May 12, 2025 · 1h 4m · 20vc
20VC Exclusive: Mercury Founder Launches First $26M Fund with Immad Akhund · 20VC with Harry Stebbings
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In this episode of 20VC, host Harry Stebbings interviews Mercury founder and CEO Immad Akhund to discuss the launch of his new $26 million institutional fund, his strategic approach to angel investing, and his contrarian insights on startup valuations, founder psychology, and the artificial intelligence landscape.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 21.3% of the talking time here. How this is scored →
Harry as informed peer 5.5 Guest teaching 5.5 Guest disagreement 2.6 Harry pushing back 4.8
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 36:11 Guest rejects host's SPV advice
Immad flatly rejects Harry's unsolicited advice to skip reserves in favor of SPVs, stating founders dislike SPVs and calling them FOMO-driven.
Hardest push from Harry ▶ 48:53 Host challenges CEO raising external LP moneyHarry forcefully challenges Immad's decision to take outside LP capital, arguing that managing external funds creates conflicting responsibilities for a full-time CEO.
Biggest teaching moment ▶ 42:15 Guest demystifies space tech market categoriesAfter Harry admits complete ignorance about space tech, Immad systematically educates him on how satellite imaging, rockets, and comms form the actual space economy.
Harry holds his own ▶ 22:59 Host invokes Bill Gurley's 10x valuation frameworkHarry uses Bill Gurley's 10x revenue rule across cycles to demonstrate that Airtable would need $5B in revenue to justify a $50B valuation.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| The $26M Fund Announcement | 6 | 5 | 2 | 5 | Harry probes Immad's angel learnings and challenges conventional views on founder pushback and platform value add, which he bluntly labels an excuse for management fees. Immad offers nuanced counterpoints regarding young founders and net value from founder networks. | |
| The Sequoia Investment & Diligence Process | 4 | 4 | 1 | 3 | Harry asks about Sequoia's brand impact and diligence process during Mercury's Series C. Immad details Sequoia's extensive customer diligence and partner conviction. | |
| Valuation Strategy & Raising Large Rounds | 6 | 4 | 3 | 6 | Immad shares a contrarian view on taking high valuations like Mercury's 120x Series B. Harry pushes back firmly, citing his ongoing Twitter debate with Parker Conrad that inexperienced founders usually burn cash raised at bloated valuations. | |
| Truebill and the Power of Serial Founders & Naivety | 5 | 5 | 2 | 4 | Immad recounts his Truebill angel win and strong preference for serial founders with something to prove. Harry forces him to pick a side between serial and first-time founders, leading to a discussion on founder naivety. | |
| Angel Misses, Portfolio Diversification & Decacorn Hunting | 4 | 6 | 2 | 3 | Immad outlines his mistake passing on Scale AI and explains the math of seed entry prices, demonstrating why modern seed funds must target decacorns over standard unicorns. Harry guides the conversation to extract portfolio strategy insights. | |
| AI Moats, Revenue Skepticism & the Future of Software Engineering | 7 | 6 | 3 | 5 | Harry cites Bill Gurley's 10x revenue rule to challenge Airtable's $50B valuation trajectory and brings up AI coding productivity stats from HubSpot and Salesforce. Immad details his skepticism regarding temporary labor-replacement AI revenues vs durable workflow tools. | |
| Mercury's Strategic Decisions, delayed Credit Card & Competition Philosophy | 6 | 5 | 3 | 6 | Immad admits Mercury delayed its credit card launch relative to Brex and Ramp. Harry pushes back with 7 Powers counter-positioning frameworks and directly asks why competitors command double Mercury's valuation despite lower account scale. | |
| The $26M Fund Strategy & Follow-On Reserves Debate | 7 | 6 | 5 | 7 | Immad explains his $26M fund structure and check sizing. Harry interrupts to explicitly advise Immad against reserving capital in favor of doing SPVs, but Immad strongly rejects the idea, noting founders dislike SPVs and FOMO dynamics. | |
| Navigating AI Hype & Valuation Math at Seed Stage | 5 | 6 | 3 | 4 | Immad breaks down why seed-stage AI valuations are overhyped and mathematically difficult to justify for repetitive ideas. Harry prompts him to detail his specific filtering criteria when backing AI startups. | |
| Demystifying Space Tech & Managing Time as a CEO-Investor | 3 | 8 | 1 | 2 | Harry openly admits complete lack of knowledge about space tech and asks Immad to educate him. Immad breaks down the sector into three distinct commercial markets: rockets, satellite imaging, and communications. | |
| Raising a $26M Fund & Debating the CEO-Investor Responsibility | 7 | 5 | 4 | 8 | Harry directly challenges the ethics and responsibility of an active $5B company CEO raising external LP capital for a side fund. Immad counters that his angel deal flow and early founder network directly fuel Mercury's customer acquisition. | |
| The Future of Venture & the Public Market IPO Problem | 6 | 6 | 2 | 4 | Harry references the Collison brothers' critiques of public markets and questions why successful tech companies would IPO today. Immad explains macro public market structural issues while advocating for liquid employee secondary options. |
Statements from this episode (38)
Akhund: Entrepreneurs Find It Very Hard Not to Chase Highest Valuation
“I think it is very hard as an entrepreneur not to chase the highest valuation.”
Akhund: Mercury raised Series B at irrational 120x multiple, would do again
“You know, we did our series B at a 120 X, which was not rational. This is 20, 21, but we did it and I would do it again.”
Akhund: Strong Investment Bias Toward Serial Founders with Chips on Shoulders
“I mean, I just prefer serial founders. Like I have such a bias towards them. A serial founder with the chip on their shoulder. Oh yeah. A hundred percent.”
Akhund launches first $26M institutional fund with partner Yash Doshi
“Yeah, I finally closed on my first institutional fund. We raised twenty six million dollars. I'm partnering with kind of a friend of mine. Actually he invested in Mercury seven years ago. His name's Yash Doshi. He was at EQ two ventures, EQT ventures.”
Akhund has made about 350 angel investments since 2016
“Yeah, I've been doing angel investing actually since 2016. So I've done about 350 investments.”
Akhund: Rappi hit unicorn status within a year of my seed investment
“Rappi was one of my first investments. Rappi is like a door dash for LADAM. Yeah. I literally invested and they did not talk to me again. Like they were just so busy and they grew that thing like crazy. And it was a unicorn within a year and a half. I invested…”
Akhund: Andreessen Horowitz invested in Mercury's seed round based solely on a deck
“Andreessen Horowitz was our seed investor. So they invested like basically on a deck for Mercury”
Akhund: Sequoia Performed the Most Diligence Out of 20+ Series C Pitchers
“I pitched more than 20 funds as part of the CBC. Sequoia did the most work. Right. So like they did the most diligence with customers. They did the most work in the data room.”
Akhund: Sequoia Partner Reached 95% Conviction on Mercury in First Meeting
“Sonia is, is our kind of partner at Sequoia, and she said, actually, like, You know, she had conviction in that first meeting. She said, 95% she was in after, like, that initial meeting”
Akhund: If you get a massive valuation, raise big but don't spend
“I think the mistake is to not raise enough money. Like every now and then someone gets like a, you know, like a million dollar valuation, they raised like fifty million. I think that's a mistake. Like you want to raise enough money at that high valuation. And …”
Immad Akhund: Mercury had only 40 employees when raising $120M Series B
“When I raised a hundred twenty million, I was like, I don't know how I'm going to spend a hundred twenty million. Like we had like a 40 person company”
Immad Akhund generated over a 30x return on pre-seed investment in Truebill
“I don't know if I should say the exact multiple, but more than, like, 30 x, ah, it was a great multiple, and it was a short time period, like, 2016 to 20, 21.”
Akhund: Dedicated fintech funds refused to invest in Mercury's seed round
“Even after Andreessen had come in with a lead check, it was so hard to get any fintech fund to invest alongside them because all fintech funds saw was like all the problems. They were like, this doesn't work for this reason and that reason. And I was like, I r…”
Akhund: I passed on Scale AI because the founders were too young
“I saw scale AI and I was like, okay, you know, like good idea, but these people are so young. I think they were like 19 and 20 at the time or something. I was like, yeah, this is like, I was like, I think I could run this company better if I was doing it and I…”
Akhund: Angel investors need at least 20 to 30 investments
“Doing like one or two is not going to make a difference. Like I think, so mostly I say to people, hey, if you have enough money, I mean, we're not talking about a ton of money, but if you have enough money to do at least 20 or 30 investments, that's when you s…”
Akhund: At current seed valuations, investors must hunt for decacorns, not unicorns
“What we're really doing as seed investors is unicorn hunting, or I would say even, like, at these current evaluations, like, you're hunting for decacorns, and that doesn't, yeah, even if you're great at picking and you have a great network, et cetera you're no…”
Akhund: Seed investments in unicorns can return as low as 8x
“If your entry price is like, 20, 25 mil you know, after you get that dilution you know, unicorn, like, sometimes it's like, I've seen as low as, like, eight X return from, like, a seed stage investment to unicorn”
Akhund: Airtable can reach a $50 billion valuation within 15 years
“I'm in it for the game as it was, and I do think, you know, these kind of compounders like Airtable you know, like there's companies I'm in where I'm like, okay, I can see this being a fifty billion dollar company, and if I just stick with it for, you know, ma…”
Akhund: AI labor-replacement software margins will collapse under market competition
“So yeah, the sell that like VCs get and entrepreneurs are making is, oh, we're replacing your labor costs. Therefore, we should charge a third of that. But the reality is, once you have a competitive market dynamic, like, the actual margins are going to compre…”
Akhund: Mercury will employ more software engineers in five years despite AI
“I think we'll have more. Like, I think the maybe I'm contrarian about it a little bit, but to me, if my engineers get more productive, I'm gonna come up with more things to do. Like, I'm gonna have, like, so much stuff that I want to do.”
Mercury Credit Card Outpaces Competitors Among Own Customer Base
“Now Mercury for Mercury customers, Mercury credit card is bigger than all the other kind of corporate credit cards on the platform”
Akhund: New Fund Will Target 60 Non-Lead Startup Investments
“The idea is to invest into 60 companies and The reason that works is, you know, we're doing these non-lead checks.”
Akhund: Avoiding AI Investments as the Sector Is Overhyped and Overvalued
“And, you know, I've ended up especially recently avoiding AI. I think AI is overhyped and overvalued.”
Akhund claims most seed-stage AI startups lack real traction
“The vast majority of AI at seed out there does not have traction.”
Akhund: Space tech currently has only three functional markets
“There's, like, basically three existing markets in space tech. There's rockets, right? Like, getting things up and down, which obviously SpaceX dominates. There's taking pictures from space and That's actually, like, pretty big market, like, forty billion doll…”
Akhund: I don't invest in biotech because founder claims are hard to evaluate
“I don't personally do bio because, you know, I speak to someone and they're like, we've cured cancer. And I speak to the next person and they're like, we've cured cancer. I'm like, I don't know.”
Akhund: Founders still allocate me $150k after hotshot VCs close the round
“I've done rounds recently where the round is fully done with, like, some hotshot VC, and then I still get my one 50 K, and after the round is fully done so winning is, like, Easy right now.”
Akhund Secured Core Allocations for $26M Fund in Three Weeks
“The actual, like, getting, you know, the core allocations done was probably, basically, like, three weeks.”
Fund of Funds Account for ~60% of Akhund's $26M Fund
“Yeah, fund of funds is like sixty-ish percent and then a bunch of kind of entrepreneurs and GPs is like the bulk of the rest of it.”
Akhund: 100% of Mercury's first 30 alpha customers were my angel investments
“You know, actually like the, from the first 30 kind of alpha customers in Mercury, I think a hundred percent of them were like companies I'd invested in.”
Akhund: Multi-stage venture capital funds will inevitably go public
“It seems inevitable that a few of these multi-stage funds will IPO and be public companies, right? Like we had some stuff about GC doing it. Yeah. I think that's just going to happen.”
Akhund: Mid-sized venture funds will struggle while small and mega funds thrive
“The people like me that are investing kind of smaller checks, like we'll do fine and the multistage ones will do fine. I don't know what happens in the middle. I think the middle will have more of an issue.”
Akhund: Mercury will eventually go public, but delay for five to seven years
“I want Mercury to be like a legacy long-term company. So being public is inevitable, but yeah, why do it today and not five years from now on, six years from now, seven years from now”
Immad Akhund: Thesis-driven funds are inferior to broad investing strategies
“I tend to, for deals I receive, I actually think thesis driven funds are not that great. Like I think it's better to have like a broad, broad investing strategy, but for deals that I receive, I kind of like thesis driven funds because I'm like, okay, they know…”
Akhund: Mercury raised too much in its seed round, causing high dilution
“It's like we raised too much money in our seed round. Like we raised six million at like a twenty three million valuation. And like, this was because I was like, okay, fintech is hard. Like I want to have so much money that like I can go on for three years wit…”