Mercury, a start-up that provides banking services to other start-ups, is offering up to $3 million in enhanced FDIC insurance to customers through a new product following the failure of Silicon Valley Bank. This is 12 times the industry standard for his FDIC insurance of $250,000 offered by other financial institutions.
Mercury CEO and co-founder Immad Akhund told TechCrunch that his team spent the weekend working on a new product called Mercury Vault.
Existing and new clients with more than $3 million in accounts will be asked to transfer funds to Mercury Treasury’s Vanguard Money Market Funds. The fund is 99.5% invested in securities backed by the U.S. government (mainly a mutual fund consisting of his T-bill). 100% retained in the customer’s name. As the company continues to develop its products, customers have the option of automating that money movement.
“If you want $2 million in a management account, make sure you have $2 million in there. ,” Akhund said.
To be clear, Mercury itself is not a bank. Through our partnerships with Choice Financial and Evolve Bank & Trust, we are able to offer our clients access to a “sweep network” of other banks such as Goldman Sachs and Capital One.
Akhund said Vault not only gives customers access to enhanced FDIC insurance of up to $3 million, but also spreads their deposits across up to 12 different banks to spread risk and ease anxiety.
Vault will also “continuously monitor cash across accounts and recommend actions to keep every dollar as safe as possible,” Akhund said.
“Until Thursday, I don’t think a lot of people really thought about who had the money and whether it was safe,” he said.
In general, he said, Mercury has had “massive signups” since the news of SVB’s predicament became public. While its clients are primarily startups, Akhund said the company also serves investors and has seen inbound interest over the weekend from VCs looking to move money.
on Mercury It says it has over 100,000 customers and has been profitable since August last year. The company has processed more than $50 billion in deals in 2022, up from $23 billion in 2021. According to the company, 50% of him in the YC cohort “choose Mercury as their banking partner.”
Since its inception, Mercury has raised $163 million from investors including Andreessen Horowitz (a16z), CRV and Kochu.that last round $120 million Series B Announced in July 2021.
