Leader Bank's branch in Cambridge's Central Square. Banker & Tradesman file photo

Arlington-based Leader Bank has become the second Boston-area community bank to intentionally pursue clients in the region’s tech economy with the hiring of eight-year First Republic Bank veteran Vitaliy Schafer.

“This is something we’ve been wanting to do for about five years, but we weren’t really able to find a way to properly wedge into it because [Silicon Valley Bank] and First Republic had a lock on the market,” Leader Bank President Jay Tuli said. “We’ve taken our time to bring the right person in.”

At First Republic, Schafer was a Boston-based managing director serving clients in the local tech sector and the private equity, venture capital and hedge fund companies that funded it.

When the successive collapses of SVB and First Republic sent startups and venture capital firms running to diversify where they kept their deposits, Leader found an opportunity to finally get in on the region’s booming tech sector.

“We’ve fallen into it a little bit, more by accident. Especially when the SVB and First Republic stuff happened, a number of of clients came over, referred by our contacts,” Tuli said. “The majority were Massachusetts-based, and a lot of them were smaller VC funds, themselves.”

Leader plans to build on this foundation with a familiar playbook that SVB, First Republic and their local rival Cambridge Trust have successfully used: develop banking and lending products and a knowledge base that startups and venture capital firms need, and start hosting events to connect startup executives to investors, other founders and potential employees.

“What startups need is a lot of connections, and this is where the relationship [with the bank] is really important,” Tuli said. “They need connections to potential investors, perfecting their pitch. They need some hand-holding as they build their business.”

While many startups don’t need debt early in their life cycle, Tuli said the relationships Leader hopes to build with startups can grow from simple depositors as those startups grow over the long term. Leader hopes its relatively small size – $4.02 billion in assets, $3.43 billion in deposits – can help it stand out when compared to the two biggest banks serving the local tech sector: SVB owner First Citizens Bank and JPMorgan Chase, which absorbed First Republic.

“We think there’s an opening here for a smaller and more nimble bank to come in,” Tuli said. “SVB was already big and now they’re part of a much bigger bank. In a way they can serve the much bigger clients better and it makes it harder for them to serve the smaller clients. It’s also about the team members, the employees. They don’t all want to work for such a large organization. The appeal for them was the entrepreneurial nature, the smaller size of the banks they worked for.”

At Leader, Schafer’s title will be “director of venture capital, private equity and technology banking,” and Tuli said the bank is looking to “opportunistically” hire additional staff for Schafer’s team as it finds them. The bank hopes to grow its technology banking unit to $500 million in deposits in the next five years, Tuli said.

While recession worries, the spring’s bank failures and higher interest rates have caused some investors to redirect funds to less risky investments and away from startups, Tuli said that he believes the bank is at an ideal time to get into the tech space and take advantage of any growing thaw in the tech sector’s capital markets.