Inside Brex's efforts to burn much less money

Welcome to TechCrunch 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 worry, TechCrunch 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 return by. Its headcount had swelled to about 1,300 earlier than it laid off employees in October of 2022. As issues have come right down to earth, Brex is trying a reset, saying this week it lower 282 workers, or almost 20% of its employees, in a restructuring. The transfer got here after experiences the corporate burned $17 million in money every month in the course of the fourth quarter and that it’s making an attempt to protect runway.

Evaluation of the week

Fintech, oh, fintech. Final yr 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 line with PitchBook knowledge. 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 autumn was an excellent one. In accordance with CB Insights, fintech noticed eight new unicorns in the course of the interval and fairness funding enhance 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 bounce are spectacular in an setting had been mega-rounds (offers value over $100 million) are few and much between. CB Insights’ State of Enterprise Report 2023 discovered that whereas mega-rounds “had been a trademark of 2021, with 350+ occurring every quarter . . . in This autumn’23, that determine fell to simply 78 — the bottom degree since 2017.”

What else we’re writing

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

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

PayPal will start piloting a number of new upcoming updates to its service, a few of which can 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.