Featured Article

How Brex more than doubled its valuation in a year

An interview with CEO Henrique Dubugras


disrupt Henrique Dubugras michelle romanow 0546
Image Credits: TechCrunch

Brex, a fintech company that provides corporate cards and spend-management software to businesses, announced earlier today that it closed a $425 million Series D round of capital at a valuation of around $7.4 billion. The new capital came less than a year after Brex raised $150 million at a $2.9 billion pre-money valuation.

So, how did the company manage to so rapidly boost its valuation and raise its largest round to date? TechCrunch spoke with Brex CEO Henrique Dubugras after his company’s news broke. We dug into the how and why of its new investment and riffed on what going remote-first has done for the company, as well as its ability to attract culture-aligned and more diverse talent.

More customers, more product

Undergirding the company’s financial news today was its announcement of Brex Premium, a software suite that the unicorn intends to charge for. As TechCrunch has written ad nauseam, there has been an interesting rift between corporate spend-management companies regarding whether they charge for the software that they layer around their proffered business plastic. Brex has now crossed this particular Rubicon and joined those that do, at least in some cases.

Brex Premium will run customers $49 per month, which Dubugras described in a call as less expensive than the systems it may replace. For companies looking for integrated bill pay, expense management and the like, it could be a good fit. And the service could bolster Brex’s aggregate revenue run rate with high-margin, recurring software fees that public market investors have long coveted.

On the topic of investors, let’s circle back to Brex’s round. Here’s what we need to know: How quickly has Brex grown in recent months, why did the company choose Tiger as its lead investor (from over $1 billion in demand for the round), and what’s ahead for the company itself?

In order:


Per Dubugras, from March 2020 to March 2021, Brex grew its revenues and TPV, or total payment volume, by more than 100%. As Brex reached $1 billion in TPV during its first seven months of its existence, again according to its CEO, the company’s aggregate TPV add during that 12-month period was in excess of that figure. Multiples higher, by our reckoning.

That growth explains how Brex was able to double its valuation. It grew quickly. How it did so is worth exploring.

According to its CEO, Brex greatly expanded the sort of company that could sign up for its service in January, albeit with a minimum of public-facing noise. So, from venture-backed startups to e-commerce companies, Brex made it possible for any company to sign up for its cards.

However, while its previous customer base could qualify for a 30-day charge card, the broader pool of customers that it began to accrete after the update to its rules is more tied to single-day credit. But by restricting offered credit to effectively a zero time horizon, Brex has been able to onboard more customers without changing its credit risk, Dubugras explained.

Requiring its newly broadened customer base to pay off spend the next day did not hamper Brex’s growth; the company said in an email that customer growth jumped 80% in Q1 2021 from the final quarter of 2020. Today some 45% of Brex customers are small and medium-sized businesses, implying that the category has been a beneficial addition to the company’s growth curve.

Why Tiger?

Seeing Tiger Global lead the Brex round was roughly as surprising as discovering that your local diner serves eggs. But there’s a bit more to the story than just the fact that Tiger is currently on something of a late-stage rampage.

Dubugras told TechCrunch that a multiyear relationship with the investing group allowed both to move quickly. Given that the new round was priced at a level that Brex was sure to appreciate, it’s not a surprise that it was able to close in rapid fashion. The CEO also told TechCrunch that his company was looking for a crossover investor, one that could hold shares even after Brex goes public and perhaps buy some in its eventual IPO.

Brex doesn’t have near-term IPO plans, he added.

What’s next?

This was the second call in a row that TechCrunch has had with Dubugras with the CEO located in Los Angeles; Brex went remote-first in September 2020. We raise that point not merely to note that not every company is gearing up for a return to the old normal, but to bring our conversation to hiring.

Per Brex’s CEO, the move to remote greatly boosted the “TAM,” or number of people it can hire. By fishing for staff outside of the Silicon Valley bubble, Brex has been able to hire more rapidly, more diversely and with a tighter culture fit, its CEO said. Remote-first companies, by fishing in a larger lake that also features fewer corporate anglers, could find a long-term staffing advantage over centralized rivals if they can retain their cultural core.

The company is going to need the staff, given that its leadership is bullish concerning what’s ahead. Dubugras told TechCrunch that he’s very optimistic about what’s to come, that per-customer TPV is rising, among other positive signals. And with the $425 million in new capital giving Brex several years of runway in his view, he can probably get to an S-1 without raising again. Let’s see.

After going public, once-hot startups are riding a valuation roller coaster

More TechCrunch

Andreessen Horowitz’s American Dynamism fund has established a new fellowship program aimed at introducing top engineers and technologists to venture investing, a move that could help the firm less obvious…

a16z’s American Dynamism team launches program to introduce technical minds to VC

Another fintech startup, and its customers, has been gravely impacted by the implosion of banking-as-a-service startup Synapse. Copper Banking, a digital banking service aimed at teens, notified its customers on…

Teen fintech Copper had to emergency discontinue its banking, debit products

Autodesk — the 3D tools behemoth — has acquired Wonder Dynamics, a startup that lets creators quickly and easily make complex characters and visual effects using AI-powered image analysis. The…

Autodesk acquires AI-powered VFX startup Wonder Dynamics

Farcaster, a blockchain-based social protocol founded by two Coinbase alumni, announced on Tuesday that it closed a $150 million fundraise. Led by Paradigm, the platform also raised money from a16z…

Farcaster, a crypto-based social network, raised $150M with just 80K daily users

Microsoft announced on Tuesday during its annual Build conference that it’s bringing “Windows Volumetric Apps” to Meta Quest headsets. The partnership will allow Microsoft to bring Windows 365 and local…

Microsoft’s new ‘Volumetric Apps’ for Quest headsets extend Windows apps into the 3D space

The spam reached Bluesky by first crossing over two other decentralized networks: Mastodon and Nostr.

The ‘vote Trump’ spam that hit Bluesky in May came from decentralized rival Nostr

Welcome to TechCrunch Fintech! This week, we’re looking at the continued fallout from Synapse’s bankruptcy, how Layer wants to disrupt SMB accounting, and much more! To get a roundup of…

There’s a real appetite for a fintech alternative to QuickBooks

The company is hoping to produce electricity at $13 per megawatt hour, which would be more than 50% cheaper than traditional onshore wind.

Bill Gates-backed wind startup AirLoom is raising $12M, filings reveal

Generative AI makes stuff up. It can be biased. Sometimes it spits out toxic text. So can it be “safe”? Rick Caccia, the CEO of WitnessAI, believes it can. “Securing…

WitnessAI is building guardrails for generative AI models

It’s not often that you hear about a seed round above $10 million. H, a startup based in Paris and previously known as Holistic AI, has announced a $220 million…

French AI startup H raises $220M seed round

Hey there, Series A to B startups with $35 million or less in funding — we’ve got an exciting opportunity that’s tailor-made for your growth journey! If you’re looking to…

Boost your startup’s growth with a ScaleUp package at TC Disrupt 2024

TikTok is pulling out all the stops to prevent its impending ban in the United States. Aside from initiating legal action against the U.S. government, that means shaping up its…

As a US ban looms, TikTok announces a $1M program for socially driven creators

Microsoft wants to put its Copilot everywhere. It’s only a matter of time before Microsoft renames its annual Build developer conference to Microsoft Copilot. Hopefully, some of those upcoming events…

Microsoft’s Power Automate no-code platform adds AI flows

Build is Microsoft’s largest developer conference and of course, it’s all about AI this year. So it’s no surprise that GitHub’s Copilot, GitHub’s “AI pair programming tool,” is taking center…

GitHub Copilot gets extensions

Microsoft wants to make its brand of generative AI more useful for teams — specifically teams across corporations and large enterprise organizations. This morning at its annual Build dev conference,…

Microsoft intros a Copilot for teams

Microsoft’s big focus at this year’s Build conference is generative AI. And to that end, the tech giant announced a series of updates to its platforms for building generative AI-powered…

Microsoft upgrades its AI app-building platforms

The U.K.’s data protection watchdog has closed an almost year-long investigation of Snap’s AI chatbot, My AI — saying it’s satisfied the social media firm has addressed concerns about risks…

UK data protection watchdog ends privacy probe of Snap’s GenAI chatbot, but warns industry

U.S. cell carrier Patriot Mobile experienced a data breach that included subscribers’ personal information, including full names, email addresses, home ZIP codes and account PINs, TechCrunch has learned. Patriot Mobile,…

Conservative cell carrier Patriot Mobile hit by data breach

It’s been three years since Spotify acquired live audio startup Betty Labs, and yet the music streaming service isn’t leveraging the technology to its fullest potential — at least not…

Spotify’s ‘Listening Party’ feature falls short of expectations

Alchemist Accelerator has a new pile of AI-forward companies demoing their wares today, if you care to watch, and the program itself is making some international moves into Tokyo and…

Alchemist’s latest batch puts AI to work as accelerator expands to Tokyo, Doha

“Late Pledge” allows campaign creators to continue collecting money even after the campaign has closed.

Kickstarter now lets you pledge after a campaign closes

Stack AI’s co-founders, Antoni Rosinol and Bernardo Aceituno, were PhD students at MIT wrapping up their degrees in 2022 just as large language models were becoming more mainstream. ChatGPT would…

Stack AI wants to make it easier to build AI-fueled workflows

Pinecone, the vector database startup founded by Edo Liberty, the former head of Amazon’s AI Labs, has long been at the forefront of helping businesses augment large language models (LLMs)…

Pinecone launches its serverless vector database out of preview

Young geothermal energy wells can be like budding prodigies, each brimming with potential to outshine their peers. But like people, most decline with age. In California, for example, the amount…

Special mud helps XGS Energy get more power out of geothermal wells

Featured Article

Sonos finally made some headphones

The market play is clear from the outset: The $449 headphones are firmly targeted at an audience that would otherwise be purchasing the Bose QC Ultra or Apple AirPods Max.

8 hours ago
Sonos finally made some headphones

Adobe says the feature is up to the task, regardless of how complex of a background the object is set against.

Adobe brings Firefly AI-powered Generative Remove to Lightroom

All cars suffer when the mercury drops, but electric vehicles suffer more than most as heaters draw more power and batteries charge more slowly as the liquid electrolyte inside thickens.…

Porsche Ventures invests in battery startup South 8 to boost cold-weather EV performance

Scale AI has raised a $1 billion Series F round from a slew of big-name institutional and corporate investors including Amazon and Meta.

Data-labeling startup Scale AI raises $1B as valuation doubles to $13.8B

The new coalition, Tech Against Scams, will work together to find ways to fight back against the tools used by scammers and to better educate the public against financial scams.

Meta, Match, Coinbase and others team up to fight online fraud and crypto scams

It’s a wrap: European Union lawmakers have given the final approval to set up the bloc’s flagship, risk-based regulations for artificial intelligence.

EU Council gives final nod to set up risk-based regulations for AI