Capital One has struck a deal to buy corporate spend management platform Brex in a $5.15 billion cash and stock deal.
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The agreement, which comes less than a year after Capital One’s $35 billion merger with Discover Financial Services, is made up of 50% cash and 50% stock.
Brex launched in 2017 with a corporate card for venture backed businesses, before expanding to offer SMEs and larger organisations expense management, real-time payments, and AI agent-based workflow automation.
Over 25,000 clients, from startups to enterprises, now run their finances on Brex – including DoorDash, TikTok, Anthropic, Robinhood, Crowdstrike, Zoom, Plaid, Intel, SeatGeek and the Boston Celtics.
However, the purchase price is a steep discount on Brex’s $12.3 billion valuation, secured in a 2021 funding round. Since then, the firm has carried out two major rounds of layoffs.
Richard Fairbank, CEO, Capital One, says: “Brex invented the integrated combination of corporate credit cards, spend management software and banking together in a single platform. 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.”
Brex CEO Pedro Franceschi, who will continue to lead the firm, adds: “Together, we’ll maximize founder mode by combining Brex’s payments expertise and spend management software with Capital One’s massive scale, sophisticated underwriting, and compelling brand to accelerate growth and increase the speed at which we can offer better finance solutions to the millions of businesses in the U.S. mainstream economy.”
The acquisition is slated to close by the middle of the year.
