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Its just interesting to see all these layoffs and cost cutting measures right after they raised a ton of money. In case you are unaware, Brex's business model
by mStreamTeam 6y ago
Its just interesting to see all these layoffs and cost cutting measures right after they raised a ton of money.
In case you are unaware, Brex's business model is to lend money to startups. The kicker is they lend money to startups that banks and investors won't touch. They advertise themselves as a tech company but in reality they are closer to a high risk VC firm.
- Aperocky 6y agoAt this current time that doesn't feel like a sound business model.. but I could be wrong. It also seems that they won't need so many people? The VC firms I know are all capital heavy and very light on staff.
- mStreamTeam 6y agoThey were able to raise money from investors selling themselves as a tech company. Now that they have the money, they dont need the engineers anymore which explains the layoffs and downsizing. Brex feels like an attempt to gamble with someone else's money. They raised a ton of capital and now they are going to use it to invest in high risk startups.
- devmunchies 6y ago> selling themselves as a tech company They built a lot of the underlining infra for their Brex Cash product. > use it to invest in high risk startups Don't they require you to pay back the balance at the end of every month? And you're not aloud to go over a percentage of whats in your bank account. These restrictions limit the risk.
- mStreamTeam 6y agoEvery bank builds their own infrastructure, yet I've never heard a bank advertise themselves as a tech company...
- cercatrova 6y agoCapital One does, to my knowledge.
- CPLX 6y agoIs that actually true? I thought it was the other way around, and they only "lend" money to companies that have millions od dollars in VC investment already in the bank.
- ponker 6y agoNot at all surprising, raising a ton of money usually gets that investor onto your board who probably now wants you to cut unnecessary spending.