This is the Brex pitch deck to raise their $57m series-B in 2019. Brex is the first corporate card for startups, tech, and online brands.
About
The issue is that a startup can have $millions of venture dollars in the bank and still not get approved for a credit card. This is because old-school banks and credit institutions want to see a credit history, which few new companies have, duh.
Brex provides a corporate credit card called the Brex Visa for technology companies. It helps startups of all sizes (from recently incorporated to later-stage companies) to instantly get a credit card that has 20x higher limits, completely automates expense management, kills receipt tracking, and magically integrates with their accounting systems.
Henrique Dubugras and Pedro Franceschi, two engineers who previously founded Pagar.me, one of the largest payment processors in Brazil with over $1.5 billion in GMV, founded Brex.
Brex is backed by the co-founders of PayPal (Max Levchin and Peter Thiel), Y Combinator, Ribbit Capital, Yuri Milner, and Carl Pascarella (former CEO of Visa). Brex is building the next generation of B2B financial services with better tech and without the restrictions of legacy technology.
Funding rounds
Brex pitch deck review summary
It’s ok. It’s not great, but it’s not terrible. When you first look, you would think that the deck Is for a seed-stage company. that just doesn’t seem to have to be terribly much thought put into it and typically series B decks would be at least 20 slides long, if not more.
Like the Airbnb pitch deck, there are some points around the simplicity that can be learned from but without understanding the contacts this can be very misleading.
These guys are sexy startups and investors were throwing themselves in order to fund the deal. because of this fact they spent very little time thinking about and preparing for their fundraising rounds. Indeed the CEO said that they spent only two days getting their pitch deck done. And my guess it was because investors were asking for some kind of pitch that they could have.
This is one of the dangers of reading pitch decks to learn how to apply to your own pitch deck; the rules do not apply in the same way to you as they don’t to them. They can get away with a lot of things you can’t, or would be frowned upon by investors and you would have to make up for it when you’re pitching.
The deck covers a lot of the points that they need to cover, touching on market size, defensibility, landing and expanding, and value proposition. They obviously cover all the basics including problem, solution, products, etc. They get to the point quite well, they don’t write too much, but it’s all very underwhelming. If they didn’t have the traction, they’d have a hard time raising.
There might be some things to take away from the deck, but it serves as an opportunity for you to think more critically about how you could make the slides better and by proxy improve yours.
Slide by slide review
Words
The amount of words per slide is on the side of being too low. They don’t explain a lot that they could. My guess is that they’re going to pitch and explain everything in person as they had a quick raise.
Sometimes there are not enough words and a few more would enable the reader to get more insight.
They don’t write any paragraphs, and generally, everywhere they use bullet points which is ideal.
Slide length
It’s a quick read, so length is not important. There are 18 slides which are on the longer end for some, but I believe are on the short end for a series-B. I don’t think that the length is an issue, but rather the lack of details on the slides.
There are no page numbers…
Headers
They do a much better job than most startups with their headers. The headers are the first things an investor will read (and maybe the only thing) so they are key. Headers are also key in communicating a narrative.
I have three levels of quality headers:
- Slide title: Founders copy the Sequoia outline without understanding they are not just meant to write ‘problem’
- Highlighted title: The slide header lightly calls attention to the core point but doesn’t explain why. ‘Productivity is the holy grail’
- Explained problem: The slide is fully explained so you understand the content without reading. ‘Staff that want to work are 17x more productive than staff who feel they simply have to work’
Brex is in camp 2. They make an effort, but don’t make enough effort to make reading the deck effortless without having to think. This is because very little is explained in the body.
They don’t always have proper headers which is annoying. It requires me to read the slide to actually understand what the point is. Make it easy for investors to get in and out.
Appearance
It’s the minimum you need, which does go to show that design is not that important. It could be done a little better, but an hour or two would be all.
Narrative
As I explained in the headers section, they use the headers moderately well to tell their story. They get to the point a little tersely though. Some slides don’t have headers so that breaks the narrative. Every main slide needs to have a header.
Structure
Things are generally aligned well. Occasionally it needs to be improved. They should really have headers whenever they use charts to explain them better. Slide 5 is a good example- I can only guess what the graph on the right means.
It’s a good example of “Fck we need to send something ASAP!” Beyond an hour improving it, you start getting diminishing returns.
Slides
They generally cover everything they need to. It’s your typical Silicon Valley that gives us cash to blow so we can grow fast startup. There are no projections or any kind.
There’s no ask slide, but many startups would remove this from their deck before they shared it.
I’m only flicking through this quickly. I’d have to spend some time thinking before I could point to slides they should have covered, which is sort of a good thing as it covers the sniff test, or rather the flick test.
Slide by slide review
The cover is fine. They could have added a simple tagline so investors get some inkling of what the startup is about. Less is generally better on your cover as it just doesn’t add all that much, and adding things like dates can cause issues.
They kick off with the team and investors. Normally only founders with big names do this. I normally put it in the middle of the deck. The point is “you know who we are, so take what we say seriously”.
There are no points about the team other than name, title, logos. Only big people can do this.
Half the slide is investors. This is a big social proof “feck you”. Peter and Max are in and we know you want to be too. There are few times I would ever put investors on the team slide.
The body of a slide should always back up what you claim in the header. Here you can see they have simply taken real examples of the terms for credit cards and startups being denied. This is relatively crude but effective. I would add some more commentary to the slide as it feels like a presentation you give on the stage.
They go on to explain more problems in a smack smack fashion with little to no narrative, but they keep it simple so it’s ok, but not great.
This slide adds to the problems, even if people get credit cards. They’re effectively saying what their product does and solves without saying it- something I always try to do.
There is no data to back this up and I don’t feel like it is a huge issue, but hey who am I to judge. I hate boring finance stuff.
This slide is messed up. My first guess is that in the conversion to PDF from PPT things went wrong (they do sometimes). But apparently, that’s not the case, they just didn’t give a shite. Lol.
Dubugras said making the presentation “pretty” wasn’t a priority. He worked with Brex’s chief financial officer, Michael Tannenbaum, to put together the pitch deck in two nights. They didn’t spend too much time on it, Dubugras said, because he wanted to show investors that they were too busy working on company priorities.
“At the end of the day, investors will see through any pitch deck. I think that the important thing is to be super clear and objective,” Dubugras said.
Honest to god, not giving a toss to size titles the same size and same color is the peak is belligerent. It demonstrates a total lack of attention to detail.
But this comes back to the “famous/sexy founders can do what they want”. Brex was a hot deal and investors wanted in. So they can do what they like. You can’t!
Some of his mentality is spot-on:
- Investors will see through: This is true. No one believes your superlatives of “we have the best team”. Investors can tell if what you do makes sense or not, no matter how much sales bullshite you try and spin. So don’t. Be logical and support with data.
- Be super clear and objective: This is true. Ends up being the same point as above. Cut the words down, remove the sales bs, and get the mother f’n point asap! No investor wants to read your deck and it’s easy to see through your BS if you aren’t logical.
In terms of the content on the slide, it’s crap.
- Banks use outdated technology: Ok, it’s a fast way to show that banks have a shitty UI/X. Everyone knows banks are stuck on legacy tech. I personally spend more time and prove this point with data sourced from a third party.
- Market share: Ok, cool, there is an undated Nielson report which is sourced. They haven’t explained what the market share means, so I have to figure it out.
There’s the foundation of something here, it’s still garbage.
And to back up what I’m saying. Business Insider asked about, saying that not all investors agree with Dubugras’s assessment that looks don’t matter.
They shared this story with a seed-stage investor based in San Francisco, and she doubted that an unattractive pitch deck leaves a good impression on a venture capitalist. “You want people to make an effort. If you can’t remember to even take the time to edit your pitch deck, and you want $500,000 from me, it’s like, no thanks,” the investor said.
If you’re busy, just send it to a designer and they can fix everything in a few hours. Hell, I can design decks solidly in under four hours. There is no excuse.
They get into market sizing really quickly. They take the typical TAM, SAM, SOM approach. This is pretty standard but I still hate it. I invented an approach I think anyone can actually understand.
Their SOM of VC-backed stuff is $5.2b something. Is that really revenue, fees paid to processors, or? It’s not clear and so it’s deceptive. It’s like ecommerce startups using cumulative GMV and writing revenue. It’s not the same thing!!
They say they start with credit cards for corporates, then don’t explain further. I think their mindset was “we are getting funded, so let’s just make the market seem large so it passes the deal committee. Investors will throw money at us so let’s tick the box“.
Ok, they’re focusing on tech startups. They spell out the reasons for this. This is great. It’s your beachhead market. They say there is their “initial focus”, but not where they will expand to. I do this on what I call “Expansion slides” (shock).
To improve it I would add a chart with the number of startups to give an indication of how large this market is?
The content is good and it’s all the right business/VC talk investors will like and look for.
Distribution is always the biggest challenge for startups. They don’t explain their go-to-market strategy, but when they get these startups they say people are quick to sign up for three reasons – their value proposition. They explain things in a sort of “you know, do we really need to explain things to you??” fashion.
- How much higher are the limits?
- What’s the limit for another bank?
- How long is sign up for another bank?
These are the minimum I would add to a slide. It’s education and shows that you’re an insider that knows everything about their industry.
Investors love the defensibility/special sauce. Most startups have none. They have competitive advantages they can parlay into defensibility.
Come on. They’re 14 months old and they believe they are hard to switch from!? How do you prove that with that operating history? You can’t. But you can claim it. You can allude to the “because” and not bother to specify, just like, cough, someone does. Screw it, throw in a picture of a bank card, that’ll shut them up!
If you’re the cheerleader and all the quarterback VCs are trying to bang you at prom, do you want to spoil things with details and facts? No just smile confidently and whisper sweet nothings. They’ll get the details after they’ve knocked you up and are stuck with you in a trailer park. Ignore me, I’m amusing myself as writing about pitch decks is… FUN!!
Oh, ok, just realized the next four slides are the features. That’s the issue when you don’t have proper headers and you’re just flicking through decks. Hard to pay attention.
Anyway, the form of defensibility they are referring to here is called embedding. It’s a typical form of defensibility for enterprise-type companies with long sales cycles that become a key system. Pain to implement and a bigger pain to remove if things metastasize.
Apparently, they have better data? How? Why is that better? Why do I care what time the Uber trip was? They don’t explain. These slides are what you have for a stage presentation.
So how do I read this slide?
- Better controls. Ok. I know what controls are. They’re probably for the bean counters to check people aren’t spending money on coke and hookers, or taking Ubers to parties at 3 am.
- Lending home logo? Don’t understand? Confused
- Fark. Ok. what now. There is a flow chart with four points. Are you really going to make me read this to understand why better controls are important?
- Yes, yes you are. Groan. Fine. I have to turn off my audiobook as I write this to read it now.
- Ok. it’s just a list of 4 things you can control. It doesn’t really need to be a flow chart, does it? I mean couldn’t they have an icon, large header, then one line explaining the detail. Maybe add why useful?
- I wonder if other people do this, or is this a killer feature?
This slide is a bit better because there is an image and I can tell that’s a scanner. The title is receipt capture. Boom nailed it.
Fine, they have scanning. Expensify has done that for donkey years. So it’s a modern platform I extrapolate.
Oh god, I need glasses to read what’s on that. Skip.
There are logos. Ok, they integrate with Expensify etc. Xero and Quickbooks are large, so they have some of the key accounting players.
This slide is puzzling. It’s structured really poorly and not sure if it is an afterthought?
WTF is this “our young customers the money they save”? Please write sentences that mean something.
Then there’s some bloody orange bubble with italics about SaaS distribution and Groupon? I’m lost.
What does AWS have to do with points? This is a crappy slide.
Yay. So I love charts and data. So do investors. They’re easy to read and they show real things, not bs talk.
So the first thing I see is there are no numbers on the Y axis and not on the columns. This is absolutely normal for public decks. No one shares their numbers. They redact them.
Anyway, lots of growth. Investors have swelling in their nethers.
It’s volume, so it’s top of the funnel. They’re not interested in GAAP accounting niff naff.
They’re growing and still in beta. Ok. At series-b? Moving on. I would have two charts on the same slide.
Negative churn here is misleading. I’m guessing they are saying that the startups that don’t flame out raise more money to give to FAANGs and so Brex can increase volume with them. You can’t prove negative churn with what’s on this slide. I mean there are “graduation” on the left which I guess means churn through the dead pool, and monthly spend on the right, but eh. The orange italic bubble of 100x spend multiplier is sort of a weird conclusion.
Ok ok. Hang on. The source is CB Insights? So it’s not even their data? I’m so confused now.
I love unit metrics/economics. But gosh darn the formatting. It’s so hard to read. White text on a light blue shade? Have you heard of contrast??
I can’t be bothered to try to read the metrics, but the variables look like good ones to have.
But hand on. These aren’t Brex metrics, these are what they think a customer by type would look like. Ok they get points for talking about the right things, defining customer avatars, but it’s hope and rainbows.
Value proposition to whom?
This is the typical bull founders write on their team slide “we are the best team”. Ok. This slide is super weak.
Ok they have a final slide which is just their logo. What possible use does this slide have? None.
What I do is “three things to remember”. Where you write the three things investors should remember as to why this is such a great opportunity. Always be selling and drawing conclusions for investors.
Whatever you think of the deck, they still got $57m. But remember, they had investors knocking on the door… That is 99.9999% not you. Do better.
Deck Collection
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