People line up outside of the shuttered Silicon Valley Bank (SVB) headquarters on March 10, 2023 in Santa Clara, California.

Justin Sullivan | Getty Images

Three years ago, JPMorgan Chase executive Doug Petno was at a New York City party celebrating a colleague’s retirement when his boss, Jamie Dimon, called Petno over.

It was March 9, 2023, and the customers of a West Coast lender known for catering to startups had been withdrawing deposits in droves.

“Jamie looks at me and says, ‘Get on this call,'” Petno told CNBC this week in an exclusive interview.

On the line were regulators with an urgent question: Was JPMorgan interested in buying Silicon Valley Bank?

California’s finance regulators seized SVB the next day, completing the sudden collapse of an institution at the heart of the American startup community. Over that weekend, Dimon, Petno and other JPMorgan leaders repeatedly weighed whether they should purchase the bank, which had just lost $42 billion in deposits. They decided against it, in part because thousands of SVB clients were signing up for JPMorgan accounts, anyway, in a flight to safety.

“We had three years’ worth of incoming clients in a weekend,” said Petno, who is co-head of JPMorgan’s commercial and investment bank. “Onboarding teams were opening up accounts around the clock.”

Emboldened by what they were seeing, Petno had an idea: What if JPMorgan could build a true competitor to SVB — as well as startups Brex, Ramp and Mercury — all of whom had carved a profitable niche serving founders and venture capital investors?

“We went to our board and said, ‘there’s a vacuum in the market,'” Petno told CNBC. “At that very moment, everybody saw the opportunity.”

Keeping tabs

For JPMorgan, already a giant in Main Street and Wall Street finance, winning the more specific niche of startup banking from West Coast rivals is about more than gaining deposits. It’s both a key element of the growth strategy for a bank with more than $180 billion in revenue last year, and also a means to help the New York-based lender stay close to technology developments for itself.

JPMorgan, with a tech budget of nearly $20 billion this year, is aiming to not only serve startup clients and VC investors better, but to learn from them. The firm keeps a close eye on Silicon Valley startups for solutions to problems the bank itself faces, from cybersecurity to quantum computing.

In fact, when a JPMorgan client announces a round of artificial intelligence-related cutbacks to jobs and expenses, the firm will often send a team of bankers to investigate how the client is doing it, said Petno.

Typically, the bankers find that implementing new AI agents is only a fraction of the reason for layoffs, while other factors like over-hiring and inefficient processes account for the rest, he said.

Co-CEOs of Commercial & Investment Bank at JPMorganChase, Troy Rohrbaugh and Douglas Petno.

Courtesy: JPMorganChase

JPMorgan began its startup banking business in 2016 as it became aware of its tech-focused rivals during its westward expansion. In the beginning, it only served bigger, more mature startups.

That’s in part because the bank didn’t yet have a digital banking solution that younger founders in particular craved, Petno said. It also didn’t have enough investment bankers at the time to target smaller, riskier startups.

For years, the view on JPMorgan from some in the VC community was that it took too long to open an account, or that resolving issues around payments involved dealing with time-consuming visits to a branch, investors told CNBC.

“They want to go to the website to open an account, and if it’s more than 15 minutes, they’re done,” says Petno.

But in the weeks that followed the SVB collapse, Petno and his team moved quickly, hiring a few key players from SVB, including then-SVB Capital President John China, who today leads JPMorgan’s innovation economy business along with Andrew Kresse.  

By late April of 2023, JPMorgan found itself looking at buying another wounded California-based bank. This time, it made the winning bid for First Republic, which also catered to the tech community.

With fresh learnings from SVB and the banking operations of First Republic, JPMorgan doubled its revenue from startup banking in 2023, according to the company.

Despite the digital banking focus, a startup founder will still sometimes walk into a Chase branch to deposit a huge funding check into a regular account. Now, when that happens, JPMorgan’s systems immediately gets that client moved to the startup team, Petno says.

Killer app?

JPMorgan has now quadrupled the number of total clients it has in the business to nearly 12,000, served by 550 bankers on both coasts, according to the lender, all of whom draw resources from different parts of the company.

Founders and VC investors are clients of the private bank, while the startups are covered by the commercial bank and VC funds are separate clients in a business largely acquired from First Republic.

While JPMorgan declined to give specific revenue figures, Petno said the startup business had a “dramatically higher” growth rate than the bank’s main business lines.

And yet, Petno still isn’t satisfied with the firm’s digital banking offerings for startups, describing a project underway that will help them leapfrog competitors.

Besides SVB, which is now owned by First Citizens Bank, and the startups Mercury and Ramp, competitors in the space include Stifel and Customers Bank. In January, Capital One acquired Brex for $5.15 billion.

Since most startups fail, JPMorgan identifies companies that it expects to be winning bets, seeking to develop relationships with them earlier in their life cycle, like SVB did.

That way, it can provide not only core bank accounts, but lucrative investment banking advice along the way.

JPMorgan’s ultimate vision is to become the one-stop shop for founders, serving all their needs, including international expansion, from the seed round to initial public offering and beyond.

“Once you’re onboarded, you can never outgrow JPMorgan, from unicorn all the way to a Magnificent 7,” Petno said.

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Henrique Braun to become the next CEO of The Coca-Cola Company.

Courtesy: The Coca-Cola Company

Coca-Cola Chief Operating Officer Henrique Braun will succeed James Quincey as CEO next year, the company said Wednesday, as Coke and its rivals navigate tepid consumer demand for soft drinks.

The change will take effect on March 31, and Braun will be nominated to the company’s board of directors, Coca-Cola said. Quincey will stay on with the company as executive chairman of its board.

Quincey, 60, has held the top job at the beverage giant since 2017. During that time, he oversaw the refranchising of Coke’s bottling system, the company’s strategy through the Covid pandemic and its focus on beverages perceived as healthier.

Braun, 57, has held various roles at Coke since joining the company in 1996, the same year that Quincey joined. Braun became COO at the beginning of the year.

In a release, Coca-Cola said Braun will focus on identifying new growth opportunities around the world, better filling consumer needs and improving the company’s technology.

James Quincey, Coca-Cola CEO, speaking on CNBC’s Squawk Box outside the World Economic Forum in Davos, Switzerland on Jan. 22, 2025.

Gerry Miller | CNBC

The leadership change comes as the beverage company tries to reverse slower demand for its sodas, which still account for a significant amount of its global sales. In Coke’s third-quarter, global unit case volume — which strips out pricing and foreign currency changes — rose 1% after falling in the previous three-month period.

Quincey has said lower-income consumers have bought fewer of its drinks, and the company has rolled out cheaper and smaller versions of its products to try to reverse the trend. However, pricier brands like Smartwater and Fairlife have performed better than its soda segment in recent quarters, suggesting that consumers are willing to pay more for some brands.

Coca-Cola has also largely outperformed rival Pepsico during Quincey’s tenure, in part due to its stronger out-of-home business in venues like restaurants and movie theaters.

Coke is also winning the soda wars. Its namesake soda has held onto its spot as the best-selling soda in the U.S., and Sprite surpassed Pepsi to become the No. 3 soda in the nation.

Stock Chart IconStock chart icon

Coke’s stock has outperformed Pepsi’s in recent years.

Coke shares were largely unchanged in extended trading Wednesday. The company’s stock has climbed nearly 13% this year, while Pepsi shares have fallen more than 1%.

Coke’s market cap of more than $300 billion outstrips that of Pepsi, which has a market value of roughly $200 billion.

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