Mercury, a fintech that provides financial services to businesses, has raised $300 million in a Series C round; its valuation doubled to $3.5 billion. Sequoia Capital was the lead investor in the round, alongside new investors Spark Capital and Marathon and returning investors Coatue, CRV and Andreessen Horowitz.
The infusion of cash appears to be a reflection of the company's growth and profitability, as well as what some observers see as a resurgence in investor confidence in fintechs.
"It's impressive to see a fintech raise $300 million and nearly double its valuation — especially in the current funding environment," said Paul Davis, founder of Bank Slate, a consulting firm that focuses on banking and fintech. "Mercury's success in this round, which included a mix of returning and new investors, reflects its ability to maintain momentum after it benefited from the collapse of Silicon Valley Bank. Since then, the company has broadened its offerings — most recently adding a personal banking service. I believe the most successful fintechs will be those that evolve beyond being monoline providers, and Mercury appears to be doing just that."
Jim Perry, senior strategist at Market Insights, said he was struck by the fact that Sequoia Capital was the lead investor.
"Sequoia has often invested in companies with the potential to disrupt industries, and they clearly see Mercury as a disrupter to legacy banks," Perry said. "I also imagine Mercury's growth, especially post-Silicon Valley Bank's collapse, and their consistent profitability did a lot to inspire confidence among investors."
Mercury, which was founded in 2018, now has 200,000 business customers, including tech startups and e-commerce businesses. It offers corporate credit cards and financial software to help businesses pay bills, send invoices, automate accounting and manage employee expenses.
According to the company, Mercury has had ten consecutive quarters of profitability. It generated $500 million in revenue last year and its customer base grew 40% in 2024.
"Mercury began with the vision that banking should do more than safely hold money — it should bring all the ways people and businesses use money into a single product that feels extraordinary to use," CEO Immad Akhund said in a statement.
Asked how the company plans to deploy the $300 million, a spokesman said this round isn't about funding Mercury's operations, but about being in a position to take advantage of opportunities.
"We're fortunate to be in a position of strength," he said. "We've increased our profitability and maintained a strong balance sheet. The next phase for Mercury is about continuing to challenge what banking can do and enabling it to do more for our customers while broadening who Mercury is for."
Aman Verjee, general partner at Practical Venture Capital and an early investor in Mercury, said his firm invested in the company shortly after Silicon Valley Bank and First Republic collapsed "because we saw the potential gap in [small- and midsize business] banking," he wrote in a LinkedIn post. "In the aftermath of those failures, Mercury saw an influx of $2 billion in client deposits … and according to CEO Immad Akhund they have retained 95% of those deposits."
Mercury offers business banking services through Choice Financial Group, Column Bank and Evolve Bank & Trust. Its corporate credit card is issued by Patriot Bank. It also provides personal banking services through Choice Financial Group.
Mercury is currently unwinding its long-standing relationship with Evolve Bank. Mercury has said it simply outgrew its original partnership with Evolve and Synapse, a banking-as-a-service middleware provider that provided a ledger that banks and fintechs could share. Mercury was Synapse's largest customer, but it stopped onboarding customers to the Synapse-Evolve relationship in 2022 and switched existing customers to a direct relationship with Evolve. Last April, Synapse filed for bankruptcy, and a $65 to $95 million shortfall in customer funds became apparent that has yet to be fully resolved.
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Whether Mercury's capital raise signals a broader fintech resurgence is still unclear, Davis said.
"As always, the winners will be companies with a clear story, a path to profitable growth and a reasonable exit timeline that appeals to investors," he said.
Perry said he's heard people talk about a fintech spring, but is still on the fence about it.
"Mercury's news suggests that is right," he said. "But much like late March in the upper Midwest, where our first steps into springtime are often tentative, I think we need to see more news like this before we can declare that fintech spring has arrived."
