Big or small, every business has one thing in common: Their banking relationships are vital to success. In early March, a crack in the U.S. banking system quickly escalated to a fracture. By March 10th, the U.S. government had taken control of Silicon Valley Bank (SVB), a key partner to many companies in the technology ecosystem, after depositors withdrew billions in funds. After being placed in receivership, SVB was sold to First Citizens .

In light of these events, and the continuing macro-economic uncertainty, many finance teams are reevaluating their own treasury-management approach to make sure they’re managing their available cash optimally. On our recent Treasury Management Webinar, Battery General Partner Russ Fleischer moderated a discussion between Brian Kinion, CFO at Battery portfolio company MX* and Adam Danni, a senior treasury manager at portfolio company Collibra*, to share best practices in this rapidly changing financial environment. Here are some key takeaways from the session.

1. Don’t underestimate the importance of redundancy.

“Don’t keep all your eggs in one basket” is a well-known proverb for good reason. Businesses that stashed too much–or all–of their cash at SVB learned that lesson first-hand. SVB depositors with more than $250K in cash at the bank had zero guarantee that the Fed would make them whole (as it nevertheless decided to do two days after the bank’s collapse). If that hadn’t happened, many companies would have faced an unprecedented cash crisis and been unable to make payroll; many might have had to furlough employees or cease operations. (Some companies were compelled to keep large amounts of operating cash at SVB as a condition of venture-debt agreements.)

Interruptions in service can happen for a myriad of reasons, not all of which are as extreme as the SVB collapse. A multi-bank strategy is essential for mitigating risk exposure, especially to ensure that all your business’ essential cash needs can be met.

Consider not just partnering with multiple banks, but mixing the size of the banks you are working with, as well. The FDIC policy of insuring only up to $250K in deposits per account remains in effect.

2. Consider insured cash sweeps

Some banks can offer a service known as insured cash sweep, which can help diversify risk on the FDIC side. This service makes it possible to get FDIC insurance on balances above the standard $250K limit, all while retaining access to your money and earning interest.

Essentially, participating banks pay a fee to be able to access other banks in the FDIC network. A business can make a deposit above the standard FDIC maximum of $250K that is then divided into smaller amounts up to that limit and transferred to other ICS Network banks.

3. Don’t be afraid to reevaluate (and even renegotiate) your bank partnerships regularly.

Most business partnerships undergo a new RFP periodically to realign and ensure the relationship is still mutually beneficial. Brian Kinion suggests the same should be done for your core banking relationships.

Consider doing this annually: Things can change pretty drastically year-to-year. Evaluate the fees you’re paying. Are you still getting the right rates? Are there ways you could gain more operating leverage? Does the bank have the right technology to keep pace with your growth?

Your banking relationships are mission critical; you should make them the absolute best they can be.

4. Set up automatic sweeps to take full advantage of today’s interest rate environment.

When it comes to excess cash management, the goal is clear: maximize interest return. In today’s rising interest-rate environment, consider investing as much cash as possible.

One way to set your business up for success is by implementing automatic sweeps from operating accounts to interest-earning deposit accounts. This is one tactic that Danni implemented at Collibra. He explains, “there was a minimum balance required in the operating account, and anything that came in over that would automatically sweep into an interest-bearing deposit account. If we made payments out of that operating account that exceeded, say, the minimum balance, it would automatically sweep back into the operating account.”

This automation can be especially helpful for smaller teams where there may not be bandwidth to manage this process day-to-day.

5. Establish board-approved investment policies and foster transparency and open communication with the board around investments.

Let’s face it: In today’s environment, nearly every company’s board likely has more than a few questions about cash policies. Following agreed-upon investment policies and maintaining open communication about investing activities is crucial.

Aim to break things out in as much detail as possible in the policy. Include not only your investing plan, but also your risk-mitigation strategies. At each board meeting, take some time to share updates. What have you achieved? What setbacks have you faced? How are you handling those setbacks?

6. Maintain a 360 view of liquidity reporting.

Different stakeholders require varying levels of detail for liquidity reporting, but it’s all important. Make sure you are set up to see daily cash flow to inform forecasting, which will help you understand your short-term liquidity needs as well as where you can invest longer-term, or move money to money markets to make it more sizable.

Your CFO should have a dashboard with daily cash balances showing variance day over day, week over week, and month over month. If there are any large variances, make sure to identify the root cause and make it clear to informed parties.

7. Stay connected to your network, even when the waters are calm

In the chaos of the fast-moving SVB situation, Kinion recalls: “I was literally tethered to my desk, not sleeping, but staying in contact with all my CFO friends.” His network was able to share information amongst themselves about how to get ahold of certain people or access different accounts.

Even in the absence of chaos, there’s always value in learning from colleagues, especially those whose companies are at varying stages of operational maturity.

Treasury management might not be the sexiest topic, but it’s certainly a timely one – and not an area any company can afford to see go sideways. Advance planning can help your team mitigate risk, maximize cash returns and access, and avoid cash crunches while stretching your runway.