Mercury, a fintech serving over 200,000 startups, released The New Economics of Starting Up on August 19, 2025, based on a survey of 1,500 U.S.-based early-stage founders and executives. The report reveals how AI adoption is driving hiring, confidence, and scaling in 2025, despite economic uncertainties, offering insights into startup financing, spending, and operational strategies.
79% of AI-adopting startups are hiring more due to AI.
60% of AI-forward startups report significantly improved financial confidence.
AI adopters are 3x more likely to scale teams and 2x more likely to seek larger funding rounds.
61% of startups rely heavily on contractors, with AI adopters 4x more reliant.
73% plan to increase AI tool spending in 2025.
Non-VC funding like bootstrapping (61%) and business loans (47%) dominates.
Despite 89% of founders citing economic uncertainty, 87% report improved financial confidence since 2024. AI-forward startups lead this trend, with 60% noting “significantly improved” prospects compared to 28% of non-AI adopters. Far from replacing jobs, AI is spurring growth: 79% of significant AI adopters are hiring more, particularly in business development (44%), sales (43%), marketing (42%), and customer service (42%). AI adopters are also 3x more likely to scale teams and 2x more likely to pursue larger funding rounds.
Startups are diversifying capital sources, with 61% bootstrapping, 47% using business loans, 41% leveraging revenue-based financing, and 25% securing venture capital. Tech startups are outliers, with 10% raising over $20M, compared to 3-4% in other sectors. Companies using multiple funding sources and VC are 40% more likely to raise over $5M. Two-thirds of founders adjusted their capitalization strategies in the past year, with younger companies chasing larger rounds and established ones prioritizing runway extension.
Among startups with over $10M in revenue, half raised $5-20M, while only 9% exceeded $20M, indicating lean operations. Retail and professional services show slower, relationship-driven growth, with 35% and 32% of $1M+ revenue firms being over five years old, respectively. Ecommerce startups scale quickly, with 55% of $1M+ firms aged 2-5 years, but only 16% survive past five years. Financial services exhibit steady scaling, with 56% of $1M+ firms aged 2-5 years.
Costs rose across all surveyed areas in the past year: customer acquisition (71%), tech infrastructure (69%), talent (65%), capital access (63%), compliance (59%), and office space (57%). Looking ahead, 79% of startups plan increased spending, with 73% prioritizing AI tools, driven by growth opportunities. Contractors are critical, with 61% of startups relying on them, and AI adopters being 4x more likely to heavily depend on contract talent for global access.
Mercury is the fintech that brings all the ways people and businesses use money into a single product that feels extraordinary to use. Mercury gives more than 200K ambitious companies, from small businesses to growth stage enterprises, the banking*, credit cards*, and software they need to power all their financial workflows.
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