How the founders of Brex built a billion-dollar business in less than 2 years

Many of the posters in this thread miss the point, perhaps because they have not tried to get a credit card for their startup or small business.<p>Even if you have millions in the bank, the process of getting a card is long and tedious. It took me weeks, hours of phone calls, visits to the bank, and affected my personal credit. In the end a well-known card provider gave us a $5000 limit. We sometimes put that much on the card in a few days, and autopay is monthly, so someone had to manually monitor the card balance just to keep the card working.<p>The experience of being a small business that wants to use a credit card sucks. It&#x27;s not even a little surprising to me that Brex is doing great.

So where does the revenue come from? A slice of the transaction fees run on the cards or interest on rolling balance? I can’t imagine the balances over 30 days being that high (the targets have VC money to pay their bills right?) and the transaction fees can’t be that much either.<p>I can see why they’d need a lot of capital but I fail to see the business model for actually generating (big) income.

And nobody suggested they change the name?<p>You have a Brex card, you offer to pay for something: &quot;Sure, I&#x27;ll just Brex it...&quot;

I don&#x27;t understand this, what is their business model exactly? Aren&#x27;t they just giving out loans like a VC with other VC money? Why can&#x27;t the VCs invest directly without Brex taking their cut?

It seems to me it&#x27;s similar to <a href="http:&#x2F;&#x2F;pleo.io" rel="nofollow">http:&#x2F;&#x2F;pleo.io</a> but they haven&#x27;t raised that much money yet. Why is that?

That&#x27;s impressive.<p>I always wanted to have an approval-flow for payments for company cards, would be a great addition.<p>I&#x27;d be fine issuing cards to everybody in the company as long as I can prevent the expense before it happens (and revoke credit card numbers when off-boarding employees).<p>my 0.02 cents

It seems kind of crazy to see VC funding for a startup that focuses on selling services to other startups that need VC money to exist...

It’s an interesting concept for sure. But one thing that seemed confusing was how exactly do they handle underwriting? Do they credit check the applicants? Employees? Check the business bank accounts?<p>Granting credit is a sophisticated market, is this just a case where they look for founders that have perfect credit and assume they’re probably OK? Do they even use standard CRA’s at all?<p>Like what’s the basic underwriting premise?

Not to be confused with Bre-X. <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Bre-X" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Bre-X</a><p>Subject of the film Gold. <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Gold_(2016_film)" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Gold_(2016_film)</a>

This isn&#x27;t a &quot;billion-dollar business&quot;; it&#x27;s an overhyped company that gives credit cards to startups that raised money at a billion-dollar valuation.<p>They may have already reached their entire market for their existing business; the billion-dollar valuation only makes sense if they can plan to grow into other credit card markets.

You can’t patent a credit product. As soon as other lenders see this business, their margins will be competed away. That 2BN valuation looks very artificial.

A financial company is going to extend 10x as much credit as established institutions (<i>without</i> collateral) to random startup execs? And two other selling points being that they&#x27;re writing a financial platform from scratch and you&#x27;ll get your card more quickly so your business doesn&#x27;t fail from waiting on the mailman to deliver a normal business credit card?<p>The APR would have to be sky-high and would start accruing the day after. There&#x27;s a reason banks don&#x27;t give a shitload of money to just anyone who can pay ~$1,000 form a corporation.<p>Are they going to write fraud detection from the ground-up too? Same with all of the customer support apps that allow reps to deal with issues?<p>This makes <i>no sense</i> to me. The risk here seems stratospheric unless &quot;Visa Commercial&quot; is already offering all of these, and Brex is just re-branding it.<p>Edit: Pagar.me would count as financial experience. I missed that sentence in the article.

The perfect card for the UK after March 2019. I will just BrexIT the expenses.

Isn&#x27;t issuing credit cards to Startups, almost like equivalent to issuing cards to gamblers in Vegas?