Mercury

Mercury's oversampling trick: every VC thinks 'everyone' uses it

Julian explains how Mercury became the default startup bank: YC companies send investors beautifully formatted Mercury wire PDFs at Demo Day. VCs see so many Mercury startups that they assume everyone uses it and recommend it to portfolio companies, even though most of the market doesn't.

“And it's also— it has this interesting phenomenon of oversampling. Which I might be using the term wrong, but you'll get the gist, which is these VCs are seeing such a high percentage of startups using Mercury that they're now under the assumption that everyone's using Mercury, right? Or at least it risks that impression, right? Yeah. And so as a result, these VCs, when they're asked by their own portfolio companies, hey, should we use Mercury? They're like, oh yeah, everyone uses it.”

Steal thisTarget a small, high-influence persona (VCs, influencers) until they perceive you as ubiquitous; their bias trickles down to the mainstream.

Club LTV: free gated e-com group monetized via sponsors

Shaan built Club LTV, a no-website community for e-commerce owners doing $100K+/month, in about 8 hours of work. Members join free; he charges sponsors. Mercury Bank pays $5,000/month and converted 5 of the 75 stores, including a $2B company.

“So Mercury Bank is the sponsor of it because that's who I would use for e-commerce projects, and they have a big push in e-commerce. And so they've had at least from our group, 5 different, 5 out of the 75 e-commerce stores switched to Mercury just from the sponsorship. So they've gotten their money's worth out of it, including one company that's a $2 billion company has switched over to them.”

Steal thisMake the community free for high-value members, then sell sponsor access to that vetted honeypot audience.

Mercury took 18 months and 8 people to get good

Immad started Mercury in August 2017, got its first alpha user in January 2019, and considers the April 2019 launch the point it was good, about a year and a half in, with 8 people total: 6 engineers, 1 designer, and 1 product/BD person.

“So we started in August 2017, and the first alpha user was January 2019. So a year and 3 months before we had any alpha users, and even then it was pretty crappy. I would say when we launched in April 2019, which was basically a year and a half from start, that was when it was good. For most of that time, we had 8 people working on it, including me, 6 engineers, 1 designer, and 1 kind of product BD person.”

Banks treat depositors as a cost center, not a customer to win

Immad explains why challenger banks exist: traditional banks make money on lending, so they view depositors purely as a cost (branches, signups, support) rather than potential. That blind spot is exactly what lets Chime, Mercury and others win.

“the reason like all of these challenger banks exist is because banks don't care about deposit customers. Like, that's like the fundamental issue in banking where like they think of depositors as like like cost center, because it costs them a lot of money to like have someone walk into a branch, like sign up for a bank, and then like worry about all this stuff. Where they make money is lending.”