Palmer Luckey’s technology-focused Erebor bank has attracted more than $7 billion in deposits months after opening its doors to the US tech industry.
Founded by the Oculus and Anduril entrepreneur in February 2026, the bank has signed more than 500 customers as it tries to fill the hole left by Silicon Valley Bank’s spectacular collapse in 2023.
According to the Financial Times, Erebor is targeting technology, defence and manufacturing start-ups which have struggled to find banks comfortable with their peculiar combination of enormous ambitions and occasionally microscopic revenues.
Luckey founded Erebor with former Palantir executive Joe Lonsdale and banker Jacob Hirshman, who serves as chairman. The bank has backing from venture capital outfits including Andreessen Horowitz, Founders Fund and Lux Capital.
Its deposit growth has been considerably faster than its lending. Erebor had issued only about $78 million in loans by the end of the second quarter, leaving most of its assets sitting in cash and balances with other banks.
That conservatism appears deliberate. Silicon Valley Bank collapsed after investing large quantities of customer deposits in long-dated securities which lost value as interest rates rose. A run on deposits finished the job with impressive efficiency.
Erebor appears determined not to recreate that particular piece of Silicon Valley history while attempting to inherit its customers. The bank reported a second-quarter net loss of $10.3 million, although management expects it to become profitable before the end of 2026.
Its customers include defence and advanced manufacturing companies, sectors which have become increasingly important to US venture capital investors. Erebor has already appeared in some enormous financing deals.
The bank is advising data-centre outfit Fluidstack on a proposed $5 billion loan backed by the US Department of War’s Office of Strategic Capital. Luckey has ambitions considerably larger than operating a specialist lender for start-ups.
Erebor eventually wants to compete with major international banks and is examining overseas expansion as US technology companies increasingly operate in emerging markets.
The Financial Times deep throats claim the bank is considering services in countries including Venezuela and Syria following changes to US sanctions.
The bank is exploring dollar-backed cryptocurrencies for round-the-clock payments, giving customers a way to transfer funds outside conventional banking hours. For now, the more striking figure is the $7 billion which customers have already entrusted to a bank that did not exist at the beginning of the year.
