Immad Akhund is co-founder and CEO of Mercury, a new bank for startups that has backing from CRV, A16Z, and many other top tier investors. Previously, he was a part-time partner at Y Combinator, and before that he founded Heyzap, which was acquired by Fyber for $45M.
For this AMA, we're excited to dig in on the tools Immad and his team use at work, what makes Mercury a special product, and what he thinks about all sorts of other SaaS topics.
This AMA took place at 4pm PT on February 11, 2020.
We generally believe that there are better and more customer aligned ways of making money from banking than fees.
We charge no monthly fees and all transactions apart from international wires and domestic (for non tea room customers) wires are free. You can see full pricing on mercury.com/pricing
I am really impressed when big companies can innovate at scale.
The most recent example of that is Tesla's Cybertruck launch. But Apple launching iPhone and Amazon launching AWS were equally impressive feats.
Its really exciting to see someone putting a ton of resources behind doing something new and world changing.
Many challenger banks and fin-tech companies are finally reaching the scale where they can do interesting products that were only available with scale.
This has already led to a large consumer benefit: like no transaction fees for trading stocks and high interest savings accounts. As the impact expands we are going to see benefits across lending and other payment types.
We try to use the most modern tools at Mercury across the stack. These are the most crucial:
Slack, GSuite, Linear.app, Github, VSCode, Figma, Notion
I would weigh the following factors:
A few types of business model have delayed revenue and venture debt (or any sort of debt) can make a lot of sense.
For example if you make a lot of revenue but most of your customers pay you after 90 days then having extra cash flow to cushion that is a no brainer.
For a company thats not making any revenue going down the debt route can lead to contraction of options. If things go south and you can't raise the next funding round then that debt can basically force you to shut down the company. Where as you would have more options available if you didn't have debt to service.
We started Mercury because working with incumbent banks at my last startup was really painful. The products suck, you often have to call people to get things done, they charge you random fees in unexpected way, they don't have APIs and they never improve.
We think there is a lot of room for innovation and the field is more than 10 years behind other software.
I owe a lot to Y Combinator and giving me a path to emigrate from London to San Francisco.
At least in 2007 the silicon valley/SF scene for entrepreneurship was a lot better than in London and its been the biggest accelerant to my career.
iOS app is our most requested feature. We are going to have that live soon!
We are also close to launching virtual debit cards. So you don't have to wait for the physical card to arrive and can make extra cards on the fly. This is especially useful to our foreign-resident users.
We are also half way through building a fairly powerful user permissions system that has been heavily requested and excited to see that develop.
The biggest ongoing shift in business spending is the continued shift to SaaS. Almost everything we spend money on now is SaaS based.
Part of the reason we started Mercury is to help businesses understand where and how they are spending money. SaaS fees can often balloon unexpectedly and we think that your bank should help you monitor whats happening with your money.
Financial services and regulation can seem intimidating initially. I think the key to success is to not be scared and dive in to understanding them deeply.
Often those that are best situated to understand financial services / regulations (like bankers) are so stuck in how things are done in the past that they don't understand what is possible. Bringing a multi-disciplinary mindset to the space actually allows you to really build great products in a way that no one within the industry would do.
We spend 1.5 years building the product and it helped that I knew exactly what my pain points were at previous banks and what we wanted to build.
The growth really kicked off when we launched on Twitter. @a16z, @justinkan, @eladgil and a few others are investors in Mercury and have big twitter followings so their initial tweets were the spark to our growth.
Since then we have grown organically through word of mouth.