“No documents required. No notarized seals. No EIN whatever the hell that is,” reads the Nerve website. “Just a smart, simple way to manage the money you make from making music.”
Nerve is a challenger bank for musicians based in Austin, Texas that’s readying itself for a September launch. After, it will onboard its waiting list of customers over the next several months. At the moment, Nerve is offering a business account and a savings account with a whole host of other features.
Nerve CEO John Waupsh says that a business checking account can involve high fees and extensive documentation that can put off early-career musicians who want to open a business account. Often, they’re making between $150 to $500 per month, but the ramifications of co-mingling their money or not managing their cash flow. also weighs heavy, by leaving them open to tax issues, among other things.
Waupsh says that banks often don’t have a good understanding of how artists make money or get paid. Artists today can have up to 20 to 50 streams of revenue, not necessarily generating big dollars but contributing to their income nonetheless. Nerve provides a way for artists to consolidate revenue from each source into their Nerve account.
Moreover, banks have little idea about what social media data has to do with income generation. As such, the banking app is equipped with a feature that allows customers to link their social media and streaming data into the app. Instead of visiting apps like Spotify and Instagram separately, customers can log into their Nerve app and have all that data there, side by side with their money, with just a swipe.
“A big part of creating a sustainable business is knowing whether you’re winning or losing,” says Waupsh. “Having [the data] right next to the money [was] really important for musicians who are [creating] sustainable businesses.”
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While Nerve doesn’t offer any lending products at the moment, pulling all that data into Nerve will help build the case for each musician to borrow when Nerve launches lending products. Nerve also provides a private networking feature to help professional musicians find each other, make payments, and collaborate. Nerve customers will also get free instant payments to other Nerve accounts, as well as access to 55,000 free ATMs
Nerve is working with Piermont Bank to provide FDIC-insured business debit and savings accounts to ‘help musicians separate his business and personal financial life.’
“We are excited to be the bank partner who provides the banking products and services behind Nerve’s offerings. As a bank with expertise in supporting the fintech ecosystem and entrepreneur-led businesses, we find good synergies in our partnership with Nerve,” says Rodrigo Suarez, head of innovation at Piermont Bank. “We are in an excellent position to work closely with Nerve’s team to support their product roadmap to serve independent creators in the music industry.”
Josh Liggett, principal at investment platform OurCrowd, is a little skeptical. He doesn’t so much mind that there’s a niche challenger bank for musicians but that in his experience, most challenger banks aren’t doing anything particularly disruptive or groundbreaking from incumbents. Liggett gives the example of his musician wife, who gets cello insurance and buys an airplane ticket for the instrument when she travels with it. Liggett would like to see customer-specific offerings from challengers targeting certain market segments — in this case, something different like insurance or discounts on air travel for seats bought for their instruments.
“If you want to have a whole challenger bank dedicated to a market segment, that’s fine,” says Liggett. “But you better offer something that’s really interesting to them. And if you’re just offering regular banking services to somebody like musicians, lumberjacks, astronauts or scuba-divers, it doesn’t matter until you’re actually providing something that’s unique to them.”