Season 2 Bonus: Henrique Dubugras of Brex

Come on into The Room. The Room is the series that lets you get a view into the room where it happened. If you're a founder facing questions about your first customer, first fundraise, or first hire, this is the show for you. I'm Claudia Laurie.

And I'm Madison McIlwain, your co-hosts.

This week, we are very excited to be airing a special bonus episode for season 2.

Season 3 will be premiering in just a few weeks on May 4th, but we were so excited by today's guest, we couldn't wait much longer to share the conversation. On today's episode, we sit down with Enrique Dubougrasse, co-founder and co-CEO of unicorn fintech startup Brex. If you are a startup founder, read tech news headlines, or even just have noticed billboards all over SF, you are already familiar with Brex and their product, credit cards, banking, and financial products for startups. Brex is undoubtedly a startup institution having raised over $450 million to date, aiming to solve everything banking and money for startups. Impressive as it is that co-founders Enrique and Pedro dropped out of Stanford to start Brex, what's even more impressive is that Enrique and Pedro by then had already had a successful exit for their previous startup, Pagarme, in Brazil, which was processing billions of dollars in transactions in 2016. Today, we dig a little bit deeper into Enrique's life before Brex and touch on themes such as deciding what market you wanna build for, the multi-time co-founder experience, being remote first, and what's next for fintech. Let's open the door.

Thank you so much, Enrique, for sitting down and chatting with us at The Room today.

Thank you so much for having me. Super excited.

So, we are really excited to dig into your story about co-founding Brex, but before we get into that, you are definitely not a first-time entrepreneur and you have started some pretty exciting things before Brex. So, would love to rewind a little bit and start earlier in your career. You grew up in Brazil and found a passion for coding at the age of 12. Tell us about growing up and how your early passions led you to found your first startup.

Sure. I started coding when I was around 12 because there was this game I wanted to play, and in Portuguese, gaming and gambling are the same word. So since I grew up in Brazil, I asked my parents for money to play a game, and they were not going to let me gamble, so they didn't really want to pay for it. And I figured out if I learned how to code, I could play around with private emulators and play it for free. So I decided that I wanted to build my own version of the game and learn how to code through Google. To build this version of the game that instead of paying a monthly fee for it, you could play it for free and buy items inside the game. When I launched it, it got super popular in Brazil 'cause it was free until a few months later I got these legal notifications saying I was breaking some sort of patents. I didn't really know what patents were, but my mom got super upset and told me to shut everything off. At that point, I spent 2 years basically just doing this. So I was lost in life. I was having this 14-year-old life crisis. And I started doing some normal stuff. So, I don't know, I found a girlfriend or started watching TV shows. And I started watching this TV show called Chuck that was a really good computer hacker and programmer. And Chuck, he saved the world through code and he had gone to Stanford and had this awesome life. And I got obsessed with him and I wanted to be exactly like him. And I decided that the first path to do that was going to Stanford because Chuck went to Stanford. So, I got obsessed with going to Stanford. But for Brazilians, the whole US application process is quite complicated. There's a lot of stuff that needs SATs and essays, et cetera. I didn't really know how it worked. So we found this guy on Facebook that was graduating from Stanford and he was Brazilian. And I added him on Facebook and we started chatting and it turns out he was starting a startup, a ticketing startup in Brazil. And I thought it was super cool. So we talked a lot and we made this deal in which I would code for him for free in exchange he would teach me the Stanford application process. And he would write me a recommendation letter. So that's how I got into startups. I just worked for this guy for a year and he had the most awesome life. He was building a company and hiring, having meetings and pitching to investors. And I thought that all sounded super cool. So after working for him for a year, I decided I want to try to start my own company. So I left and tried to start this education company that helps Brazilians with the whole US application process, explaining and letting them practice for the SATs, similar to what I had just learned from this guy. So I started with two friends, this, this education company that failed. We got a bunch of users, No one wanted to pay for anything, but got me into trying my first startup, which was incredibly valuable. And around that time, I was having a lot of disagreements with my mom, so I had to get emancipated. I moved out of my house, started supporting myself. It was pretty dramatic, but it worked out well in the end because I was running out of money and there was this hackathon in Miami that was worth $50,000. And I was, oh wow, if I can win this thing, it's more time without going back to my mom. And we went to Miami and built this app that was called Ask Me Out, which was Tinder, but instead of geolocation, it's Facebook friends. You could match Facebook friends. And that, we won the hackathon, which is awesome, but we tried to launch it as a business and it didn't really work again. But that's how I got into payments because I tried to implement a payment system for this app and it was a horrible experience. And around that time, I met my co-founder Pedro because Pedro, he started coding when he was 9 years old. And when he was 12, he got very hacker famous because he was the first person to found the jailbreak for the iPhone 3G in the world. And these things usually come out of China or Russia or the US for some security guy and like came out of this 12-year-old in Brazil. And so everyone was writing about it and it was crazy. So he was an impressive— Pedro got hired by Brazil's largest payments company, Cielo, because he was the only one that knew about iOS security in Brazil because no one understood anything about security and they were having, they were building their app and, you know, when it needed to be secure, a payments app. So he got into payments and then We met in the end of 2012, basically over Twitter, fighting text editors. So when you're a programmer, you have something that's very religious to you, which is your text editor. And I was one called Vim, he was one called Emacs, and we started fighting about it and it got too complicated to fight over 140 characters. And so we went to Skype. And on Skype, we became best friends and decided to start our first paid business together. That was Pagarmen, which was Stripe of Brazil. So it was online payment processing. and that was the first startup that worked. We started, uh, basically processing payments and we grew from the two of us. We were able to raise $300,000, which seemed like an infinite amount of money at the time, to a little bit over 150 people, a billion and a half in transaction volume, pretty profitable until in September 2016, both of us had gotten into Stanford. So we decided to sell the company and move to the US, and that's when we started Brex.

Well, I think what's really cool is that even at such a young age, you had gone through so many iterations before finding the startup that you became known for. And I think that's something that isn't necessarily acknowledged and seen by a lot of aspiring entrepreneurs. Oftentimes it just seems, okay, you've tried it once and you made it big, but it's awesome to see that there were a lot of different tries at it, but sort of that passion to build was always with you. You mentioned that you sold Pagarme for— in 2016. Tell us a little bit more about that decision to sell your startup and move to the States. I can imagine that it felt— you guys were growing really quickly. It's not obvious to sell sometimes. So could you walk us through what that decision pathway looks like?

People call us serial entrepreneurs, but it wasn't really by choice. We always liked this idea of working on something for 30 years, and that's always what we wanted to do. We never wanted to start a company, sell a company, and fail. We just wanted to work on one thing for a very, very long time. And when we were doing Pagarme, there was no Brazilian unicorns at the time. Now you have Nubank and Stone and XP and PagSeguro, all these amazing companies that are worth $20 billion each, but at the time there was not. So it didn't really seem at the time that you could build a really massive business from Brazil. So if we were going to work on something for 30+ years, we wanted it to be something that could be really big and really massive. So that was number one decision to sell. Number two was we both got into Stanford, which was really— it sucked because only one of us got in, and it was my dream since I was 14. I wanted to check it out. I wanted to see what Chuck experienced. I just wanted to go through that experience in my life, and I felt that if I didn't go through it at least a little bit, I would regret it in the future. And the third thing is, look, we were 20 and broke, so it's awesome to have your life change financially for the rest of your life. So I think the combination of those three things, we decided to sell, but it wasn't an easy decision. The company was growing, it was profitable, it was doing super well. And even today, if you look at— if not the largest, one of the largest online payment processors in Brazil to this day, so we would've done super well. Had we stayed, but I think the combination of those three things made us sell. But we're— Brex, on the other hand, we're never gonna sell.

So in regards to Stanford, it was what, 2016? You, you were able to sell Pegarme and go and move to follow your dream of going to Stanford, just like Jack. But you weren't at Stanford for very long. You actually ended up dropping out. Maybe talk us through what those years at Stanford were like, and then ultimately what prompted you and Pedro to, to leave.

Yeah. So look, it wasn't as fun as we were expecting in our heads. I think I had forgot what was having homework and stuff. And it was a kind of a hard adaptation because when you're running a company, it seems like you're building the future, right? There's something in the world that doesn't exist and you're on the edge of what's being built, right? And you're that. And then when you're at school, you're studying the past, which is, it's interesting, but it's just a completely different feeling. And I think when we got to Stanford for the first 3 months, we were on vacation basically. We've been working so hard for 2 and a half years. Let's have a break, relax, enjoy college. But then after 2 months, we started getting itchy again. Fuck, all these people building the future and we're here studying the past. But we never wanted to do fintech again. We were tired of fintech. We were like, okay, we're in Silicon Valley. We want to be Bill Gates and Steve Jobs and we want to build the future with something at the edge of technology. And so we tried to start a VR company. That was our first idea before Brex. I can tell you how we pivoted back to Brex, but That's the vibe we, we were in.

You and Pedro have been through a lot together. I think it's incredibly rare by 23 that you and your co-founder have started multiple businesses together. Tell us a little bit more about how your relationship with Pedro has sort of developed over these years and also who else was with you as you and Pedro were starting to realize that you wanted to leave Stanford and start Brex.

The relationship that we have, it's basically a safety net for us that gives us a huge amount of confidence because what we thought in the end through Pagar.me, through Brex, is if everything goes poorly and everything goes to shit, we'll just gather back in our rooms and figure something else out. And this feeling of camaraderie of us against the world, that no matter what happens, we're together and we're figuring something out and everything's gonna be okay. And I think that that just gives a huge amount of confidence to take a lot of risk. I think we're extremely complementary in skill sets and personalities. We joke that I can't sleep. I have trouble and anxiety sleeping when something's really good about to happen. We're raising a round or we're about to launch a product or close a big customer and I can't sleep. I stay up all night thinking about how cool it's going to be. Pedro, on the other hand, he sleeps like a baby when things good are happening, but when there's a problem, can't sleep. He's figuring it out. His stomach is going bad. He's like, "How are we going to solve this problem?" I sleep like a baby. I'm like, "Okay, problems, we'll figure that out tomorrow." And we're very complementary in skill sets. What I— the things that I'm doing are almost the exact same things that he hates doing. The things that I hate doing is almost the exact same things that he likes doing. So we— there's very little split of responsibility. There's also no ego. For me, me making money or him making money or me having credit or him having credit, for me is the same thing. Literally, I don't want to have a dollar more than him and I don't want to have an inch more of credit than Pedro does. And I think that's vice versa as well. So it's super symbiotic and we live together, me and my girlfriend, my dog and Pedro. So we're super close.

That's awesome. I'm also— I don't know if we even discussed this, but over the past 6 months, me and my significant other have co-founded a startup together and going through that early journey. And it's, I mean, obviously a different relationship, but it's awesome to see how important it is to have that person that is just your pair that you trust so deeply. I think it's really rare to find. So proof is definitely in the pudding with Brax. So you decide to start Brex, you drop out of Stanford, and Brex is notably in the 2017 YC batch. Tell us how going through the YC experience differed from starting your first startup and really what your takeaways were from going through YC.

Yeah, honestly, YC was— it's very hard to imagine Brex existing without YC. We're deeply grateful to YC and for many reasons. So The first one is, you know, in a really positive way, we were there and we had a startup and every week we went to this group partner meeting, which are this group batch meeting in which all of our peers were there. And every week they had progress and we didn't. And it felt really bad but really motivating at the same time. Oh, we want to have progress too. All these people are having progress. We're not having progress. And it forced us to, you know, pivot out of what we were doing because we figured out we didn't know what we were doing. And it also created in a very positive way, a competitive dynamic, but not in a way that I want them to fail and I want me to succeed. It's more, oh, all these other people are succeeding. I want to be part of that crew too. So I think it gives you a rhythm of wanting to do something, which is important, right? I think the second thing is whenever we wanted to pivot out of Brex, it was just such a playground to test ideas. It's so easy to talk to so many companies that have done this idea before and failed, or the ones that succeeded, or would you buy this product? How would you think about this? It's just in theory, you can do this without YC, but it's just so much easier in YC that you can into it with so many more people that are all in the same boat. And I also think it helped a lot with fundraising. Being at YC, even though we were pretty well connected and we knew a lot of investors, I think it just made it super easy. And fundraising was very important for Brex, right? As a fintech business, we were initially more capital intensive than most startups. So doing well in fundraising was super important. So it was a, it's a pretty positive, very, very positive experience. Think super highly of YC.

That's wonderful to hear. I think what I heard you say a little bit in that was the company you applied to YC with was not Brex. Do I have that correct?

Correct.

So that was the VR company you applied for VR and then exited with a fintech startup.

Is that correct?

Yeah. And what happened there was we were 2, 3 weeks into YC and I was saying everyone had progress and we, we're moving nowhere fast. And I think we got this advice, which is you should build something that you have, you as a founder, you have this unique perspective on how to build and not something that any other smart kid from Stanford started to do it, why is you going to win versus them? And VR, we didn't really have an answer to that. Actually, we're going to lose most likely because we have no idea what we're doing. But fintech is something that we knew a lot about, so it was easier for us to keep executing on. And we were super worried because we're like, oh shit, probably we're going to have to give the money back. YC funded this VR thing. We have no idea to go for. And we talked to them. Yeah, I just figured something out. I think it's a great idea. Just go figure something else out.

So you walk into Demo Day with an entirely new business model and quite frankly sector than you walked in. Who was the first person that raised their hand to invest?

So funny enough, we didn't do Demo Day actually. During the batch, we decided that we already had a pretty good network of investors, so we decided to just go to our network and we did the opposite strategy in which we basically went to investors and said, hey, you don't want me to go on Demo Day, so give me a term sheet before Demo Day. And we'll, we'll do that with you. The first, first investor that committed was this small fund called Human Capital that I met through Stanford, and they were probably the first, first investor. But probably the more well-known one that first committed was Max Levchin. Really, really helped us with understanding the landscape and doing— because he was doing a fintech business himself, obviously having found PayPal before. And then the first fund that committed was Ribbit Capital, which is Micky, which at the time he was very well known, but I think today he's a god of fintech.

So you have these incredible storied individuals and now firms that helped you raise this first round coming out of YC using the tried and true FOMO tactic, uh, to make sure you pulled that round together before Demo Day. But today, what, 3 years later, almost 4 now, you've raised $731 million in venture funding, which is incredible at a very, very high valuation. Maybe walk us through some of your tips and tricks for those processes, either on the first fundraise or the later growth ones for our first-time founders who listen into the room.

I can probably talk about this for a long time, so you're going to have to cut me off. But I think that a lot of people have different opinions on this, on how to do this, and my opinions usually sometimes contradict other founders' opinions. So Take everything I said with a grain of salt of what worked for us. Maybe it's not what worked for other people, but I think that the probably the top 3 things I would remember as a founder is number 1 is the reasons that investors tell you no are very— the opposite of that is not what gets you a yes. A lot of times I meet founders and they try to fundraise and investors said, oh, you need a little bit more proof here, a little bit more proof there, revenue here, metrics there. And they try to, okay, let me focus on doing that. So we optimize to not get a no. And usually the reason investors give you the no are not necessarily what would give them a yes if that weren't true. It's just a lot of times what they're justifying to you because they want to keep optionality to invest later, so they're just telling you something that's more factual and doesn't offend you or anything like that. But the reason most investors say no, and the same reason the investor says yes, is like, hey, Is this team gonna execute on this big market? And is the vision good? Right? So usually it's one of the three things. Either they don't think the founding team is good, or they don't think the market is good, or they don't think that the vision and the way you're executing is good. So I would spend more time in the pitch try and crafting those three stories. What is your founding story and why are you particularly suited to build this company? Right? And then number 2 is, hey, why is this market a super interesting market that's ripe for disruption? And what is your long-term vision? Right? How are you gonna go from this small thing that you started out that's probably a niche thing to this big, massive vision? What are the steps in between? And I think that most pitch decks and most pitches should focus on that. And most of the times I see most founders starting of, hey, we grew ARR from this to that, or we grew users from this to that. Those are just a point in time numbers. Those are going to change dramatically based on how big the market is or how you're executing, what your, your team is. So I think that's probably my biggest advice is focus on those 3 things and don't get super obsessed about the metrics and the reasons investors tell you and things like that.

As the investor in the room, I think that that's really wise advice. And especially at the time in which you were founding Brex, it was pre-product, really pre-revenue. People were betting on you and Pedro, and obviously that was a really good bet to make. So taking a step back, maybe walk our listeners through what the thesis was for Brex, what you got started on building.

Yeah. So the thesis for Brex since early on was, hey, we want to build B2B banking. That was the first thesis. But it thought about starting a banking product, but it didn't seem founders would give their money to these random Brazilians that showed up. So we looked at Nubank in Brazil and they were starting credit cards. We thought that's smart. And then we talked to YC founders and YC was like, hey, founders need credit cards. We're like, okay, that's a good idea to start with. But we always had a much larger vision than credit cards for startups. We wanted to build, you know, this massive B2B banking and it evolved from there. But I think that was early. And the thing that we— the first initial product idea was, hey, founders raise $5 million, they can't get a credit card. Let's do that. And the need was so acute that before we launched, between we having our first transaction launching, we probably had a couple hundred customers and some of them were using command line interfaces too. Didn't even have a dashboard, but they couldn't get a card. So it was better than nothing. And I think that's probably when we knew that the product was probably gonna work because people were using it and we were making money even before we had a dashboard.

Yep. So you're referring to this launch of your corporate credit card and rewards program designed for startups, which officially launched in June of 2018. And I, I actually moved to San Francisco in 2018 and I remember seeing Brex ads all over the city. You could not walk past a BART stop and not C of Brex ad. It was quite iconic, honestly. And I think the, the core behind what you were doing was reimagining every aspect of a corporate card. And you just alluded to some of those features, but things including 10 to 20x higher limits than traditional cards, which was really tailored to the needs of a startup. And then there was no personal guarantee for founders. Obviously, that's a huge risk, uh, reason why they would maybe not get a corporate card. So walk us through some of those early conversations, why that was so radical.

On the product side, it was just for us, it just seemed such an obvious thing at the time that this is how it should work and it didn't. It just seemed like, hey, you have $5 million in cash, you should be able to have a $500,000 limit. There's no reason why that shouldn't be true. And we know, we understood why that wasn't true, but shouldn't be in the future. And honestly, we're changing that. A lot of, you know, people after Brex are now doing similar things. So I think that's definitely there. And I think the early conversations were, hey, this should be true. Let's just build it and market it. And I think on the marketing side, the important thing was we just wanted to have a really clear message. There was no way to be misunderstood of who is this for and what do we do. Brex, a credit card for startups. That was in every billboard around the city and every parking around the city. We just found that most startup founders come to SF eventually for pitching. Founders of VCs. So when they came, they're going to see Brett. And it was easier for us to target customers out than it was through Facebook and Google, because how do you target startup founders on Facebook and Google? It's really hard. But turns out they're all in San Francisco and coming to pitch VCs even if they don't live here. So that was easy to target. I honestly want— I could take credit and say, hey, this was my genius, brilliant idea, but it wasn't. It was our head of sales, came and he was like, "Hey, we did this at my other startup and it worked. Maybe we should try it here." And then we went to the vendor and buying one billboard was $30,000, but if you bought all of them was $300,000. So we're like, "Okay, so that's some economies of scale right there." So we're like, "Yeah, why not? We had just raised a bunch of money.

Well, let's give it a try." As, you know, a startup founder myself, not only am I a Brex customer, but a few of my friends who are in the ecosystem, I remember when I just started raising, one of my friends, she was like, "Oh, do you have a Brex card yet?" And I was like, "Not yet." And she goes, "Well, basically that's that's the startup world's American Express Black Card. Once you have a Brex card, everyone knows that you've started to make it in the ecosystem. So I sort of— today it's clear that you have incredibly strong brand recognition with the entire startup community. But at the beginning, the B2B sales process, I'm sure, wasn't the smoothest journey. Tell us about how you sort of started to acquire your customers. Walk us through a moment in which you sort of acquired your first big customer and realized that things were going to change?

It's interesting that one of the things that we did early on, Rex, was sell to startups versus no one else was selling to startups. So if you look at American Express, startups and small businesses are the same thing. They basically are just a cohort of companies that are below X in revenue. So American Express didn't treat startups as a separate thing. So there were no, no one selling to them. And one of the early things that we did is just sold to them because the economics supported it because they grow so much and they eventually spend so much that the LTV is super high. And I think that really helped. I think a lot of founders are obsessed about making everything self-service from day one. Our thing wasn't self-service at all from day one. We had a salesperson talking to every customer for a long time, and that helped because we got a huge amount of market share really, really quickly. So I think that's some, some of the things that were probably, if you want to say, okay, why Brex worked early on, this is probably one of the main reasons is we were willing to sell to a customer that no competitor was selling to. You weren't getting a lot of emails about corporate cards back then. And we were one of the first ones to just outbound and call and do like all kinds of sales strategies. And we were lucky that we hired our first sales leader really early on before launch. We hired Sam, our sales leader, still sales leader till today. he was the head of sales at Zenefits before. They were really good at selling and we just employed a lot of the same tactics on the sales side that were pretty aggressive and we just got a lot of customers really, really quickly versus I see a lot of founders that don't want sales and they don't want to touch and they want humans, they want all inbound, all super self-service and organic and really don't care. We just want customers. We're just going to go after them.

So last September you mentioned that moving forward Brex will be permanently remote first with the vision to build a business that doesn't constrain top talent to only a few key cities. And being Brazilian yourself, I'm sure it felt weird coming into Silicon Valley and realizing, okay, now everyone has to move here and everything's incredibly expensive. What about these 20 people from a completely separate city that I want to hire and be a part of my team? Can you tell us a little bit more about that vision and also what it was like coming from Brazil and establishing yourself in the ecosystem in Silicon Valley?

Yeah, I think a few things. So one, I'll start by this question by telling you the story of our first engineer, both at Brex and ProgramMed. So there's this kid Jonathan, and Jonathan, it's his birthday actually today, so I'm going to give him a call later. And his story is, when I was 13 years old, I was in these forums programming, and I was there and I needed to do something really complex, which is converting something from one programming language to another programming language. And I wanted to use this thing called regular expressions, which is glorified Search and Replace. And then it was these forums and this person, which is an avatar at the time called GreenBox, I didn't really know who it was in person, responded saying, "Hey, you should do a transpiler." And I was like, "What the hell is a transpiler?" I had no clue. And I'm like, "Okay, whatever you do, you do the thing. If it works, it works." And then he did it and it worked perfectly, this super complex thing. And I'm, "Wow, this is amazing. This is great. Who are you?" He's, "Yeah, my name is Jonathan. I live in Goiás, which is a state of Brazil." "how old are you?" And he's like, "I'm 11." I'm like, "No way. There's absolutely no way." "How? What do you mean? I'm 13. I think I'm awesome. I code." "There's no way you build a transpiler when you're 11." He's like, "I am." I was like, "Show your webcam. Turn on your webcam. Let me see." This was MSN at the time. And he's like, "I don't have a webcam, man. I'm sorry." I'm like, "I don't believe you." So I stopped talking to him because I don't want to be around liars on the internet that lie their age for years. And then a few years later, we were starting ProgramAid, and Peter asked me, "We need to hire engineers. Who are some of the best engineers you worked with?" And I was like, "Well, there's this guy, Jonathan. He's probably around 30, but he's a meth addict. He lied about his age. So maybe we reach out." So I reach out to Jonathan and, "Hey man, what's up?" He's like, "What's up? Blah, blah, blah. How old are you now?" "I'm 14." "Turn on your webcam." Turned on. He's like, "Oh, wow. So you really were 14?" I was 11 at the time. He's like, "Yeah, I told you, man. I don't know why you stopped talking to me." And then, "Wow, that's amazing. So can you come work for us?" He's like, "Sure, but I'm in school, in high school. So what do we do?" I was like, "Oh, we'll figure it out." So we talked to his dad, convinced him to move to São Paulo. We put him up in a school that he didn't have to do that much work in. Paid for his apartment. He was just this amazing, amazing engineer that built a lot of our early systems, till this day are running and processing billions and billions. And then when we came to the US, he moved to Brex as well, was one of our early engineers, and till this day builds some of our most complex systems. We've been working together now for 7, 8 years, and he was from the middle of nowhere in Goiás. We would never have had an office there, ever. And I think that illustrates a little bit our decision to go remote, which is how many more Jonathans are in the world that don't have the opportunity but are incredibly, incredibly smart. Right. I do think still post-pandemic, pre-pandemic, San Francisco and the Bay Area will probably be the highest concentration of talent in the world, but it won't be better than everywhere else combined.

What's your take on the future of work?

I think that big companies are going to be built either way— remote, in-person, hybrid. Each of them will come with a set of pros and cons and is for each business, there is a set of pros and cons that make more sense for that business, right? So for us, hiring engineering globally and other things globally is incredibly impactful to our business. Maybe for a bank located in Arkansas, it's not that impactful. And having everyone in one place, having that culture being built in person, and that it's more important to them. And maybe if you're working in extremely hard problems, you don't, the John Does of the world don't really matter because you want someone who's a PhD in AI and you're working on incredibly hard problems and having that in one place and everyone working side to side, it's more impactful. I think it will be very different across many companies and each company will kind of pick their own flavor.

Yeah. And I think that's a good way to think about a lot of just advice, not even just remote or not, but I think as a startup, you have to identify where your unique needs are and not necessarily just copy what other, what has worked for other people. And I think that's very much the case for whether you're remote first or not post-pandemic.

What I'm sensing from this call is that you have created an incredibly open culture, which absolutely supports what Brex is going after, which is opening up credit and opportunity and access to founders of all shapes and sizes who are looking to grow their business. And it's easy to think now with a I'm hearing potentially $8 billion valuation round coming together. No need to comment. No need to comment. In the coming, uh, year to come, there's just so much ahead for Brex. But I would love to ask, cuz it's not always up and to the right when we're building these companies, um, especially in fintech. Oftentimes there's a lot of fraud involved and fraud risk. Maybe if you could walk us through a moment of, oh shit, we have a fraud problem, or we are concerned about this breaking and not scaling as you were on this building journey.

Yeah, we had fraud along the way, but I wouldn't say for, for us it was a little bit easier than for most because we relied on companies that had investment before. So if you raise money from Sequoia or Ribbit or YC, it's pretty rare that it's a complete fraud. I wouldn't say it's impossible because we had it, but I think it's different than if you're serving anyone who comes along and fraudsters target you and think As Brex is now opening up to more sectors, it'll start becoming more of a thing, but I think for the longest time, we were just insulated in the Silicon Valley bubble. But I would say that there was one moment that was a little bit, oh shit, which early on, we were— I won't mention names here even though I want to, but early on, we were getting a debt line of a bank that it was all set, and then the day of closing, they backed out. And we were counting on that. We were going to run out of money in a few months if we didn't have it. And we said no to everyone else because they had the best offer. And I remember that our CFO, Michael, who was incredible by the way, and he was just losing his hair and we had to put something together. And thank God we got a partner, which was Credit Suisse, that saved us at the time. And we're very grateful to them for that. But that was probably a big oh shit moment for us.

Brex is no longer just a credit card, but provides a cash account, instant pay for Shopify merchants. And given that Brex has applied for a banking license as reported last month, Brex is clearly expanding upon its existing suite of financial products. Tell us what's next for Brex.

Yes, there's a lot of interesting things to come, but I think that the way I would think about it is we are launching more software products. So today You use Brex for your banking or your credit cards, but I think the vision for us in the future is how do we add more software to it? How do you build a lot of your financial processes on top of Brex? So for example, we launched a few expense management features a few months ago, and I think there's a lot of more interesting things to come there.

That's awesome. I am excited to see where Brex can go from here because it just feels there's a lot of opportunity for you to expand into where your customers trust you today and where you can continue to deliver for them in the future. So we'll look forward to keeping up and following on the Brex journey as well. But Enrique, we'd love to know what's next for you.

I think for me, what's the next step is on a personal side, remote opened up a whole different world, right? I, before I, I thought I was gonna live in San Francisco for the rest of my life, and now I live in LA. And actually working from home a lot, so I think I'm trying to figure it out. Now that we're going to be remote first forever, how do I want my life in a way that's truly productive and I can work really hard, but at the same time fulfilling? Because I think one of the things that it's important for, especially growth stage founders, I think for the early years of startup, you can just grind to get to a point where you have escape velocity, and that's probably the right thing. But after you hit that and even though you're a growth stage, the super important thing is how do you do this for the next 10 to 20 years? How do you make your job a job that if someone asks you, "Hey Enrique, would you take a sabbatical ever?" The answer is no way. I love what I'm doing and I have no interest in a sabbatical. And I think that that's what makes companies great for a long time is when founders just have the same level of energy they had in the first years over 10, 20 years And I think you can only do that if you, if you're happy and you adapt your life to be happy. And I don't think that that means work and life balance per se, because I love my work, so I just do whatever I want. But it means how do you create a life and a work that you enjoy so much doing that it doesn't even feel like work? You can be highly productive and happy.

Claudia and I were just talking about this. We spent the weekend in Tahoe together with our boyfriends and a couple other friends, and it just felt a really great marriage of work time and quality time and, and finding the people really at the end of the day who make all that work worth it. And it sounds you already have some great people in your life with Pedro and living with your girlfriend and, and this coworking space. It sounds you guys have built for yourself in LA. But our, as we come to the end of our conversation, this is actually something we love to touch on for all of our guests, but is really, you have this amazing group of people surrounding you who've probably helped you professionally and personally in ways you can't even quantify, but who is a woman in the, in your life that has had a profound impact on you in the professional sense?

Anu, our board member from YC. She let our series be, and I think before working with her, honestly, we weren't in the early days of Brex, right? Coming from Brazil, we didn't even know that diversity was something important. Brazil is not even something people talked about, and we got here And I think that there was a point in Brexton which we had 30 guys and 1 girl on the team, maybe 2, which was obviously not a great place to be. Today we're much, much better. And I think that Anu was probably the first super senior woman that joined our board, first alerted me of how important diversity is, but also set the example. Wow, what does a great look like? She is so amazing and smart and hardworking. And had such a different set of ideas that made us care so much more in a deep way and not just for the numbers. So she's truly fantastic and I do a bunch of references for her and I tell her she, she's one of a kind.

That's incredible. I'm glad that you have people like that around the table with you and in the room. So with that, Enrique, thank you so much for taking the time to chat with us today. We've really enjoyed the conversation and hearing about all that has happened and all that is to come. For you and the Brex team.

Thank you so much. Love being here. All opinions expressed by Claudia Madison and podcast guests are solely their own opinions and do not reflect the opinion of The5EC. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.