When Brex, the B2B financial service, launched its e-commerce corporate card in February, it expected its offer of 60-day credit to attract mostly early-stage businesses. However, the interest-free credit limit also comes with advanced fraud protection and a suite of rewards tailored to e-commerce brands — and this has brought in a new market.
“It’s actually some of these more established companies — that do somewhere between $100,000 and $1 million in sales a month — that are more interested,” said Michael Tannenbaum, CEO of Brex. “They’re at the stage where they can be a little bit more sophisticated about their finances and saving money on interest rates, being more flexible on shipping.”
Since February, Brex has added footwear brands like Greats, Tamara Mellon and Paul Evans NY to its roster of customers. The finance company attributes part of this success to the addition of a rewards program, which offers curated discounts for services that its customers are most likely to need. For example, e-commerce customers receive four months of free use at Shippo, an online shipping platform, and a two-month free subscription to e-commerce operations software Stitch Labs.
Brex also became the first company to partner with Clear Channel Outdoor on a rewards program, offering customers 10% off outdoor advertising; a popular tool for users looking to gain more traction in the marketplace. Through these kinds of benefits, Brex is hoping to strengthen its appeal to brands that may not be actively looking for the tailored financial service it provides — because they might not yet know it exists.
“This concept of a credit card that’s tailored to e-commerce is new, so we have to do some market education about that,” said Tannenbaum. “Having rewards is a big part of the value proposition of Brex to e-commerce; if you’re just a regular small business, like a bakery, you’re not going to have much interest in anti-fraud e-commerce software.”
However, the unexpected success of the product with a higher-revenue market has caused some growing pains. Currently, Brex is able to offer a credit limit of up to $5 million, but this isn’t always sufficient for larger companies. Therefore, the service’s next priority is to look for ways to bypass the restrictions of the card networks (Brex uses Mastercard) and offer additional solutions to its customers.
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