The 10 Best Banks for Funded Startups

How to choose the right bank for your startup in 2024

VC backed startups have specialized banking needs that can not be met by traditional small-business focused banks. Founders that have raised professional funding need to look for the best banks for startups, financial institutions that provide good customer service, solid technical integrations, offer startup-focused advice and products - all while being financially stable.

In early 2024, the banking world has thankfully stabilized. Right now, JP Morgan Chase leads our startup clients in marketshare, followed by SVB (back in business!) and Mercury. Other players we list below have good offerings and are good fits for some VC-backed startups as well. 

From the turmoil of startup banking in 2023 to what’s new in 2024

The early-stage finance world changed in the first part of 2023, with the failure of Silicon Valley Bank, FRB and several other startup-focused banks. Where founders kept their businesses’ money suddenly mattered, and our team must have fielded over 100 calls from panicked founders worried about their companies’ checking accounts.


How to choose the right bank for your startup

As a founder, you want to make sure your funds are safe and accessible. Some of the qualities we recommend looking for in a financial institution include:

  • Safe and well-capitalized
  • Strong online banking with solid user interface
  • Good customer service 
  • Low to no fee banking
  • Understands startup finances and the tech market
  • Integration with popular business software like QuickBooks
  • Protection for your operating funds, such as insured sweep accounts that extend FDIC insurance
  • Cash management investment products, like access to short-term government mutual funds
  • Full range of tech focused products like startup specific credit cards, venture debt, and a VC relationship team 

Best Banks for Startups

Here’s our breakdown of many of the institutions we regularly work with. Some of these are not technically banks, but have an underlying relationship with a bank. We encourage you to perform your own diligence on any financial institution before you establish a relationship.

Financial Institution Online interface Branch offices Customer service QBO integration Loans or lines of credit Extended FDIC protection Cash management services/products
Arc Good No Phone, Email Yes Yes Yes Yes
Bank of America Fair Yes Phone, Email  Yes Yes Yes Yes
Brex Good No Email, Live Chat Yes Yes Yes Yes
Bridge Bank Good Yes Phone, Email, Dedicated Banker Yes Yes Yes Yes
California Bank of Commerce Good Yes Phone,

Email
Yes Yes Yes Yes
Citizens Bank Good Yes Phone Yes Yes Yes Yes
FRB / JP Morgan Chase Good Yes Phone,

Email,

Online
Yes Yes Not sure Yes
JP Morgan Chase Fair Yes Phone,

Email,

Online
Yes Yes Yes Yes
Meow Great No Live Chat Yes Yes Yes Yes
Mercury Great No Email, Online Yes Yes Yes Yes
Rho Great No Email, Online Yes Not sure Yes Yes
SVB / First Citizens Great Yes Phone,

Email
Yes Yes Not sure Yes
Treasure Financial Good No Email,

Live Chat
Yes Not sure Yes Yes

When should a founder open a bank account for their startup?

Every startup founder has to make a decision early in the company’s existence – when to open a business bank account. You really need to do this as you are getting funded - you should not wire investor money for your startup into a personal bank account. And going forward, after you are funded, you need to make sure that all company expenses flow through the business accounts, and that you do not put any personal expenses through the business. Kruze’s founder, Vanessa Kruze, CPA, breaks when to open a bank account for your startup:

At what point should you create a company bank account and start with quickbooks/accountant for your startup?

More detailed question from a founder:

“Using personal savings and CCs to pay for services now. Will Inc. (c corp) soon but don’t plan to monetize right away,or only get a little $ in early on. At what point should I create a company account and put some of my savings in, start using QuickBooks, talk to an accountant? Right after I inc.?”

Vanessa’s response:

Incorporate as soon as you start spending a material amount of money on the idea, begin signing legal agreements and before you start hiring contractors or employees. Get yourself protected legally.

If you are going to raise real Angel and VC capital, then incorporate as a Delaware C Corp. VCs can’t invest in LLCs and S Corps, so if you go that direction you will need to reincorporate later. Btw - LLC and S corp structures are great if it’s a family owned business and you will not be raising VC capital. In fact we are an S Corp. :)

Once incorporated, you can get a separate bank account. Do that immediately. You want to clearly document all spend on the new business. Go back and document the spend before you were incorporated so you can get reimbursed later or roll it into equity. And make sure you get a bank that knows startups, not some random regional bank or mega-bank. (Read our tips on how to read a bank statement.) Very few banks understand VC backed businesses. This matters for a few reasons. 1, most small business focused banks don’t “get” the fact that tech startups burn cash; they are used to small design firms or coffee shops where the cash balance goes up every month. You don’t want them putting you on some internal ‘watch list’ because they think you are going out of business. 2, the right bankers are very connected into venture capitalists, and can make introductions to potential investors. These are often high quality intros.

When you have the bank account, use only that account for the business. Do not mix personal and business anymore. Founder to Business payments are something the IRS focuses on in an audit. So do it right.

When you’ve raised some money, you then have the ability to get a real startup corporate card. Look for a card that does not put personal liability onto the founders - you don’t want to get stuck with a $250,000 bill from Amex if your startup goes under. Also look for cards that “get” startups - ones that know how to extend a line of credit to a startup based on the amount of money you’ve raised or have in the bank. We are currently recommending Brex as the best credit card for startups. It also makes it very, very easy to manage your spend by category and classification - something that starts to matter as you bring on sophisticated investors.

Once all the spend is segregated, you can wait a bit before doing Quickbooks. Most people can gauge their spending pretty well by looking at their bank account. However, if you want more granularity and/or you have investors, then use Quickbooks. This is probably the time to hire a startup accountant like us.

We encourage companies to raise about a quarter of a million in pre-seed, seed or venture funding before working with us because anything less in capital means you are on a really tight budget and that capital could be better used for achieving product market fit. This is a judgement call for the founder. Some people like professional books earlier, which is fine. Just make sure you don’t waste money on accounting when you could be building traction. We can always go back and clean up compliance and accounting, but you don’t always get a second chance at traction. :)

How many banks should a startup use?

Most VC-backed startups we work with now have two banks – after the SVB crisis, the median number of banks our clients work with went to two from one, and we are seeing VC term sheets that request that the startup uses two accounts. 

This is a pretty big change from what we saw prior to the startup banking crisis - founders used to pick a bank, and then basically forget about it until they were big enough to need a treasury function to manage the millions and millions of VC dollars they had raised.

Why have multiple banks?

Multiple banks let startups have a backup in case their first bank gets into difficulty. Having a second bank, already set up, means that it’s much easier to wire money out quickly. One of the major issues we saw founders have during the SVB crisis was that they were unable to open a second bank account fast enough to get money out of SVB before the FDIC took it over and froze their funds. 

Secondly, having an additional bank means that a startup can get double the FDIC coverage limit of $250,000. In a perfect world, it’s not a bad idea to park at least one month of payroll in a second financial institution, so that if there is another financial crisis you’ve got enough cash to pay your employees for the coming month.

Third, many of the supposedly (and hopefully) safest banks like JP Morgan or Wells Fargo don’t have the best banking interface or infrastructure for startups. So having an operating account with a more nimble bank, and then a safety account with a bulge bracket/”too big to fail” bank makes a lot of sense. Basically, one bank is picked because it has a solid product, feature set and UX, and the other is there for safety.

Of course, startups with only a little cash may not have enough to effectively have two financial institutions. 

Why have multiple accounts?

As the startup grows, one bank account is rarely enough. Separating funds across multiple business accounts can help founders understand the company’s finances more easily, and help them make better decisions. Important reasons for having multiple accounts include:

  • Operational segmentation. Keeping funds in different accounts makes it easy to grasp a business’s financial status. You can tell if you have enough money to cover payroll, or keep sales taxes that you’ve collected separate from your operating funds. This kind of clarity is important when you’re calculating the amount of runway you have or deciding when to fundraise. 
  • Tax preparation. In addition to having an account for sales tax collection, many startups have an account for income taxes, making it easy to set funds aside to pay quarterly or annual tax bills. 
  • Managing expenses. Having an account dedicated to specific expenses makes it easier to monitor and track spending. Many startups establish credit or debit cards for that reason, which can simplify tracking expenses and often eliminate much of the paperwork involved. 
  • Security. Putting funds in different accounts for different purposes minimizes the risk fraudulent transactions, since no single account has access to all of the company’s funds.

In addition to having multiple accounts, tech startups should consider having multiple banks. As the bank failures in 2023 have illustrated, it’s a good idea to allocate your funds to more than one bank for several reasons:

  • FDIC insurance. FDIC insurance only covers $250,000 per depositor, per account type, per bank. Most funded technology startups have significantly higher amounts of cash, so spreading that across multiple banks makes sense. Insured sweep accounts can spread your funds across a network of FDIC-insured banks in increments of $250,000, providing you with more protection, and you access the funds through your primary bank. 
  • Business continuity. In addition to maximizing your FDIC coverage, holding funds in a second institution helps ensure that if your primary bank faces issues, you can access and move funds from another bank. Many startups are establishing operational accounts at smaller banks with better customer service, and placing other funds with large global banks that are highly capitalized and face more stringent regulations, so that they are less likely to face issues that might make a smaller bank fail. 

Income maximization. A startup should keep approximately 12 months of runway in highly liquid accounts, but if your company has more than that much cash on hand, you may want to consider placing the funds in accounts that generate higher yield. Money market funds, which invest in low-risk, short-term securities, are one way that a startup can earn some return on cash.

Creating your banking stack

There’s no hard or fast rules around how many accounts a startup should have, but there are some general guidelines you can follow. As your company grows, you’ll need more bank accounts. And startups in different industries need different types of accounts. While almost every company needs a payroll account, for example, not every company may need a merchant services account. With that in mind, we’ve created a tool to give you an idea of what bank accounts your startup may need.  

Tech startup bank market share

Banking Market Share - Deposit Market Share


Banking Market Share - Deposit Market Share

Which banks are VC-backed startups using now? After the SVB collapse and rescue, the landscape shifted. Founders opened new bank accounts at large, safe players like JP Morgan, and also moved money into fintech solutions like Brex and Mercury. The other biggest banks like Wells Fargo, BofA and Citi should have taken significant market share, but they didn’t. We believe this is because they had a difficult onboarding process, and founders found it very hard to open a new account. 

Newer players like HSBC and others have poached experienced tech bankers from SVB and FRB, and we expect them to come out with products and solutions that will be great for founders. However, one critical item that we’ve noticed as we’ve interacted with these players is that they have a legacy technology stack that will make it challenging for founders (and their accountants) to do business with them. In particular, they need to have accounts that allow for easy - and safe - remote access with correctly provisioned account settings. 

Most startups now have more than one bank account - our median client has 2 banks, up from just one in February of 2023. This has also driven down the average bank account balance quite a bit - by just over half. Of course, this makes sense, as founders now have multiple banks in which to keep their hard earned VC dollars!

Tech startup bank market share

Startup bank market share kruze accounts

Which banks are VC-backed startups using now? After the SVB collapse and rescue, the landscape shifted. Founders opened new bank accounts at large, safe players like JP Morgan, and also moved money into fintech solutions like Brex and Mercury. The other biggest banks like Wells Fargo, BofA and Citi should have taken significant market share, but they didn’t. We believe this is because they had a difficult onboarding process, and founders found it very hard to open a new account.

Newer players like HSBC and others have poached experienced tech bankers from SVB and FRB, and we expect them to come out with products and solutions that will be great for founders. However, one critical item that we’ve noticed as we’ve interacted with these players is that they have a legacy technology stack that will make it challenging for founders (and their accountants) to do business with them. In particular, they need to have accounts that allow for easy - and safe - remote access with correctly provisioned account settings.

Most startups now have more than one bank account - our median client has 2 banks, up from just one in February of 2023. This has also driven down the average bank account balance quite a bit - by just over half. Of course, this makes sense, as founders now have multiple banks in which to keep their hard earned VC dollars!

How many bank accounts do you need?

As your startup grows, you’ll need additional bank accounts to more effectively manage your funds. This tool can help give you an idea of the number of accounts you may need based on the amount of funding your startup has, and the industry you’re in.

Step 1. Select industry

Step 2. Select amount of cash in bank

  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Investment account(s)
  • Operations checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Investment account(s)
  • Operations checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Marketing account
  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Investment account(s)
  • Operations checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Investment account(s)
  • Operations checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Marketing account
  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Marketing account
  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Acounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Investment account(s)
  • Operations checking account
  • Acounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Marketing account
  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Marketing account
  • Business checking account
  • Business checking account
  • Second bank account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Business checking account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Investment account(s)
  • Operations checking account
  • Accounts payable account
  • Accounts receivable account
  • Sales tax account
  • Second bank account
  • Credit card account
  • Cash management account
  • Investment account(s)
  • Payroll checking account
  • Income tax account
  • Merchant services account
  • Marketing account

What bank accounts do you need?

There are a number of different factors that you need to consider when you’re building your banking stack, including your runway, your burn rate, the flexibility you need from your bank, the safety of your funds, the type of accounts you need to serve your customers, and much more. But the biggest variable to consider is how much cash you have on hand. 

The larger your cash reserve, the more complex your banking stack needs to be to help you manage your funds. Let’s look at some of the adjustments you’ll need to make as you grow. Remember, every startup is different, so your company may have different needs than others of the same size. These are just general guidelines – you should discuss your specific requirements with your accountant(s) and your bank representative.

$250,000 or under. Very lightly funded startups can probably just have one business checking account. Capital preservation shouldn’t be an issue, since FDIC insurance will cover up to $250,000. Plus, at this stage, founders are pretty busy – they don’t need the hassle of managing multiple accounts. 

$250,000-$1 million. At this point, you will probably need two accounts, a business checking account for operational expenses and a second account to hold additional funds you don’t immediately need. You should consider setting up your second account at a different bank, which offers you greater FDIC protection and protects you if there are issues with your primary bank. Many founders choose to have an operational account at a smaller, more customer service-oriented institution, and place the remainder of their funds in a larger, well-capitalized bank. At this point, it makes sense to use a bank that offers networked deposit services, which spread deposits among several FDIC-insured banks but allow you to manage your funds from your primary bank. And you should always make sure you can transfer funds between institutions easily and inexpensively.

$1 million-$10 million. This level of funding is significant, and startups should definitely add more options to their banking stack. A credit card account helps you manage and administer your expenses, and eliminate cumbersome expense management processes. You should also consider a cash management program for funds that exceed the amount you need for the next 12 months. A cash management program goes beyond a basic savings account, and provides options for investing your funds in low-risk options, while earning some yield on your cash. Interest rates are trending upward now, and are close to 5% annually. At that rate of interest, if you’ve got $5,000,000 in extra funds that you don’t need for 12 months, you could earn $250,000 over the course of a year. While safety of your principal is your primary goal, you could consider investing in low-risk Treasury bills or government money market funds. The financial institution you choose can help you evaluate your options.

$20-$30 million. At this funding level, your startup probably has a significant number of employees, which means you may need to create a payroll account. A dedicated payroll account helps you ensure your payroll obligations are fully funded, so there aren’t any issues with paychecks. An income tax account allows you to set aside funds for quarterly and annual tax bills, to make sure the money is available when it’s time to pay the government. If you’re accepting credit card payments, you may need a merchant services account to help you process customer credit card transactions. 

$30-$40 million. You’re probably conducting a significant amount of business at this point, even if you haven’t yet reached profitability. Other accounts you may need include accounts receivable and accounts payable accounts. A separate account for receivables helps you see which of your customers have paid their invoices and determine what invoices are outstanding. An account for accounts payable helps you set aside funds to settle invoices that you receive from vendors and contractors. Startups that are doing significant sales should consider a sales tax account, where you can place the sales taxes you’ve collected until you remit them to the proper taxing authorities. That helps make sure you’re not mingling them with other funds.  

$40-$50 million. It’s likely that you have significant cash reserves at this point, and you should make sure that those funds are invested across a range of low-risk options, both to generate some yield and to protect those funds in the event of a banking issue. You will definitely want to take advantage of professional cash management, and you should set up an investment policy statement that’s approved by your board of directors. The IPS provides direction for your investment managers, and reassures your investors that you are managing your funds prudently.

$50 million+. You’ve reached the point where you probably need to set up separate operating accounts for different business functions, like marketing. By designating specific funding for sales and marketing efforts, you’ll be better positioned to review your return on investment, evaluate the effectiveness of different campaigns, and adjust your strategy as needed.

How are rising interest rates affecting startup banks?

Rising interest rates can affect startup bank deposits. Startups that have money in a bank account might earn more interest on your deposits.

This is because banks generally pay higher interest rates on deposits when interest rates rise. However, if startups are pulling out their cash to move it to types of investments that offer higher yields, that reduces the bank’s deposit base. Furthermore, if a bank is locked into longer term assets like mortgages or longer duration T-Bills, the bank could face a liquidity crunch. Those factors, plus the rise in interest rates, could also make borrowing more expensive for banks. 

This is partly what sparked the issue with SVB, and the rest of the banking sector is also challenged because of the same reasons. 

It’s worth noting that the relationship between interest rates and bank deposits can be complex, and there are many other factors that can influence the interest rates that banks pay on deposits and the safety of the deposits.

Ways you can extend your FDIC insurance for more safety

Before the SVB failure, most founders probably didn’t pay much attention to Federal Deposit Insurance Corporation (FDIC) insurance for their company bank accounts. Now founders are paying much more attention to where they’re placing their money and looking for safer ways to manage their cash.

FDIC insurance protects individual bank deposits up to $250,000, which is typically enough for most individuals. However, startups can and do have millions in venture capital, and those amounts far exceed the FDIC limit. Founders and CEOs, as fiduciaries for their companies, need to focus on three tenets of cash management: Safety, liquidity, and managing risk. Safety should always be your primary objective, and recent events have underscored that.

Many banks have developed Insured Cash Sweep (ICS) accounts that will distribute your money to accounts in a network of FDIC-insured banks in increments of $250,000. Your custodial bank will manage the distribution, and provide you with a consolidated report to reduce your administrative burden. Please note that while these types of accounts have been available for over 20 years, they’ve never been tested to see if the FDIC would completely reimburse losses.

Before choosing a financial institution, talk with them about their specific products to make sure those products meet your needs and your cash management policy. Some of our executives have invested in some of the financial institutions we list here, and if you use our links you may get better pricing and we may receive a referral payment.

Financial Institution Amount Insured Product Details
Bank of America $6,000,000 Insured Savings Account Spreads $ across many banks
Bridge Bank $150,000,000 Insured Cash Sweep Spreads $ across many banks
California Bank of Commerce $50,000,000 Demand Deposit Marketplace Spreads $ across many banks
Citizens Bank $130,000,000 Insured Deposit Spreads $ across many Banks
Arc $2,750,000 Arc Gold Spreads $ across many banks
Vesto $5,000,000 Sweep Spreads $ across many banks
Mercury $5,000,000 Mercury Vault Spreads $ across many banks
Rho $75,000,000 Treasury Management Account Spreads $ across many banks
Brex $6,000,000 Brex Business Account Spreads $ across many banks

Other low-risk options to manage bank cash with greater safety

Startups with cash balances that exceed their bank’s insured cash sweep limits, or that would like to further diversify their banking position to reduce risk and improve safety, may want to consider investing in short-term government debt. 

Companies can access short-term government bonds by purchasing them directly from the US Department of the Treasury, or by working with their financial providers to purchase bonds or invest in money market funds. 

Money market funds invest in highly liquid short-term investments like US Treasuries, which are backed by the government. Money market funds, while not FDIC-insured, are considered very low-risk investments and offer startups a high degree of safety for their funds. 

All of the best startup banks have treasury or cash management teams that can allocate client cash into these various products. The very best startup banks also have good to great online interfaces where it’s easy for a founder to manage and understand how their company’s cash is allocated across these various products – although many of the bulge bracket banks like to get on the phone to set up a specialized account.

Financial Institution

Investment Product

Additional Information

JP Morgan Asset Management

Liquidity Funds

Several money market funds focused on stability and liquidity

Bank of America

Merrill Lynch Bank Deposit Program

Offered through Merrill Lynch

Brex

Money market funds

Offered through BNY Mellon

Mercury

Mercury Vault

Offered through Vanguard

Rho

Prime Treasury Account

Managed by RBB Treasury, LLC

Meow

US Treasury Bills

Offered through BNY Mellon Pershing

Vesto Money market funds or T-Bills

Custodied at BNY Mellon Pershing

Treasure Financial

Treasure Managed Income

Actively managed money market fund

Arc

Money market funds or T-Bills

Offered through BNY Mellon Pershing

Why Do Banks Require Deposits From Startups?

As part of a loan agreement, many banks that lend to startups require the startups to keep a specified percentage of the loan in an account at the lending bank. There are two basic reasons banks require startups that borrow money from them to keep deposits in that bank:

  • Risk mitigation. If the funds are held with the lending bank, that bank can monitor how the cash is used, or even take the cash if the startup is doing poorly. It’s called the right of offset
  • Making loans. Banks use funds on deposit with them to make other loans. 

Deposit requirements are a standard part of loan agreements. While you can potentially negotiate the percentage of funds the bank requires for the deposit, you will need to keep funds in your lending bank.

Keeping Payroll at an “Escape Hatch” Bank

An “escape hatch” bank is a bank where startups are now keeping at least one payroll’s worth of cash. It’s separate from their primary bank, and it has a funded account that can be used in an emergency – and where funds can quickly be wired if needed.

This is a safeguard that comes as a direct response to the Silicon Valley Bank crisis which, as we know, really shook up a lot of companies. Now, as a precaution in case of another crash at a bank like SVB, startups are keeping at least one payroll run at a secondary or “escape hatch” bank.

Missing payroll would be a serious problem for any business

The SVB crisis is still fresh for everybody, and one of the worst things that came out of the crash was how payroll was almost missed for thousands of companies. If the government hadn’t stepped in the day they did payroll would have been totally missed. This would have led to an HR crisis involving penalties, lawsuits, and a lot of damage to companies.

It was a close call and everyone has learned from that situation. So now we are seeing, and recommending, that startups have a secondary or backup bank, where they keep at least one payroll’s worth of money. Preferably more than one payroll.

This should ideally be with a bank that’s “too big to fail,” such as JP Morgan, Bank of America, or Wells Fargo. Doing this means that if something were to happen at their main bank, the startup has the “escape hatch” bank account to fall back on. They will have reserves to run at least one payroll and it will give them a couple of weeks to navigate the crash.

We explain who some of the best banks for startups are here. At this moment, the median startup that we work with has two banking relationships, one that they operate out of and another where a small amount of cash is stored. 

One payroll is good, but more is better

For practical reasons, companies are actually keeping a lot more than just one payroll’s worth of money in the “escape hatch” bank. They are also buying US Treasuries directly as well as money market funds, and they’re using money market accounts that have high interest rates to ensure as much of a safety net as possible. 

However, the bottom line is, you simply never want to miss a payroll. It triggers a number of HR problems and financial penalties. So, at the very least, we suggest having an escape hatch bank that you can switch your payroll provider to should there be another crisis like SVB. The average Kruze client now has two banks and we are totally behind this as a logical safety precaution.

VC Funds Are Including Treasury Clauses in Term Sheets

Venture capital term sheets are issued by VC funds to outline the key conditions and terms that a startup will need to accept to get funding. One clause that is getting inserted into more term sheets now is a requirement for the startup to adopt treasury or cash management policies. This can range from a requirement to use more than one bank to having a board-ratified investment policy statement. The bank failures in 2023 have forced both startups and VCs to establish more stringent cash management rules, to protect the VC’s investment.

Startup Bank Reviews

We’ve had clients work with all of the banks we mention on this page, and feel confident that we can review them from the perspective of the value that the startup gets out of it, the UX the founder and accountants experience and how easy the solution is to use from an accounting perspective. Remember, if you sign up through our links you may get a special deal that we’ve negotiated, and we may receive compensation from the solution provider. Our execs have also invested in many public and private financial companies, including many on this page.

Bridge Bank Review

by
Scott Orn Kruze Consulting COO

Scott Orn

Kruze Consulting COO

Bridge Bank is one of the leaders in startup banking, and now they’ve launched a new program designed to introduce startups to Bridge Bank. As background, Bridge Bank was founded in 2001 and has $50 billion in assets. The bank is part of Western Alliance Banking and they are very strong venture lenders. At Kruze Consulting they are a go-to when a client is looking for venture debt, but they do much more than just lending.

The new product is called Bridge to Growth, and is aimed at early stage startups. For bank clients in the startup phase, Bridge to Growth provides an extensive suite of banking services for free. The bank is eager for startups to try their services and get to know the business, and this program makes it easier. There are no monthly maintenance fees, and many checking and deposit fees are free up to certain limits.

HIGH YIELD MONEY MARKET ACCOUNTS FOR STARTUPS

A great new feature offered by Bridge Bank to VC-backed startups with over $1 million in their banking accounts is a high yield money market account. There is also a $1,000 sign up bonus available to startups who choose this bank and keep a minimum account balance for long enough of a period of time (at the moment, the required balance is $250,000 for 3 months). 

SINGLE POINT OF CONTACT FOR STARTUP BANKING

Another differentiator that Bridge Bank offers is a single point of contact. Often, banks will assign clients to an account manager, and then there are specialists who handle things like lending or foreign exchange. Frequently your business will get handed to another group that doesn’t care about the relationship as much. At Bridge Bank account managers work with your company across all departments and serve as a single point of contact for you. In addition to providing responsive service, your relationship manager will advocate for you, for example, making sure that you get best loan rates.

In addition, Bridge Bank is located in many of the major startup locations across the US. In fact, over the last eight years or so the bank has been recruiting bankers who know the startup landscape in specific geographies like Denver, Seattle, Chicago, Austin, Miami, Boston, and others. And now they’ve got people in those areas who really know the market and understand the unique needs of startups. That’s a significant benefit, having someone inside the bank who can represent your interests.

Interview with a tech banking leader

People ask us all the time how we differentiate amongst others in our space, and how we manage our relationships to me is the number one way we are different. We have a single point of contact for our clients in each of those geographies. So, when you come to Bridge Bank as a Series A company, you’re going to be working with that same team throughout the entirety of your relationship with the bank. And that person is in your geography, in your time zone, and is hopefully someone and ideally someone that you use for things beyond questions about banking. We want you to ask us when you want introductions to VCs or, of course, temps, CFO, and accounting firms, and attorneys and use our network to help you. We want to have this be a relationship, not just a banking transaction. And we do that by ensuring that people have their relationships with the individuals at the bank, not just with the bank, and that’s that continuity in the relationship management in region, which in our opinion sets us apart.

Mike Lederman, Senior Managing Director - Bridge Bank

Listen to the entire interview with Mike here.

Mercury Bank Review

by
Scott Orn Kruze Consulting COO

Scott Orn

Kruze Consulting COO

Mercury is a newer player offering startups a great UX and range of products. While isn’t not technically a bank (it offers banking services through a couple of FDIC insured partners, Choice Financial Group and Evolve Bank & Trust it’s getting a lot of market share, which is really exciting. We’re seeing a lot of Mercury customers come over at Kruze.

And the big reason why startup bookkeepers like it is the bank feed is easy to use, it integrates with QuickBooks nicely, and fits with a lot of our proprietary software, so it makes matching those transactions easy.

Early-stage clients like Mercury because they have a lot of great spend management tools. It’s really informative, it helps them know what their cash burn looks like, and it’s got a really great interface. 

Finally, now that yield is possible, founders like how easy it is to select some of the Mercury Treasury offerings and get extra yield on their cash. 

Interview with Mercury Bank Founder

We want them (our startup clients) to do very well. As an entrepreneur, as maybe just as a human, I just want these entrepreneurs to do really well and I want Mercury to be, hopefully, a part of their success, whether it’s just making their life easier, giving them a bank account as soon as they want it all or we can build tools, like APIs, and help them understand their finances. If we can just enable a even 2% improvement in the startup’s life, I would feel great about that.

Immad Akhund, Founder and CEO

Listen to the full banking interview here.

Rho Bank Review

by
Scott Orn Kruze Consulting COO

Scott Orn

Kruze Consulting COO

Rho is a banking app that a lot of startups are using, and it’s built by serial entrepreneurs. These people have built companies before, so they really know what a founder thinks about and worries about and what they need from their bank. The company is based out of New York.

They’ve built a really beautiful interface. It’s just so easy to use and nice to just look at it and navigate around. They also have a really great savings interest rate. So they’re very generous on this. That number changes a lot, but they’re always significantly higher than  other banks. They also have FDIC insurance over all your deposits. This matters for venture backed companies, since they may raise many millions of dollars of funding – and the FDIC typically only insures $250,000. Rho splits your money (this is invisible to you, you only see your total balance) into micro accounts and makes sure everything is insured. 

They are also building basically an accounts payable solution. And that makes it  easy to pay your vendors, to store the invoices, to label the transactions, and make sure they sync into QuickBooks. The invoice aspect of it is really important. We need to be able to check the invoices, to see which months the service from your contractors was provided. Because if we don’t know the months, we can’t do accrual accounting and GAAP based accounting correctly. Rho is really pioneering, like this bill pay aspect inside of the bank.

It’s an easy to use solution, but it’s got some real business applications that can save you time as a founder, and frankly, save your accountant a lot of time.

Podcast Interviews with Startup Bankers by Kruze

Hear from the banks themselves why they are the best option for funded companies

Kruze has interviewed dozens of startup-focused financial services players, from banks to corporate cards to debt providers. Listen to our interviews with top bankers!

Best Startup Banks - Reviewed by Experts

Our clients have over $4 billion dollars in checking, savings and interest bearing accounts with the leading financial institutions serving startups. Our authors are experts at advising early-stage companies on their finances and financial strategies, and are regularly interviewed by leading tech publications for our expertise.

Scott Orn, CFA, is Kruze Consulting’s COO. Formerly he was a VC with Lighthouse, and has had operating roles at a VC-backed startup. As a CFA, he regularly advises Kruze clients on their fintech stack.

Scott Orn leverages his extensive venture capital experience from Lighthouse Capital and Hambrecht & Quist. With a track record of over 100 investments ranging from seed to Series A and beyond in startups, including notable deals with Angie’s List and Impossible Foods, Scott brings invaluable insights into financing strategies for emerging companies. His strategic role in scaling Kruze Consulting across major U.S. startup hubs underscores his expertise in guiding startups through complex financial landscapes.

Healy Jones is a former VC and startup founder/executive. His clients at Kruze have raised over $1 billion in funding, and his team helps startups pick the right financial partners who can support their rapid growth.

Healy Jones blends his venture capital experience with operational knowledge to support startup financial strategies. With a background in investing in over 50 startups and holding executive roles in VC-backed companies, Healy has been featured in major publications like the New York Times, Wall Street Journal, and TechCrunch. His efforts at Kruze have been crucial in helping startups collectively secure over $1 billion in VC funding, showcasing his ability to effectively navigate financial challenges and support startup growth.

Client testimonials

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We're huge fans of Vanessa and the folks at Kruze Consulting. They set up our books, finances, and other operations, and are constantly organized and on top of things. As a startup, you have to focus on your product and customers, and Kruze takes care of everything else (which is a massive sigh of relief). I highly highly highly recommend working with Vanessa and her team.

Vivek Sodera

Vivek Sodera

Co-Founder @ Superhuman

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Prior to Kruze, as a remote-first team, we were weighed down by a lot of the bureaucracy involved with having a distributed workforce. Kruze has supported us above and beyond basic accounting needs by ensuring we have everything we need to expand and support our team wherever they may be located

Zack Fisch

Zack Fisch

Pequity's Head of Operations & Legal

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Avochato has been growing rapidly in the past year – in fact, too quickly for us to keep up with books, taxes, and budgeting for growth. Partnering with Kruze Consulting has been fantastic to manage, track, and analyze our finances while we continue focusing on building our customer base. Kruze’s team knows what startups need.

Alex De Simone

Alex De Simone

CEO @ Avochato

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Everybody, go to Kruze Consulting. They do a great job. I personally can tell you, they've done a great job for our companies, including Calm.com. I'm sure they’ll do a great job for you.

Jason Calacanis

Jason Calacanis

Angel investor

About Us

A CPA Firm Specialized in Startup Accounting & Finance

A CPA Firm Specialized in Startup Accounting & Finance

Startups are our niche, and our passion. Our clients have raised over $15 billion in VC funding. We are one of only a few outsourced accounting firms that specialize in funded early-stage companies - we only offer financial and tax services to fast growing startups in the Pre-Seed, Seed, Series A, Series B and Series C stages.

The Right Accounting Partner for Your Startup’s Next Round

The Right Accounting Partner for Your Startup’s Next Round

We know how to de-risk your startup’s next venture capital round. Our team makes sure you are ready to fly through your next VC’s accounting, HR and tax due diligence. And when you use us as your bookkeeper, we set up and keep up-to-date a due diligence folder so you can get that next round of fundraising.

A Leader in Cloud Accounting Software

A Leader in Cloud Accounting Software

Our practice is built on best of breed cloud accounting software like QuickBooks, Netsuite, Gusto, Rippling, Taxbit, Avalara, Brex, Ramp and Deel. Technology makes us more efficient, saving our clients money and letting us offer higher value services like FP&A modeling, 409A valuation, and treasury advice. Startups deserve to work with CPAs using modern software.

Trusted by Top Venture Investors

Trusted by Top Venture Investors

Top angel investors and VCs refer Kruze because they trust us to give the right advice. Our clients are portfolio companies of top technology and Silicon Valley investors, including Y-Combinator, Kleiner, Sequoia, Khsola, Launch, Techstars and more. With us, your books and taxes are in order when it’s time to raise another round of venture financing.

What types of startups does Kruze Consulting usually work with?

What types of startups does Kruze Consulting usually work with?

Kruze Consulting works with funded Delaware C-Corps. Our clients have secured Pre-Seed to Series C or Series D funding. We look to partner with our clients, going beyond the typical outsourced accounting relationship and seeking to provide a higher level advisory role. We feel honored to be a part of making the world a better place, even if it’s one debit and credit at a time.

Accounting, Finance, Taxes, & Payroll all in one solution

Accounting, Finance, Taxes, & Payroll all in one solution

Startup CFO services, startup accounting and bookkeeping services, startup annual taxes, expense reports, payroll, state sales taxes: we've got you covered. Our software provides custom tailored dashboards that can be provided weekly or monthly, depending on your preference and plan. Founders are often so busy building their company that they don’t have time to take care of their finances. Traditionally, these companies have had to work with a basket of people to get their work done, including bookkeepers, accountants, AP clerks, CFOs, consultants, and tax accountants. At Kruze Consulting, our founders have one point person, saving time and money.

Client testimonials

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We're huge fans of Vanessa and the folks at Kruze Consulting. They set up our books, finances, and other operations, and are constantly organized and on top of things. As a startup, you have to focus on your product and customers, and Kruze takes care of everything else (which is a massive sigh of relief). I highly highly highly recommend working with Vanessa and her team.

Vivek Sodera

Vivek Sodera

Co-Founder @ Superhuman

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Prior to Kruze, as a remote-first team, we were weighed down by a lot of the bureaucracy involved with having a distributed workforce. Kruze has supported us above and beyond basic accounting needs by ensuring we have everything we need to expand and support our team wherever they may be located

Zack Fisch

Zack Fisch

Pequity's Head of Operations & Legal

Quote icon

Avochato has been growing rapidly in the past year – in fact, too quickly for us to keep up with books, taxes, and budgeting for growth. Partnering with Kruze Consulting has been fantastic to manage, track, and analyze our finances while we continue focusing on building our customer base. Kruze’s team knows what startups need.

Alex De Simone

Alex De Simone

CEO @ Avochato

Quote icon

Everybody, go to Kruze Consulting. They do a great job. I personally can tell you, they've done a great job for our companies, including Calm.com. I'm sure they’ll do a great job for you.

Jason Calacanis

Jason Calacanis

Angel investor

READY TO CONNECT FOR A FREE CONSULTATION?

We are the experts at helping seed/VC-backed Delaware C-Corps with their accounting and finances!

Talk to an experienced accountant, not a generic sales person

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Alex Janeck
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Edith Silva
 Kruze Consulting
Ian Williams
Viz AI

$250M+ VC Funding Raised


"I had a great experience working with Kruze Consulting when we raised Series A. They know what VCs need to see, and how to present a startup’s books and finances. If you are going to raise venture capital, you need experts like Kruze."
Chris Mansi

Chris Mansi

CEO

Startup Venture Capital Assistance

With former venture capitalists on staff, our team is here to help you navigate the fundraising process and manage your board of directors

 Kruze Consulting
Scott Orn
COO | Former VC
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Healy Jones
VP FP&A | Former VC
Pequity

Scale Remote Operations & Team


"Kruze has supported us above and beyond basic accounting needs by ensuring we have everything we need to expand and support our team wherever they may be located"
Zack Fisch

Zack Fisch

Head of Operations & Legal

Clients who have worked with Kruze have collectively raised over $15 billion in VC funding.

We set startups up for fundrising success, and know how to work with the top VCs.

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Vanessa Kruze, CPA
Founder & CEO
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Experienced team helping you

Our account management team is staffed by CPAs and accountants who have, on average, 11 years of experience.

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Bill Hollowsky, CPA
VP of Accounting Services
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Claudine Vantomme, CPA
Controller
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Morgan Avery
SUT/R&D Sr. Tax Accountant
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Beth Bassler
Controller, CPA
Protara Therapeutics

Grew from a 2-person startup to a NASDAQ listed public company.


"The Kruze team helped us grow from a 2-person startup to a NASDAQ listed public company in 2 years. We wouldn’t have gotten public without Kruze’s support. Anyone thinking of launching a startup should make Vanessa their first call!"
Jesse Shefferman

Jesse Shefferman

CEO

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