Erebor

Erebor is a federally chartered, FDIC-insured national bank headquartered in Columbus, Ohio, with a secondary office in New York, operating as a branchless, digital-only institution. It was founded in 2025 by Palmer Luckey, co-founder of Oculus VR and Anduril Industries, together with Joe Lonsdale, and cofounders Trevor Capozza, Jacob Hirshman, Aaron Pelz and Owen Rapaport. The bank targets the US "innovation economy": venture-backed startups and established companies in artificial intelligence, cryptocurrency and digital assets, defense technology, robotics and advanced manufacturing, along with the venture funds, investors and high-net-worth individuals connected to those sectors. It does not serve the retail mass market.

Erebor filed its national bank charter application with the OCC on 11 June 2025, received preliminary conditional approval on 15 October 2025, obtained FDIC deposit insurance approval in December 2025, received final charter approval on 6 February 2026 and opened for business on 8 February 2026 — reported as the first de novo national bank charter approved under the current US administration. It launched with roughly $625-635 million of initial capital. Products include FDIC-insured business deposit accounts, ACH and wire transfers, batch payments, multi-party approval workflows, treasury management, cross-border payments, and developer APIs that allow other fintechs to use Erebor as a banking backend. On the credit side it underwrites collateral that most banks avoid, including cryptocurrency, private securities, GPU clusters and other AI hardware, precision machine tools, and government defense contracts.

The bank combines traditional rails with stablecoin and blockchain-based settlement intended to operate 24 hours a day, including weekends and holidays; it opened deliberately on a Sunday to demonstrate continuous settlement. In April 2026 the Sui Foundation announced Erebor had added support for the Sui network for stablecoin deposits and withdrawals.

Founding story

Erebor was founded in 2025 by Palmer Luckey and Joe Lonsdale in response to the March 2023 collapse of Silicon Valley Bank, which had served as the primary banking partner for technology startups and their venture backers. Luckey, who encountered financing obstacles while scaling hardware-intensive companies, has described the concept as a "farmers' bank for tech" — an institution with the in-house expertise to value machine tools, GPU clusters and aerospace contracts the way a rural bank values agricultural equipment. The name refers to the Lonely Mountain in J.R.R. Tolkien's The Hobbit, echoing the Tolkien-derived naming of Palantir, Anduril and Mithril Capital in the founders' and investors' orbit.

Business model

Erebor is a vertically integrated B2B commercial bank that owns its charter, balance sheet and compliance stack rather than renting access from a sponsor institution. It gathers large deposits from a small number of capital-intensive corporate customers, deploys them into short-duration bonds and loans, and earns the spread, supplemented by fee income. Reported figures describe roughly 500-600 customers with an average of about $7 million on deposit each, translating to approximately $175,000 in annualized revenue per customer, and a conservative balance sheet with a 12% Tier 1 leverage ratio, about 77% of deposits insured and roughly 69% of assets in short-duration bonds.

Revenue comes primarily from net interest income on deposits, reported at about 68% of the total, with the remaining 32% from noninterest sources including wire and ACH fees, account fees and banking-as-a-service fees from its API business.

Traction

Erebor gathered $1.1 billion in deposits in its first seven weeks after opening in February 2026, reached $4.1 billion by the end of Q2 2026 and $4.6 billion by the end of July 2026. Its loan book grew from zero to $77.2 million by the end of June 2026. Annualized revenue was estimated at $31 million in March 2026 and $112 million in July 2026, and press reports cite the bank surpassing $100 million in annualized recurring revenue. Filings showed $597.4 million of equity remaining as of 30 June 2026 after organizational costs and early losses.

Latest developments

In August 2026 press reports said Erebor was in late-stage discussions for a funding round of roughly $1.5 billion at an $8 billion pre-money valuation, with likely participants including Lux Capital, Human Capital, Valor Equity Partners, Andreessen Horowitz and SV Angel, and existing shareholders 8VC and Haun Ventures expected to participate. The same reports noted deposits of $4.6 billion at the end of July 2026, annualized recurring revenue above $100 million, and the addition of former US official Michael Mosier and former American Express executive Anré Williams to the board. One analysis reported the bank in talks at a $9.5 billion post-money valuation.