Erebor Bank raises $8B valuation as it targets SVB’s tech lending market

Erebor Bank is raising fresh capital at an $8 billion valuation as it targets the technology and defense customers once served by Silicon Valley Bank, Bloomberg reports. The valuation is nearly double the $4.35 billion it reached in a funding round late last year. The Ohio-based lender received its banking approvals this year and has drawn customers from technology and defense firms in California. Erebor said it added hundreds of customers in the second quarter. Founder Palmer Luckey told Bloomberg in July that none of the new customers were his own companies. Erebor was founded by Luckey and is backed by Peter Thiel’s Founders Fund, Andreessen Horowitz and other venture capital investors. Its stated mission is to fill the gap left by SVB, which specialized in lending to technology startups before its collapse in 2023. Luckey told The Wall Street Journal in February that Erebor aims to understand its borrowers like a specialized lender. Bloomberg Opinion columnist Paul J. Davies wrote that this concentration creates risks because many technology borrowers are unprofitable or have limited revenue. The bank plans to use blockchain technology to let customers move money around the clo...