Brex: Empowering Employees to Make Better Financial Decisions

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Innovative companies in this modern corporate world are at the cutting edge of how to run a business. Modern businesses seek ways to empower their teams, automate workflows, digitize information, and operate globally. Many companies are shifting to advanced solutions, investing in new paths, and breaking the old ones to do business differently.

Almost everything about businesses has changed, but banks haven't. Companies, especially early startups, still struggle to get financial support from the banks. So, companies need innovative products to help meet their financial requirements while empowering employees to make better financial decisions to drive the business forward.

Brex, an American company, has built a first-of-its-kind solution integrating the financial services and software companies will need along the way. To learn more about the company, consider going through the article.

Brex – Company Highlights

About Brex
Brex – Industry
Brex – Founders and Team
Brex – Startup Story
Brex – Mission and Vision
Brex – Business Model
Brex – Revenue Model
Brex – Products and Services
Brex – Challenges Faced
Brex – Funding and Investors
Brex – Mergers and Acquisitions
Brex – Growth
Brex – Marketing Strategies
Brex – Partners
Brex – Awards and Achievements
Brex – Competitors

About Brex

Brex is a California-based financial technology company that developed the SaaS-driven credit card and spend management solutions platform. Its unified platform offers corporate cards, expense management, travel, reimbursements, business accounts, and bill pay.

The company serves startups, e-commerce brands, and scaled companies, helping their founders, CFOs, and teams spend smart and move quickly. Y Combinator, Airbnb, Carta, CLSA, Sonoma, ClassPass, and Bounce are some leading customers of Brex.

Brex – Industry

Brex operates in the fintech industry. In 2018, the global fintech market was estimated at 92 billion euros, and in 2024, it's forecasted to grow to 188 billion euros, with a noteworthy CAGR of 12% from 2018 to 2024. Some essential market growth driving factors include increased penetration of the internet, use of smartphones, and adoption of cashless currency and digital technology during the Covid-19 pandemic. Visa, Mastercard, Stripe, PayPal, Tencent, and Ant Financial are some companies capturing a significant share of the fintech industry.

Brex – Founders and Team

Pedro Franceschi and Henrique Dubugras are the Co-Founders of Brex.

Pedro Franceschi

Pedro Franceschi is the Co-founder and Co-CEO of Brex. He is a Computer Science graduate from Stanford University. He worked as Software Engineer at M4U. Franceschi founded Pagar.me in April 2013, and the company was acquired in September 2016. Currently, he is the Board Member at Coupang.

Henrique Dubugras

Henrique Dubugras is the Co-founder and Co-CEO of Brex. He completed his bachelor's in Computer Science from Stanford University. He is the ex-founder of EduqueMe and Pagar.me. Currently, Dubugras is the Board Member at Mercado Libre and Expedia Group.

Brex is a team of approximately 1,100 employees.

Brex – Startup Story

Pedro Franceschi and Henrique Dubugras founded Brex on January 3, 2017. It wasn't first started as a fintech startup but as a VR startup. However, Franceschi and Dubugras pivoted the company three weeks into Y Combinator's 12-week accelerator program.

When the founders joined the YC W17 batch to start a VR company, they encountered a problem. They applied for business credit to fund software and other expenses, but it was denied. During that time, business credit was traditionally underwritten based on the FICO scores of founders. But since Franceschi and Dubugras were international founders with less than a month of credit history, there was little to no chance for business credit card approval, despite having $125K in the bank.

They discovered it wasn't just them who faced this problem. While early startup founders could access high-fidelity payment products like Stripe from the get-go, getting access to basic cash management and credit products was a terrible experience for every founder. Cards were particularly a must-have for early startups since large vendors don't use often accept ACH and other forms of alternative payment from young companies. And therefore, founders used to end up using their personal credit cards for SaaS subscriptions, digital marketing, and filing reimbursements regularly.

To address the extremely low penetration of credit cards in the B2B space, Franceschi and Dubugras pivoted and built Brex. The company's initial product was a simple 30-day charge card for startups with credit limits based on cash balance. In 2021, the company announced the submission application with the FDIC (Federal Deposit Insurance Corporation) and the UDFI (Utah Department of Financial Institutions) for establishing an industrial bank, "Brex Bank," Brex's wholly-owned subsidiary. In the same year, in August 2021, it launched Brex Venture Debt.

Later in April 2022, it launched Brex Empower, a financial software platform, and in June 2022, the company exited the small and midsize businesses market. In March 2023, Brex launched Travel Solution, and in August 2023, it launched Payables.

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Brex – Mission and Vision

Brex aims to empower employees anywhere to make better financial decisions.

Brex – Business Model

Brex offers a corporate credit card, cash account, and various software tools to manage expenses, taxes, and bills. It started by explicitly targeting early-stage technology startups needing quick and reliable access to capital. In addition to startups, the company also offers cards to life science, late-stage, e-commerce, and enterprise companies. Currently, Brex shifted its focus from small businesses to larger companies.

Brex analyzes the firm's financial backing, spending patterns, sales volume, and other data points, along with the applicant's personal liability, before issuing the business credit card. The company's card is a charge card that clients must pay off in full every 30 days.

Brex – Revenue Model

Brex generates revenue through a monthly account subscription, referral fees from cashback rewards, interchange fees, interest on loans, and interest on cash held in its customer accounts.

Brex – Products and Services

The product offerings of Brex are as follows:

• Corporate Card
• Expense Management
• Travel
• Global
• Bill Pay
• Startups
• Business Account
• Venture Debt
• Financial Modeling
• Integrations
• API
• Mobile App

Brex – Challenges Faced

During 2022, Brex was struggling to serve the divergent needs of its small business customers, many of which were limping forward due to the pandemic hit. Franceschi and Dubugras thought they could diversify the company's revenue and charge customers per head for a new software suite by focusing on large companies.

However, that pivot to SaaS hit some bumps in the road. Brex flubbed telling to its small business clients about shutting down their accounts, which led to social media clangor and a mea culpa from the company's founders. Even the company faced internal outcry, with employees describing Brex's ongoing reorganizations as 'chaotic' while labeling the future 'uncertain.'

Moreover, economic headwinds took a toll on the company, with Brex laying off 11% of its employees in 2022.

Brex – Funding and Investors

Brex has undertaken 12 funding rounds and raised a whopping $1.5 billion. Its latest funding round was Series D Round, completed on May 18, 2022. Some prominent investors backing the company include DST Global, Ribbit Capital, Y Combinator, Kleiner Perkins, Lone Pine Capital, Max Levchin, and Peter Thiel.

Brex – Mergers and Acquisitions

Brex acquired 6 companies and these are as follows:

Brex – Growth

Brex's customer base increased from 100 to 1,000 within five months of launching, and in 2020, it had 20,000 customers. In 2019, the company was valued at $2.6 billion. And after completing its Series D-2 funding round last fall, Brex was valued at $12.3 billion in 2022. Moreover, in May 2023, it announced significant growth with $100M of ARR.

Brex – Marketing Strategies

Brex's initial marketing strategy was all about focusing on friends and family that were founders of finance individuals at small firms and used to ask them to test their products. After some time, the company harnessed the marketing power of billboards, scraped LinkedIn for potential leads, and hosted events with superior-quality speakers to spread the word.

In May 2021, Brex launched an integrated marketing campaign named "All-in-One" that focused on a 'less is more' approach to promote its All-in-One finance solutions.

Brex – Partners

Brex has partnered with the following listed affiliate, accountant, broker & lender, and VC investor & accelerator partners:

• Techstars
• AngelList
• NetSuite
• Coupa
• Gusto
• Workato
• Zapier

Brex – Awards and Achievements

Here listed are some awards and achievements Brex garnered over the years:

• Named to the TIME100 Most Influential Companies list
• Named #2 on the 2023 Top 50 Distributors List of Innovative Companies
• Recognized as one of San Francisco Business Times and Silicon Valley Business Journal's 2019 Best Places to Work

Brex – Competitors

Some of Brex’s main competitors are:

• Stripe
• Square
• Expensify
• Paychex
• SAP Concur
• Navan, Inc
• Coupa
• Pleo

FAQs

What is Brex about?

Brex is a California-based financial technology company that developed the SaaS-driven credit card and spend management solutions platform. Its unified platform offers corporate cards, expense management, travel, reimbursements, business accounts, and bill pay.

Who are the founders of Brex?

Pedro Franceschi and Henrique Dubugras are the co-founders of Brex.

How does Brex generate revenue?

Brex generates revenue through a monthly account subscription, referral fees from cashback rewards, interchange fees, interest on loans, and interest on cash held in its customer accounts.

Who are the main competitors of Brex?

The main competitors of Brex include Stripe, Square, Expensify, Paychex, SAP Concur, Navan, Inc, Coupa, and Pleo.