Brex Expands Corporate Card Business to EU, Makes Plans for UK
Corporate card company Brex is reportedly expanding in Europe as it prepares to go public.
The company obtained a license that lets it serve businesses in Europe and plans to roll out its offering there and in the United Kingdom, the Financial Times reported Thursday (Sept. 4).
CEO Pedro Franceschi said in the report that the expansion gives Brex access to a market worth up to as much as $5 billion per year in added revenue.
“Business in Europe didn’t really have a good solution before; it was Barclays in some areas, but not really a modern solution,” Franceschi said, per the report.
Brex, which offers corporate cards and expense management to companies that include Arm, Wiz and Anthropic, hopes to compete with players that dominate the multitrillion-dollar corporate card market, such as American Express, according to the report.
It also competes with Ramp, which became a $22.5 billion company in July following a $500 million funding round.
Brex was one of the fastest-growing FinTech startups during the venture capital boom, valued at $2.3 billion in 2022, the report said. The company saw its momentum flag when higher interest rates began to crimp startup funding.
Brex has been involved in an aggressive turnaround effort in the last two years, described by one investor as “a torturous journey” that involved “repositioning the company, firing a bunch of people, getting people back in the office and shedding the excess from 2020/2021,” per the report.
Now, the company is on the verge of making more than it spends for the first time, according to the report.
“It’s going to happen in the next two quarters, at this point it’s sort of inevitable,” Franceschi said, per the report.
In January, Brex secured a $235 million credit facility provided by senior lender Citi and participating lender TPG Angelo Gordon.
Corporate credit cards stand out as the preferred choice for 52% of small- to medium-sized businesses (SMBs) that are seeking alternative financing, according to the PYMNTS Intelligence report “One-Quarter of SMBs Plan to Increase Corporate Card Usage This Year.”
Nearly 92% of the surveyed businesses said they went with corporate cards as a working capital tool because of the ability to cover predictable expenses, while nearly 80% mentioned using business cards to address unexpected expenses.
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