Brex, the $2.6 billion credit card company for startups, explains why it's getting closer to traditional finance with its new Brex Cash bank account product

Brex, the $2.6 billion credit card company for startups, explains why it's getting closer to traditional finance with its new Brex Cash bank account product

Henrique Dubugras Pedro Franceschi


Brex cofounders and co-CEOs Pedro Franceschi (left) and Henrique Dubugras


In Silicon Valley, 2019 may well go down as the year of Brex.

The buzzy credit card startup was everywhere at TechCrunch's annual startup conference Disrupt, with prime placement in the famed Startup Alley exhibition area and three panel apparences on Wednesday. The two-year-old startup plastered San Francisco public transit, billboards, and newsstands around the conference with black and orange sans serif ads coaxing new customers to explore their banking options.

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And on stage Wednesday, Brex cofounder and co-CEO Henrique Dubugras added to the buzz by announcing Brex Cash, the startup's answer to bank accounts.

"We created a lot of goodwill with our customers and a lot of trust, so, you know, I think we earned the right now to launch this product," Dubugras told Business Insider.


With Brex Cash, the ambitious startup is competing directly with the more traditional financial institutions it initially set out to unseat. In the long run, Dubugras said, it's not about Brex becoming a bank in and of itself, but about creating an ecosystem as complete as Apple's - offering its startup customers a complete range of ways to save and spend their money.

"It depends on what you call it bank, right?" Dubugras said. "The biggest advantage of a bank is you get user deposits to lend money. Generally we're not doing that yet, and we have no plans on doing that for awhile. But the ability to send payments, store money, earn yields, we're very interested in doing that for our customers."

Read More: A Harvard grad was the first employee at buzzy credit card startup Brex and says the experience was better than any MBA program she could have taken.

2019 has already been a banner year for the young startup and its 23-year-old founders. In March, it opened a members-only lounge in San Francisco's tony South Park neighborhood among rows of venture capital offices. In June, Kleiner Perkins led a $100 million Series D funding round that valued the company at $2.6 billion. More recently, Brex opened a restaurant in South Park as yet another perk for its growing membership base.

"Instead of building products in which they're just money generators, we're trying to build products that either open the funnel, or products that make the other products better," Dubugras said.


Project Gemini

Brex Cash, codenamed "Project Gemini" internally, functions essentially like a bank account by allowing businesses to store, send, and receive funds from wire or ACH transfers. Customers do not have to be Brex cardholders to sign up, but those that are have instant access to cash sent via wires. Brex Cash also allows ACH transfers, which take several days to process. This tool was built in partnership with Boston's Radius Bank.

Brex Cash accounts are backed by SIPC insurance, a SEC-regulated insurance intended for use by traditional brokers. Dubugras told Business Insider that the startup invests its customers' funds in money market accounts, qualifying the company as a broker and making it eligible for a higher insured limit with SIPC.

"The customers are definitely exposed to some risks by being part of a money market fund, but from the things you can do, your money is the least risky, sorry, I can't say it's the least risky. But you know, it's very low risk," Dubugras said.