friday, the FDIC took control of SVB’s $175.4 billion in deposits. Up to $250,000 of customers’ holdings were insured by the regulator. Above that, the bank’s customers right now are in the dark about when they might be able to access their funds. “Customers with accounts in excess of $250,000 should contact the FDIC toll-free at 1-866-799-0959,” the regulator said in an announcement.
Wrapbook, founded in 2018, operates a platform designed for production companies to manage on-boarding, payroll, insurance and other functions, as well as to let cast and crew members and employees track their payments. CEO Ali Javid has described the company’s mission as to “create easy-to-use financial service solutions that support and increase the prosperity of the project economy.”
In the fourth quarter of 2021, investment firm Tiger Global Management led a $100 million Series B funding round in Wrapbook with new and existing investors including Jeffrey Katzenberg’s WndrCo, Uncork Capital, Andreessen Horowitz, A* and Equal Ventures. According to the company, that gave it a $1 billion valuation. Previously Wrapbook announced a $27 million raise led by WndrCo with participation from investors including Michael Ovitz.
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