Brex’s decision to largely exit the SMB market has caught its customers, market observers and even its competitors by surprise. And while the affected customers scramble to move their assets off Brex’s platform, its rivals are taking aim at the fintech and the market it’s leaving behind.
The decacorn’s decision puts a potentially material customer cohort into play, meaning that Brex’s rivals are likely gearing up to try and attract the accounts left adrift.
TechCrunch heard from a number of Brex rivals on the matter, providing us a feel for how the market views the company’s decision. Naturally, as we’re discussing competitors, they had quite a lot to say about their own products.
So to avoid being overly generous to the competing entities, we have bucketed their observations into two areas: notes on the business model and customer-related points. We’ve tried to only share observations that describe the corporate spend market more generally and not why one particular company is better than any other.
Given how competitive the corporate spend world has proved (more here, here and here from TechCrunch), Brex has kicked off an interesting strategic conversation in this well-funded fintech startup niche. Let’s talk about it.
Kicking the beehive
Interchange incomes usually mean low margins, so their ability to power corporate spend companies has been a point of debate for some time. Brex and Ramp started off by offering free services, while Airbase focused more on selling software. Divvy managed a huge exit on the back of just its cut of card spend fees.