Just incorporated Delaware C-corp. Need business checking account. Seeing lots of founders recommend Mercury. Anyone have experience with them vs traditional banks like Chase or BofA? Pros/cons?
Mercury pros: Online application (approved in 2 days), great UI, free ACH/wires, integrates with accounting software, no minimum balance, virtual cards.
Cons: No physical branches (can't deposit cash), FDIC insurance through partner banks, some vendors want "real" bank for large contracts.
I use Chase. Reasons: needed a business credit card for travel rewards, wanted relationship for future credit line, have branch near me for occasional cash deposits. Monthly fee is $15 but waived with $2K balance.
Best of both worlds: Mercury for ops (payroll, vendor payments, daily stuff) and a traditional bank account for one-off needs. I keep $5K in Chase for when I need branch services. Mercury is primary.
If you're raising VC: many investors wire to SVB/First Republic type banks. After SVB collapse, Mercury and Brex picked up a lot of startup banking. Investors don't care which bank you use, just that you can receive wires.
Anyone tried Relay? Similar to Mercury but I heard their customer support is better. Just switched from Chase and the no-fee thing is nice when you're pre-revenue.
The separate "buckets" feature for different expenses has been really helpful for keeping track of payroll vs operating expenses.
Word of warning on fintechs - my Mercury account got frozen for 3 weeks last year during a "routine review." No warning, no explanation, couldnt access my own money. It worked out eventually but it was terrifying.
@BothHaver's advice about keeping a traditional bank as backup is smart. Don't put all your eggs in one basket, especially with newer financial institutions.
Late to this thread but wanted to add - if you're doing international payments, Mercury and Wise integrate really well together. I pay contractors in 5 different countries and the fees are way lower than traditional wire transfers.
Also make sure you have solid contractor agreements in place before sending money overseas - there's a good template here that covers international considerations.
Late to this thread but wanted to add a financial ops perspective since I handle banking for three startups. The bank account decision matters more than most founders realize because switching later is a massive headache involving updating payroll, vendor payments, customer billing, and tax filings.
Mercury has gotten significantly better since this thread started. They now offer Treasury accounts with up to 5M in FDIC coverage through their sweep network, which addresses the FDIC concern several people raised. They also launched IO cards with higher limits for funded startups. The API is genuinely excellent if you need programmatic access to banking data for reconciliation or reporting.
One thing nobody mentioned yet: consider your accounting stack when choosing a bank. Mercury and Relay both have native integrations with QuickBooks Online and Xero that automatically categorize transactions. This saves hours of bookkeeping each month. Chase and BofA integrations exist but are clunkier and sometimes disconnect, requiring manual reconnection.
My current recommendation for pre-seed to Series A startups: Mercury as primary operating account, a Chase business checking as backup (their Sapphire Reserve card relationship alone justifies this), and a high-yield savings or money market account at a separate institution for your runway reserve. Keep at least 3 months of operating expenses in the backup account at all times. After what happened with SVB, diversification across banking relationships is not optional anymore.