I spoke with Larissa Rocha, the first employee at Brex, a fintech company building the smartest corporate card. She shared the Brex founding story, the company’s key growth decisions and long term vision, and advice for startups interested in building diverse teams.
Never view a task as beneath you
It is a very special achievement to be able to truly take a company from point A to point B. Frequently, people join an early or late stage team at the right time, but the true challenge is in adding measurable, growth driving value beyond luck with timing. In scaling companies in this manner, stay humble, be willing to take on any role, and never view a task as too low for you to engage. Become very strong in a few core areas very quickly. To this end, do not limit yourself to the knowledge within the company but look beyond. Develop relationships with people in similar roles at companies in similar stages. However, look beyond startups to industry giants and leaders as well. When building on the service infrastructure at Brex, Larissa closely studied, integrated best practices from, and benchmarked her work and the work of her team to that of Amazon. Be clear on objectives and key results. Brex began implementing more rigorous frameworks around these guarantees and internal communications after its public launch. Quantifying, articulating, and understanding the explicit goals and evaluation metrics of each major task is crucial to effective coordination. Create a culture of open and transparent feedback and ensure it is two-sided. Even managers should ask their teams explicitly for feedback they are afraid to share. Recognizing human tendencies to solely compliment and integrating processes and values that encourage more open discussions significantly accelerate improvement. When evaluating a company to potentially join in the early stage, focus on the founders. Ideally, know them personally, but at the very least, speak extensively with people who do know them well. Ideas can and will change, but the founders stay and make the experience. Think of unconventional ways to reach your goals. When starting Brex, Henrique and Pedro wanted Max Levchin, co-founder of PayPal, to be an early investor. Of course, it was very difficult to get in touch with him through standard channels, so the Brex founders applied to a technical internship program at PayPal where it was rumored that Max would be the final interviewer. When they got to the final stage, they revealed their true goal around Brex and ultimately got Max on board as an investor. Most importantly, always remember that you are just as important as anyone else in the room, on your team, and in the firm. Do not shy away from opportunities because you lose faith in your qualifications. Speak up, push back, raise your hand, and create your seat at the table.
Brex’s Founding Story
Pedro Franceschi was always very interested in computers and was also a scrappy, self-taught person. He began jailbreaking iPhones at age 11, created apps with over 30K downloads by age 12, and soon after, became the first to teach Siri to speak Portuguese. Henrique Dubugras had a strong engineering background and taught himself to code early on as well. When he was younger, to get around parental restrictions on playing online games, he would code a replica version instead. Henrique and Pedro met over Twitter and connected on their strong ability and interest in leveraging technology to create innovative products and solutions. The two then met in person at a hackathon, which eventually led to becoming co-founders of Pagar.me, the Stripe of Brazil (one of the country’s top three payment processors), when they were just high school students. In spite of the success of Pagar.me in Brazil, the team knew they wanted to build something truly global, so they sold the company and started school at Stanford after having deferred their admission for two years. Once at Stanford, Henrique and Pedro began learning more about trends in the startup and tech ecosystems at the university and in the surrounding Bay Area, a hotbed for entrepreneurship. At the time, augmented reality and virtual reality were taking off, so the duo founded Veyond, a startup in the space that was admitted to the Y Combinator Winter 2017 cohort. Although the sector level trends were in place, and of course Henrique and Pedro were brilliant founders, it was not clear to the pair whether they were the best fit to solve a major problem in AR or VR, given their limited background and lack of deep connections to the space. The two would soon realize this and pivot back to fintech. At Y Combinator, they found first-hand that startups had immense difficulty getting access to credit cards, even with the Y Combinator brand, venture money in the bank, and other strong qualifications. Because these early stage companies had no financial history, banks were not able to give them cards unless the founder personally guaranteed. Of course, this was a major burden to founders who could face serious FICO score repercussions. Moreover for international founders, like Henrique and Pedro, the personal guarantee route was not even an option because they had no United States accepted credit score. Inspired by this problem, Henrique and Pedro founded Brex, which began with a new type of underwriting based on cash in the bank (which, for startups, would primarily be funding raised). They created a fintech solution that much better reflected the credit profiles of startups and met the needs of a massive, underserved market. Henrique and Pedro soon found that company cards as a whole was an incredibly antiquated industry in more ways than one. One pain point they chose to focus on was the long onboarding timeline in the card issuance process. At the time, visiting a branch and waiting days or even over a week to get a new card was a common and immensely time-consuming inefficiency. Another pain point the team found was in expense management. With existing platforms, the process was very tedious and prone to errors, requiring the saving of paper receipts and manual data entry. As a result, Brex began creating and offering more integrated, user friendly, virtualized solutions (such as a fast, fully virtualized credit card application process as well as smart reminders and native photo features for receipt submission in expense management) for companies, engaging and adding value to corporations beyond the specific credit card creation point. Similarly, in the early days, the Brex team worked out of Henrique’s home, which was quite a ways away from downtown San Francisco, where most of their meetings took place. In between meetings, they scrambled to find coffee shops with sufficient space and charging stations. Realizing that this was a challenge facing many startups, Brex later opened a startup lounge – named Oval Room for their clients, providing an additional core service to cardholders while also furthering their community efforts. Although much of Brex’s early offerings focused on startups, the team found that e-commerce companies were also interested in Brex as a way to finance short term working capital needs. However, the initial underwriting process and terms Brex created were not suitable for the relatively volatile cash burn of e-commerce companies (as Brex’s underwriting was based on cash in the bank). Thus, Brex created a second product for e-commerce companies, providing access to more tailored rewards and more suitable time periods for payment turnarounds. Brex’s newest vertical target is life sciences, a similarly previously underserved market that has seen significant startup growth in recent years. Brex’s life science card provide industry specific benefits, such as cash back on lab supplies.
Larissa and Brex
Larissa grew up in the northeast of Brazil, and during high school, through a program helping students in Brazil attend colleges in the United States, she met Pedro Franceschi and Henrique Dubugras. Larissa became the first person from her state to go to Harvard, and Pedro and Henrique were admitted to Stanford. During her senior year, Larissa was able to reconnect with Henrique during a trip to Boston. She had been interested in consumer companies throughout college and was at the time, signed with Burger King in their leadership development program. But through her deep conviction in the founders and the mission of the company, Larissa decided to join Brex (at the time names Veyond) as their first employee following her Harvard graduation. Henrique and Pedro, Larissa knew, were founders who would not stop until the world could not remember how it ever worked without Brex. Creating this essential, global brand was something Larissa wanted to drive forward and be a core part of. When Larissa joined Brex in June 2017, the company still had no customers and no broad infrastructure. Consequently, Larissa’s role was, in short, everything. This involved creating, improving, and implementing fundamental procedures across all functions. She began her focus in finance (drawing upon her degree in economics), then regulation, then recruiting for technical talent, then sales, then customer support (a team she soon scaled to 8 people), then agreement structuring, partnerships, marketing, and more. During her time at Brex, Larissa and the team have been intentional about Brex’s role in paving the way and setting an example for their employees, clients, and other companies. The team is passionate about immigrants’ rights (a topic close to the heart of the founding team as Larissa, Henrique, and Pedro all immigrated from Brazil) and exemplifies their active support through their diverse board and leadership composition: 100% of their board and 50% of their senior leadership are comprised of first generation immigrants.