Mercury CEO, Immad Akhund Says AI Is Overhyped and Overvalued

Immad Akhund has backed over 350 startups since 2016, but he insists he didn’t start investing until he could afford to lose money. “This is a rich person’s game, sadly,” the Mercury CEO said on Harry Stebbings’ podcast earlier this week. “Doing one or two angel investments won’t make a difference, you need to do at least 20 or 30 to learn, iterate, and have any real return.”

Now, nearly a decade into angel investing, with hits like Rippling, Truebill, and Airtable under his belt, Akhund is turning a deeply personal investing practice into a more structured vehicle. His new $26 million fund, quietly closed in three weeks, will back around 60 early-stage startups with average checks of $150,000. “I’ve always loved helping founders—this just lets me do it more meaningfully,” he said.

1/ Excited to share I’ve raised a $26M venture fund to back early-stage founders.@Mercury is still my 100% focus but I’m formalizing my angel investing in this fund.🧵 https://t.co/yls6cLs4vF

— immad (@immad) May 12, 2025

Though Mercury remains his main focus, Akhund sees investing as symbiotic, not distracting. “From the first 30 alpha customers of Mercury, 100% were companies I had invested in,” he noted. “My investing has helped Mercury, and Mercury helps my investing.”

Partnering with longtime collaborator Yash Doshi, who backed Mercury early while at EQT Ventures, Akhund aims to bring the same founder-first approach that shaped his angel career into institutional VC. “We’re not leading rounds. I’m an active CEO. I can’t do that responsibly,” he said. “But the best founders want me on their cap table.”

Immad Akhund has quietly become one of the most prolific angel investors in Silicon Valley backing more than 350 companies over the past nine years while scaling Mercury into one of the most widely used business banking platforms. Now, he’s institutionalizing his investing activity with a $26 million fund, co-managed with longtime collaborator Yash Doshi.

“I’ve always loved helping founders, this just lets me do it more meaningfully,” Akhund said on Harry Stebbings’ podcast on May 12. “It also allows me to operationalize this work.”

4/

I want to back founders with:
* an exceptional track record of building
* going after massive $10B+ markets
* pursuing things that need to exist for humanity.

— immad (@immad) May 12, 2025

Raised in just three weeks, the fund is designed for breadth, not control. It will target around 60 early-stage startups with average checks of $150,000, reserving the option for larger “conviction checks” of up to $1 million. About 60% of the LP base consists of fund-of-funds, with the rest coming from entrepreneurs and fellow GPs. The largest single check was $7.5 million.

From Solo Angel to Structured Investing

Akhund started angel investing after selling his previous startup in 2016. “I think this is something that entrepreneurs, especially active ones, struggle with at first,” he reflected. “You’re used to having your own ideas, so you start out by saying: ‘Hey, here’s a better idea than yours.’ But that’s not fair. You’re not supposed to impose your vision on founders—you’re along for their journey.”

He admits early mistakes. “I used to think I had to be super hands-on. But my best investments didn’t even talk to me again,” he said, pointing to Rappi as an example. “They were just too busy building and that’s what I want. A big return without interference.”

Over time, his investing philosophy sharpened: back founders with strong vision, don’t micromanage, and resist the temptation to judge too quickly. “I passed on Scale AI because I thought the founders were too young,” he said. “That was a big miss. Youth can be a strength you have to suspend belief sometimes.”

If there’s one clear bias in Akhund’s portfolio, it’s toward repeat entrepreneurs. “I just prefer serial founders. I have such a bias toward them,” he admitted. “Especially ones with a chip on their shoulder. If they’ve had a unicorn exit and could just retire, I’m less interested. But the ones who still have something to prove? Those are the ones I back.”

That said, Akhund doesn’t dismiss first-time founders—particularly those bringing a fresh perspective to entrenched industries. Reflecting on his own journey, he recalled that when he started Mercury, he had no background in fintech. Yet that outsider lens, he believes, worked to his advantage. He noted that despite his conviction, most fintech investors only saw the risks and passed on the opportunity. Akhund spent his first year deeply immersed in understanding how neobanks function, driven by a clear vision of the product he himself would have wanted to use. In his view, that kind of informed naivety combined with relentless curiosity can be a powerful asset.

Lessons from Truebill, Rippling, and a 30x Return

Akhund’s biggest win to date? Truebill. He invested at a $16 million valuation and exited at over $1.2 billion when Rocket Money acquired the company. “The founders were incredible. It was a hard business, fintech, consumer, brutal user acquisition but they nailed it,” he said. “Also, the timing was perfect. They sold in December 2021 just before the downturn.”

The pattern he sees again and again: repeat founders in difficult spaces often outperform. “I’m also in Rippling. Same story, tough market, but they just own it.”

His advice to angels is don’t dabble. “If you have enough money to do 20 or 30 investments, then do it. If you’re only doing five, you’re not learning, and you’re not going to hit any decacorns.”

Why Mercury and Investing Aren’t in Conflict

For Akhund, investing and running Mercury are deeply intertwined. “From our first 30 alpha customers, 100% were companies I had invested in,” he said. “Investing has helped Mercury. And Mercury helps my investing. I have a strong founder network, I know what early-stage companies need, and I understand fintech inside-out.”

Akhund is candid about the limits of his time. As an active CEO, he makes it clear that he isn’t leading rounds, noting that doing so wouldn’t be responsible. Instead, his role as an investor is designed to be lightweight but accessible. He typically has quick, focused conversations with founders a few times a week and, if anything, wishes more of them would reach out. On the question of whether managing a fund could conflict with running Mercury, he emphasized that the two are complementary. 

He’s been transparent with LPs from the start, stating that Mercury remains his primary focus, and that his investing activity functions as a “sidecar” that strengthens, rather than distracts from, the business. According to Akhund, even his co-founders view it as a core part of what makes Mercury successful.

Despite market hype, Akhund is hesitant about most AI startups. “AI is overhyped and overvalued,” he said. “I’ve seen the same idea five times, with founders raising at $40 million valuations and very little traction. The math is just hard.”

He’s still doing AI deals but only selectively. “Either it’s a repeat founder applying AI to a space they deeply understand, or it’s already a rocket ship with real traction,” he clarified.

Instead, he sees more opportunity in underhyped sectors like fintech and space tech. “I’ve done a few in space like Stoke Space, Albedo and I don’t even know that much about it,” he said. “But the markets are real, reusable rockets, satellite imaging, communications. It’s not as hard as people think.”

Why He Took 120x Revenue

Akhund isn’t shy about chasing high valuations when the deal makes sense. “We did our Series B at 120x revenue,” he said of Mercury. “It wasn’t rational. This was 2021. But I’d do it again.”

His logic: if you’re going to take a high valuation, raise enough capital—and don’t spend it. “The mistake is raising $50 million at a billion-dollar valuation. You need to raise enough to grow into it,” he explained. “When we raised $120 million, we were a 40-person company. I didn’t even know how we’d spend it. But I wanted to either never raise again, or spend into growth.”

That restraint, he said, is what separates experienced founders from the rest. “Most younger founders will blow the money. And that’s partly on the VCs pushing them to spend.”

On Competition, Moats, and a $100 Billion Bull Case

Akhund is acutely aware of the competition from Ramp, Brex, and others but he’s unfazed. “Every year since 2006, I’ve had a better-funded competitor. It rarely matters,” he said. “We don’t talk about competitors internally. If someone says, ‘We should build this because someone else did,’ I shut it down. Tell me why the customer needs it.”

Instead, he’s playing a long game. “We want to be your first bank account,” he said. “That’s our wedge. Ramp and Brex are great but they’re going after bigger, enterprise customers. We’re there from inception.”

So what’s the bull case for Mercury as a $100 billion company? “Banking in the U.S. is a $2 trillion market. Financial software is another $500 billion. To me, these should be the same market,” he said. “The only reason they’re not is because banks don’t know how to build software.”

Akhund could have continued investing informally, or sold Mercury secondary shares to fund his own deals. So why take on LPs?

“I think it’s fun to build institutions,” he said. “I’m working with Yash. We might incubate ideas down the line. Maybe we’ll do 150 investments in the next fund. It’s open-ended.”

Still, he’s measured. “This is the first fund. I’m not saying we’ll raise $200 million next. But I’m interested in where it could go.”

He knows the risks of being pulled in too many directions. “As long as it works for Mercury, and the founders I back, it’s worth doing. So far, it does.”