I will say, for what it’s worth, that the customer experience of using Brex is really quite outstanding (my current startup is a customer.)<p>They’ve figured out things that in hindsight just seem so obvious to a good UX, and yet we’ve all been so trained to have low expectations from the mediocre service traditional banks/corporate card providers offer that it seems outstanding.<p>From limited experience - the fact that virtual cards are first-party citizens, the helpful text messages you get (which include a warning the first time you use a card physically, instant text records when you use a card physically, the ability to photograph receipts and send them back to that same text phone #, and and and.)<p>American Express (my only other corporate card comparison) of course _could_ offer this stuff, but it’s just not in their DNA because, well, they haven’t had to innovate because they had what amounts to a monopoly on corporate spending cards. And I should note - Amex ties the credit on those cards to the founder (requiring a personal guarantee until the company reaches a certain - large - size.)<p>Anyway, this is all to say I’m a fan and it doesn’t surprise me they’ve having the success they are so far. Let’s hope they can do it profitably and keep it up!
I ran a bootstrapped company with $150k/mo of well-documented, above-board recurring revenue and Chase wouldn't give it a credit limit above $5k.<p>Entrusting my finances to another startup like Brex is scary, but damn is the pitch compelling compared to mainstream banks.
This Pedro Franceschi is the same kid that created iUsers to allow multi-users in iPad and hacked Siri to understand portuguese years before Apple. I’m really happy that their startup has a big potential and I hope it succeeds, I’m a real fan
As this is Hacker News, Paul Graham's comments on Yahoo during the .com bubble are particularly relevant:<p>By 1998, Yahoo was the beneficiary of a de facto Ponzi scheme. Investors were excited about the Internet. One reason they were excited was Yahoo's revenue growth. So they invested in new Internet startups. The startups then used the money to buy ads on Yahoo to get traffic. Which caused yet more revenue growth for Yahoo, and further convinced investors the Internet was worth investing in. When I realized this one day, sitting in my cubicle, I jumped up like Archimedes in his bathtub, except instead of "Eureka!" I was shouting "Sell!"<p><a href="http://www.paulgraham.com/yahoo.html" rel="nofollow">http://www.paulgraham.com/yahoo.html</a>
Brex's PR firm certainly seems to be earning their keep. This is the third or fourth article about Brex that 'wasn't about Brex' I've seen on HN in the last couple of months.
Isn't this just a reformation of the idea there's only two business models?<p>Either you mine for gold yourself or you sell shovels to others who want to mine for gold.
Brex sounds like it’s headed for bankruptcy based on the article. They’re unprofitable now, and have incredibly risky clients sitting in front of what feels like a looming recession.
It seems like it's doing well because things are bad in silicon valley, not in spite of.
It sounds like there are a lot of desperate startups getting loans to 'simulate' growth by having negative profit margins (since they can't get real growth otherwise), then they use that fake growth to get investors' money which they use to service debt, then they keep raising money until they exit or IPO.
It doesn't seem sustainable. All these debts end up the hands of corporate shareholders. There's a point where companies and the public will stop buying useless startups (if that point hasn't already passed).
It’s nothing more than the same Ponzi scheme we saw in 1999. If venture funding dries up, for their customers, they are also toast. I hate that the modern idea of a “successful” company is how much money they can raise and at what evaluation.
I think this is a good example of a "Submarine"[0] article<p><pre><code> [0] http://www.paulgraham.com/submarine.html</code></pre>
For those that are familiar with the service are they really mostly/only focused on companies that have outside investment?<p>From glancing at their literature it seemed like their gig was lending money to companies that actually already had the money in the bank, like providing company spending cards to a startup with a few million in VC money sitting somewhere.<p>Is that correct or do they lend to companies with more traditional economics, like a bootstrapped company with a million or two in annual revenue but without major cash reserves or investment?
Startups serving other startups sounds exactly like the dot com boom/bust. When the bust started, it spread across the entire Valley because exactly this.
I don’t understand the economics of Brex. I used to work for a large, analytics-savvy credit card company, and people would freak out if the percentage of customers going bad (not paying their debt) exceeded something like 3-5%. Given that VC-funded startups fail at a rate of 11/12, isn’t Brex effectively throwing money down a massive black hole, assuming they’re extending credit? And this is at the top of credit cycle, probably within a few years of a recession, where a higher than normal percentage of good debt will go bad too.
Bad times? Only lazy bums like me and poor H1s are still sitting at our old BigCo (life work balance is amazing, plus there are too few of us left who is doing the stuff so we are treated pretty soft and accurately :) . Anybody who left during the last year and a half got minimum 300 (junior and/or really incapable engineers) with the normal engineers getting 400-500K and that isn't in a red hot AI and the likes. The money is just sloshing around. Granted everything comes to an end, and we're definitely due for the one, yet it definitely didn't happen yet.
The Brex interview handed out real customer bank balance and transaction history and suggested that that data was all they they used to build their underwriting model.
How is it different than say, stripe issuing?<p><a href="https://stripe.com/nz/issuing" rel="nofollow">https://stripe.com/nz/issuing</a>
I offer small services other startups too <a href="https://launchpropeller.com/#/" rel="nofollow">https://launchpropeller.com/#/</a>