We’re excited to launch Mercury out of private alpha today. Our vision is to deliver a great bank to startups that helps them succeed.
Over the past year and a half that we’ve been building Mercury, I’ve been asked dozens of times what I’m working on, since “what do you do?” is one of the top three most common small talk topics in San Francisco, along with “how about that rain huh?” and “the rent sure is high.”
What surprised me was that the people I talked to were often confused when they found out I was working on a bank for startups. The idea had seemed straightforward to me, but people have a lot of different conceptions of what a bank is to them — a building with a safe, some group of people in dark suits, or just an abstract idea consisting of loans and fees.
Pretty much nobody thought of a bank as a product or as something that could be a tech company.
In our minds, it was very clear what we wanted to build. We think of a bank for startups as a product with three main components:
- User Interface: Startups need to be able to access and do things with the money they have, ideally with some level of efficiency.
We thought about how to make a great UI and came up with things like a three-click send money flow, fully-indexed transactions that are searchable and filterable, and your routing and account number displayed in a logical location. This also extends to having quick, competent customer support and providing great APIs to let you build things on top of your Mercury account.
- Financial Services: Startups usually have raised money or are making money. They should have transparent and responsible ways to make smart decisions with their capital.
To begin with, we’re giving access to savings accounts that earn either 1 or 2% on deposits to everyone that signs up. Down the line, we’ll be providing further ways to maximize how much you make on deposits (“treasury management”) and startup-friendly loans.
- Company Insight: Banks have all the data on what’s happening in your company. Companies should be able to access that data and see their financial health from a central HUD.
Right now, we have basic analytics tools. Our short term roadmap includes expanding these and also integrating across your financial stack (e.g. Stripe, Square, Gusto) so you can visualize what’s happening with your company with one click.
I founded three startups in the 13 years prior to starting Mercury, and the banks I used executed these functions in pretty haphazard fashion. I ended up having to figure out a lot of it myself through a mix of spreadsheets and patched-together processes. I had to call in to send a wire and gather my co-founders at a branch for a couple hours to open an account. Getting a savings account with any interest, if it was possible at all, would usually take extensive back and forth negotiation and result in earning fractions of a percentage point. And I couldn’t rely on the banks to get any clarity into company finances; usually I’d be pulling up spreadsheets or throwing together an ugly admin page.
The last thing I wanted to do as a founder was log in to my old bank or interact with it in any way. We hope to turn that on its head and make logging into your bank the first thing you want to do every morning.
It took a lot of research and help to get to this point. In between meeting more than 100 experts in banking, fin-tech, compliance, and banking law, we also talked to all the people we could find that had started tech banks. There are more than you might suspect! The founders of Square1, Simple, N26, and even Silicon Valley Bank gave us great perspectives on what we needed to do. Roger Smith, the founder of Silicon Valley Bank, also ended up investing in Mercury.
I’d like to give special thanks to Dan Kimerling and Zac Townsend, founders of Standard Treasury (a YC company that sold to SVB), both of whom have extensive knowledge of the industry and were incredibly generous with their knowledge, time and contacts.
Alex Rampell, GP @ Andreessen Horowitz and previously co-founder of Affirm, Point, and TrialPay (now part of Visa), was one of the few investors with an active investment in a bank (Cross River Bank) and was also extremely generous with his time and advice. Andreessen Horowitz eventually led our seed round. It’s great to have Alex and Andreessen Horowitz on our side.
We’ve had a lot of help along the way and of course have to give thanks to our lovely families, supportive friends, and a long roster of investors who’ve trusted us to build the bank they wish they had while doing their startups.