Inside Brex’s efforts to burn much less money

Welcome to Information World Fintech (previously The Interchange)! On this version, I’m going to take a look at Brex’s newest spherical of layoffs, the state of fintech investing in 2023 and extra! I could also be taking a while off in coming weeks however by no means concern, Information World Fintech isn’t going away. We’ll be again quickly!

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The massive story

What goes up should come down. For spend administration startup Brex, this was the case for its worker headcount. Whereas rates of interest had been low, the corporate noticed a bump in enterprise and VC cash was simpler to come back by. Its headcount had swelled to about 1,300 earlier than it laid off workers in October of 2022. As issues have come all the way down to earth, Brex is making an attempt a reset, saying this week it reduce 282 workers, or almost 20% of its workers, in a restructuring. The transfer got here after experiences the corporate burned $17 million in money every month throughout the fourth quarter and that it’s making an attempt to protect runway.

Evaluation of the week

Fintech, oh, fintech. Final 12 months wasn’t straightforward on you. Fintech buyers injected $34.6 billion in startups throughout 2,055 offers in 2023, a –43.8% and –32.4% YoY drop, respectively, in response to PitchBook data. Valuations additionally principally dropped, with the median of $19.4 million, down –13% from 2022’s median. Exits additionally took a dive, with simply $5.9 billion in exit worth generated throughout 185 offers in 2023, a lower of –76.1% and –22.3% YoY, respectively. However This fall was a very good one. In response to CB Insights, fintech noticed eight new unicorns throughout the interval and fairness funding improve by double-digit percentages.

{Dollars} and cents

Bilt Rewards, whose platform goals to permit customers to earn rewards on hire and day by day neighborhood spend, introduced final week that it raised $200 million at a $3.1 billion valuation. Common Catalyst led the financing, which greater than doubled the New York–based mostly firm’s valuation in comparison with its $150 million October 2022 elevate. The elevate and valuation leap are spectacular in an setting had been mega-rounds (offers value over $100 million) are few and much between. CB Insights’ State of Venture Report 2023 discovered that whereas mega-rounds “had been a trademark of 2021, with 350+ occurring every quarter . . . in This fall’23, that determine fell to simply 78 — the bottom stage since 2017.”

What else we’re writing

Swedish fintech firm Klarna introduced its first subscription plan, “Klarna Plus,” for $7.99 per thirty days, that includes advantages like no added service charges when utilizing Klarna’s One Time Card, double rewards factors and entry to unique reductions with well-liked manufacturers.

A new list compiled by GGV US highlights 50 fintech startups enterprise capitalists assume are scorching stuff. We additionally spoke to GGV managing associate Hans Tung about what he’s seeing within the sector at present.

PayPal will start piloting a couple of new upcoming updates to its service, a few of which is able to leverage AI-driven personalization. The corporate is introducing a brand new “CashPass” cash-back providing known as “Good Receipts,” with personalised suggestions, amongst different issues.

Different high-interest headlines

Rainbow raises $12 million

Sequence raises $5.5M in funding

Sunbit Secures US$310m Debt Warehouse Facility led by Citi

Investing platform Public launches options trading—and pays customers for their orders

FinZi, the Colombian fintech company, has been acquired by Girasol Payment Solution

BillingPlatform lands $90m growth equity investment from FTV Capital

Fintech predictions from Plaid’s CEO

Observe me on X @bayareawriter for breaking fintech information, posts about espresso and extra.

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