Brex Raises $57 Million to Launch New Credit Card for Startups

StaffeCommNews, ENTBusinessNews, EnterpriseWebPro, SmallBusinessNews

Share this Post

American fintech company Brex has just launched a new corporate credit card designed specifically to assist startups.

The news of this unique credit card also comes on the heels of Brex's recently concluded Series B funding round. The company was able to raise $57 million courtesy of investors like PayPal co-founders Max Levchin and Peter Thiel, Facebook's Yuri Milner, VC Ribbit Capital, and the Y Combinator Continuity.

Brex is the brainchild of young engineers cum entrepreneurs Henrique Dubugras and Pedro Franchesci. The two are known for founding, a Brazilian payments processor, when they were still in their teens.

Brex wants to rebuild B2B financial products, and one key step to doing that is to start with a corporate credit card service. The company provides tech startups and various companies with instant approval of credit cards. What's more, these have higher than expected credit limits and users don't require any kind of personal guarantees.

The San Francisco-based company basically underwrites businesses and foregoes credit history in lieu of factors like its investors and the equity the company holds, its cash balance and spending habits. Brex offers the first five cards of the startup free of charge. Any additional cards after that will cost $5 monthly.

Brex credit cards offer several distinct features, like the capacity to capture receipts using your smart device and matching them to the card holder's credit statement. The card can also be integrated with accounting software like Expensify, NetSuite, and QuickBooks.

Dubugras and Franchesci reportedly spent the previous year talking with customers about developing a product that could successfully navigate the regulatory and financial challenges that usually prevent early-stage startups from getting credit card approval.

According to Brex CEO Dubugras, “startups that have raised millions and are poised for hyper-growth can't get slowed down hassling with banks requiring personal guarantees and offering meager credit limits.”

Unfortunately, traditional credit models look at how much a company can pay back annually based on revenue. This practice automatically disqualifies startups. But Brex has gotten around that problem by focusing on the cash that the investors have given the startup.

[Featured image via Pixabay]
WebProNews | Breaking eBusiness News