The sudden collapse of Silicon Valley Bank (SVB), long considered as the funding backbone of the tech venture capital community, has set off global financial panic and exacerbated uncertainty for the startup ecosystem.

In a press release on Monday, the Federal Deposit Insurance Corporation (FDIC) said it has extended the bidding window for SVB, as it has received "substantial interest from multiple parties," and more time is needed for it and the bidders to "explore all options in order to maximize value and achieve an optimal outcome."

Parties are allowed to submit separate bids for Silicon Valley Bridge Bank, N.A., and its subsidiary Silicon Valley Private Bank by 8:00 p.m. EDT on Friday and 8:00 p.m. EDT Wednesday, respectively, the FDIC said.

Receivers are pending, so is the future of tech startups in many parts of the world.

"Within tech's ecosystem, the bank had molded itself to the quirks and idiosyncrasies of the industry, becoming deeply interwoven to an unusual degree into the lives and businesses of investors, entrepreneurs and executives," the New York Times reported.

The tech-focused lender said on its website that it banked 44 percent of the U.S. venture-backed tech and healthcare companies that went public last year, compared to 55 percent in 2021.

Its failure may result in "a very, very big ripple effect in the startup ecosystem in this country," Michael Wenning, an American tech startup founder, told Xinhua News Agency. "Now this generation will have trouble getting funding. They'll have trouble securing loans because the bigger banks don't want to help them."

A huge gap will be left in the U.S. startup ecosystem in the aftermath of the incident, said Wenning.

Scarlett Spring, CEO and co-founder of TapRoot, a Phoenix-based startup, echoed Wenning, saying the SVB collapse is "terrible for startups in the technology field," in that if the startups cannot receive new investment in time, "they're done."

Morgan Stanley last week warned that a high proportion of startups may not make it to 2024, as funding becomes more difficult to secure.

And the effects reach far beyond the U.S.

"It is common for Indian startups to choose to be incorporated in the U.S. to access capital from global venture capital firms, and the money raised is often deposited in SVB," the Times of India (TOI) reported.

According to country's deputy IT minister Rajeev Chandrasekhar, hundreds of Indian startups had deposits worth about $1 billion in the SVB.

Almost 90 percent of India's SaaS (software-as-a-service) startups with a large customer base in the U.S., and also startups backed by Y Combinator, a U.S. startup accelerator, banked exclusively with SVB, the TOI reported, citing a venture capital investor.

"The issue is, how do we make startups transition to the Indian banking system, rather than depend on the complex cross-border U.S. banking system with all of its uncertainties in the coming month?" said Chandrasekhar.

The SVB demise also rattled Israel's high technology sector, a pillar in the country's economic growth.

Israel has over 6,000 high-tech companies and startups, mostly in the technology sector. An Israel Innovation Authority (IAA) report released in May 2022 showed that high-tech exports made up 54 percent of all Israel's exports in 2021.

It is estimated that 500 Israeli companies banked with SVB, with holdings in the billions, reported the Jerusalem Post.

"Being that SVB is a leader in startup banking and has a strong presence in the ecosystem, it is very likely some of this money – if it left in time – is clogged up in this mess," it added.

In an interview with CGTN, Lu Gang, founder of TechNode, a global startup platform with a focus on innovators in China and Southeast Asia, said the bank collapse could more severely impact startups in Southeast Asia that heavily rely on U.S. investment.

Startups in Southeast Asia are at the beginning stage and companies are eager to raise money from the West, particularly from the U.S., which is also a potential market they are targeting, said Lu.