Brex co-founders Pedro Franceschi and Henrique Dubugras.<\/p>\n
Brex<\/p>\n
Capital One<\/a> said Thursday that it was acquiring<\/a> payments startup Brex for $5.15 billion, the latest splashy deal undertaken by the bank’s CEO, Richard Fairbank.<\/p>\n The firm, which disclosed the deal in its fourth-quarter earnings statement<\/a>, said the deal is made up of 50% cash and 50% stock. Brex was previously valued<\/a> at $12.3 billion. <\/p>\n Shares of the bank fell about 3%.<\/p>\n Under Fairbank, a rare founder-CEO of a major U.S. bank, Capital One acquired<\/a> rival card firm Discover Financial last year for about $35 billion. That deal was Fairbank’s crowning achievement, giving the credit card lender access to one of the only payment networks of any scale. <\/p>\n “Since our founding, we set out to build a payments company at the frontier of the technology revolution,” Fairbank said in a release<\/a>. “Acquiring Brex accelerates this journey, especially in the business payments marketplace.”<\/p>\n Fairbank said that Brex pioneered the combination of corporate cards, banking and spend management software: “They have taken the rarest of journeys for a fintech, building a vertically integrated platform from the bottom of the tech stack to the top,” he said.<\/p>\n Still, the more than 50% decline in valuation for Brex from its 2023 level shows the headwinds that even successful fintech companies have encountered. <\/p>\n Brex is among a class of fintech firms<\/a> that rose to prominence during a period of low interest rates; it was known initially as a startup that made loans to other startups via its cards.<\/p>\n But the company expanded beyond technology into other sectors and now services larger established firms and startups alike, including Robinhood<\/a>, Zoom<\/a> and Anthropic<\/a>. <\/p>\n Capital One, which has offered business credit cards for decades, became increasingly convinced that it was Brex’s model that would be the winning offering, according to a person with knowledge of the lender’s strategy. <\/p>\n “We didn’t have to pursue this acquisition, our growth was incredibly strong,” Brex CEO Pedro Franceschi told CNBC in an interview.<\/p>\n Combining Brex’s technology with Capital One’s reach and resources would grow the startup’s scale faster than as a standalone firm, he said.<\/p>\n","protected":false},"excerpt":{"rendered":"Brex co-founders Pedro Franceschi and Henrique Dubugras. Brex Capital One said Thursday that it was acquiring payments startup…\n","protected":false},"author":2,"featured_media":423840,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[1532,1531,116,28,122,2200,113,201928,2475,67087],"class_list":["post-423839","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-banks","tag-breaking-news-investing","tag-breaking-news-markets","tag-business","tag-business-news","tag-capital-one-financial-corp","tag-investment-strategy","tag-richard-fairbank","tag-robinhood-markets-inc","tag-zoom-communications-inc"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/423839","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=423839"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/423839\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/423840"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=423839"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=423839"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=423839"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}