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Conversation
Highlights
In this episode of Unicorn Builders, we speak with, co-founder and co-CEO of Brex, the fintech decacorn most recently valued at more than $12 billion dollars. Brex made waves in 2018 when they became a unicorn in less than two years, when Henrique and his co-founder were just 22. They’ve been on a tear ever since.
Where the Journey Began
Brex is not the first business for Henrique and his co-founder. They co-founded PagarMi at just 16 years old. With a modest $300,000 in funding, they learned early on how to operate a company with their backs against the wall. At one point, with two months of runway left, their investor said they wouldn’t invest any further and wouldn’t let them raise more money, this forced them to learn how to grow company when it’s life or death.
They ended up successfully growing the business, hiring 150 employees and generating tens of millions in revenue before selling the company at just 19 years old. After the sale, they left their native Brazil and moved to the US with valuable lessons learned from their experience.
Using everything they learned from PagarMi, when they launched Brex, they were able to bypass many of the common challenges early stage founders struggle with. Very early on they were able to nail their positioning and find product market fit right away allowing them to scale at a breakneck pace since practically day 1.
Henrique and I have an incredibly fun conversation full of lots of valuable learnings for founders. Here are the top things I learned from the conversation with Henrique about his journey building Brex.
#1: What to do when facing negative press
“It’s understanding that this too shall pass. I think it’s normal for humans to think that everyone is thinking about them 100% of the time, but turns out people are just thinking about themselves most of the time. People think that you come one bad article, two bad articles, everyone’s going to remember it forever. But there’s the next news cycle and the next news cycle. Right. And there’s always something more interesting going on than your company. So I would say that just remember that this too shall pass.”
💡Actionable takeaway: When you build a company at scale, there’s a high chance you will eventually find your company on the receiving end of negative press. Remember there’s always another news cycle, keep calm, and stay focused on executing on your vision.
#2: Keep your ego in check by surrounding yourself with people who will call you out
“Most times you hear entrepreneurs talking about this. The answer goes some version of like, oh, it’s important to stay humble and grounded and stuff like that. But I think the reality is it’s really hard to do. I started being in the press when I was 14 years old, and if you have the whole world telling you’re a genius, you start believing it.
The first step is to acknowledging that it might happen to you, that you’re not immune to it. And thinking about, is it happening already? And having people around you that you trust, they can just call you out on it.
And they explicitly have talks about like, hey, if my ego is going crazy, please let me know. Please call me out, because you really need to acknowledge that it could happen to you’re not immune to it. Which I think a lot of founders think, that’s never going to happen to me. Right. But it does. It’s really hard not to happen. So, I just build people around me and build systems so that they call me out.”
💡Actionable takeaway: As you experience success, make sure to surround yourself with people that will brutally honest with you.
#3: How Brex’s co-CEO structure works
“We have an internal versus external CEO. So I’m external. So that means I have zero direct reports, which I love. I’m not the best manager and don’t love doing it, but I get to spend a lot of time with customers, a lot of time with partners, a lot of time fundraising, PR, anyone that needs to meet the CEO Brex. I just have more time than the average CEO to do those things. And that’s really beneficial to the company.
Same thing with Pedro. He actually manages the whole company and he has more time, I would say, than the average CEO to do that because he doesn’t need to worry about fundraising and board management and PR and all the other things CEOs do. And I think it just gets us to both spend more time on what we’re really good at and be really great at it. I would say that’s probably one of the superpowers of Rex is our coco structure.”
💡Actionable takeaway: Maintain an open-minded approach towards defining the roles and responsibilities for you and your co-founder. Rather than adhering to conventional structures, craft a build a structure that leverages both of your strengths and compensates for any weaknesses.
#4: Don’t forget to celebrate the wins
“We’re a hyper self critical organization. You probably noticed me during this podcast mention a couple of things that we’re not very good at and that we could be doing better. And I think that’s pretty representative of our internal culture.
And I think that it’s good to some extent because we’re also getting better. But I would say I would love to get better at the other side, which is celebrating our wins more and having a culture where we feel we’re winning all the time.
💡Actionable takeaway: Being committed to excellence can be good but it can also make it easy to get so caught up you forget to celebrate major wins and progress. Celebrate the wins with your team then get right back to work.
#5: Don’t assume employees who want more cash than stock are not committed
“There’s this MO in Silicon Valley that says, like, oh, if an employee doesn’t want to come for very low cash comp, it means they’re not committed enough to the opportunity. And we have a model at Brex for the longest time where people can decide how much cash, how much stock they want out of a TCV number.
We looked at a lot of data and it turns out there’s no correlation of performance or attrition for people who picked higher cash than higher stock. The only thing that correlated is like, what are their living expenses? Do they have kids? How many kids do they have? Where do they live? Do they have private school and they have a mortgage?
If they can’t come to a startup because they have these things, doesn’t mean that they’re not committed, it just means they made those life decisions before and you’re just erring on the side of people that are very young.”
💡Actionable takeaway: Question wide-held beliefs in Silicon Valley and make your own decisions about how you will operate your company.
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