Let’s be honest: I write more about music than I do about start-ups. But when I DO write about start-ups, I generally confine my meandering discourse to tech start-ups.
However, I’m as interested in Roanoke business generally as I am in the particulars of our burgeoning tech scene, so when a different kind of “start-up” takes off, I think it is worthy of attention.
Enter Valley Bank. Founded in 1995, Valley Bank has been a runaway success here in Roanoke, often with double digit growth, year-over-year. And that has been a real boon to us all, because local banks and banking local are vital to organic growth in small markets like Roanoke. However, that kind of macroeconomic crap is not the point of this post.
Let’s talk instead about Valley Bank’s “exit strategy.”
Like many tech start-ups, Valley Bank built a small, loyal, local following, and when a bigger bank came calling with a cash offer, they sold out. I got a form letter last week from Ellis Gutshal, Valley’s president, saying that the long-planned merger is now official.
This is the start-up dream, right? Build something great and let somebody else scale it for you, taking a fat payday.
I can’t say I blame them, but at the same time, local banks occupy a place of public trust that I feel Valley has broken in this case. Personally, I went with Valley because I liked their community focus, and I have no confidence at all that their purchaser, BNC Bancorp, will give shit one about Roanoke. They are based in High Point, NC. Valley Bank is probably a write-off for them. And I feel a little bit betrayed, and disappointed in myself that I didn’t pick Hometown Bank instead.
Banks matter in tangible ways in the lives of individuals that tech companies, even big ones, just do not. Think about it: Facebook buys Oculus, and nothing changes for anyone other than the employees of Oculus; but a local bank like Valley gets bought out, and suddenly it is a little bit harder for all of us in Roanoke to get a mortgage. Whether the issue is a home loan or a business loan, they’ll say their underwriting will stay in-house and all decisions will be local, but that will NOT be true. Instead of a personal banking relationship, Valley’s customers will be dealing with the local representatives of far away shot calllers.
I kinda think that sucks.