05/26/2024 – 8:01
One of James Reggio’s first jobs at Brex, just over three years ago, was to create the Californian corporate expense management fintech app, valued at US$12.3 billion. “One of the first engineers we hired in Brazil joined our group and realized that we were making some choices that were perhaps unfriendly to the user,” says Reggio, who is now the head of engineering (CTO) at Brex. “He then gave a presentation on different applications from fintechs and Brazilian banks – and I clearly remember him showing us how Nubank solved the customer registration and integration process in an easier way than Brex -, what changed our perspective.”
Reggio says that this was just one, of dozens of moments, in which he saw in practice the gain of having different cultures working together – with the Brazilian one having a special flavor in this melting pot. In addition to the company’s founders, Pedro Franceschi and Henrique Dubugras, being born in the country, today Brex has 100 employees, or around 10% of the workforce, in Brazil.
It is such an important share that this week three of the company’s eight senior executives were in the country in a series of meetings with the team, as well as to look for more people to join the staff. “As a fully remote company, it’s important to have these moments to build culture and ensure that messages about the business and where we’re going are consistent,” says Heather Dunn, who leads the people function (CPO) at Brex. “We have different principles about how fast we move, how we operate, what we expect from our managers, the types of objectives and how we achieve them, and this is built in these meetings.”
The “Brex way”, says Reggio, is to have a high degree of individual autonomy to serve the customer, with the famous owner’s mind. “They may seem like just buzzwords, but the goal is to direct the work itself to deliver for both the client and the business, rather than having a very centralized, top-down organizational model,” he says. “We use these moments to spread knowledge and ensure everyone is rowing in the same direction.”
In addition to the bosses visiting the country, periodically all 1,100 employees are taken to meetings in San Francisco. In addition to getting to know the company they work for up close, you can also get closer to your target audience. Although they say that part of the 30 thousand customers are global, they are all based in the USA. This is because Brex began offering solutions – such as expense management, expenses, travel and corporate cards – for emerging companies in Silicon Valley. The reach has increased in the last seven years, especially after the collapse of SVB, Silicon Valey Bank, known as the startup bank, last year.
With rapid expansion and fewer resources for the sector, Brex also had to make cuts and downsize operations. In January alone, 20% of employees were fired. “There was a time when all startups were getting a lot of funding and could try a lot of things,” says Camilla Matias, chief operating officer (COO) at Brex. “But in recent years, all technology companies have started to look for efficiency and the path to profitability.” One of the changes was to reduce hierarchical levels and bring managers closer to the operation – and this movement was part of the executives’ visit to the country.
From now on, she says, the movement is towards executing projects for the company’s growth. In addition to fewer resources in the market, Brex began to face more competition from all sides. “A common thing for startups is to raise funds all over the world, with much of it in the United States”, says Camilla. “So they need to have an account there and the fact that we have more competitors nowadays means that we have proven the existence of a successful business model.”
Flexibility and lower salary
With more challenges, she says, Brazilian flexibility is a differentiator. “Like any company that grows as fast as Brex, you have to change priorities sometimes,” she says. “We are not afraid to try. If it doesn’t work out, that’s okay. Let’s try again next week.” For her, adaptability is a characteristic that is very easy to find in Brazil, more than in other parts of the world. “We learned as children in Brazil to be flexible and positive,” she says. “It’s quite an advantage.”
Brazilians’ lower salary, but still above the market average at Brex, is another attraction. Camilla says that the company benefits from the difference, but invests in the long term, which includes adapting to legal requirements and having a structure of human resources and lawyers in the country, as well as improving employees’ English and even helping with visa and during the visit to meetings in the USA.
“We could have a structure in which only the leader, at the head of a local team, speaks English well, as many larger companies do,” she says. “Development is faster, there is no culture shock, but I think it was one of those intentional decisions that paid huge dividends.”
In addition to bringing the local team closer together, the executives’ visit also meant new hires in the country. In addition to a local people leader, Brex is also looking for data scientists in Brazil. “We started investing very early in machine learning and artificial intelligence,” says Reggio. “One of our key differentiators was the ability to extend lines of credit to businesses that previously could not be assessed, and we used machine learning and AI to do this.” With the advent of new generative models, the idea is to intensify this use.
With the market transformations, Brex lost some positions in the CNBC ranking of the most disruptive companies in the world. After being in second place for two years, it appeared fourth in the list released this month. “We are very happy because we are among the top five disruptors, last year there was a lot of noise around AI (which are ahead of Brex on the list) and many of our competitors are behind us”, says Camilla. “This means we continue to be relevant over time and several of our clients are in the rankings. If they grow, we grow with them. That simple.”
In addition to Brazil, Canada, outside the USA, is the country in which Brex hires the most. According to Reggio, Canadian engineering culture has emerged in the last 10 years. People who got software engineering jobs preferred to work for large banks and companies, but the culture of entrepreneurship and venture capital has emerged in the country, in a very recent phenomenon.
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