Credit card review: Brex Corporate Card for startups bridges a gap
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|The Brex Corportate Card for Startups offers a lucrative rewards structure and generous benefits for cardholders who pass its selective application process. While you can get a lot of value out of this card, keep in mind that it isn’t as widely available as small business credit cards.||Card Rating*: ⭐⭐⭐1/2|
*Card Rating is based on the opinion of TPG’s editors and is not influenced by the card issuer.
It’s pretty easy to find a small business credit card that fits your needs, whether you’re looking for a way to earn rewards to fund business travel, save on monthly bills or a mix of both. But tech startups and larger businesses who spend far more than the rewards caps on small business cards may be hard-pressed to find a corporate card that caters to their needs while still offering rewards and other perks at the scale they need.
Brex has launched three new corporate cards in the hopes of bridging that gap. They offer cards tailored to three specific types of businesses: startups, e-commerce firms and life sciences companies. Today, let’s walk through the advantages and disadvantages of one of those three flavors of Brex cards, the Brex Corporate Card for Startups. The card has an impressive rewards structure at first glance, but is it worth the hype?
Who is this card for?
While you don’t have to be a registered business to apply for and utilize a small business credit card, that isn’t the case for the corporate cards offered by Brex. These cards are only available to US corporations and other forms of non-individual liability companies, such as LLcs, LLPs, C-corps and S-corps. Furthermore, you have to have at least $100,000 in a business bank account to qualify for a card. Unfortunately, that means freelancers, sole proprietors and side hustlers won’t be eligible. Granted, the card is tailored to meet the needs of larger businesses, so if you don’t qualify for the card, it’s likely that you would be better off with a small business card anyway.
On the flip side, one of the reasons you have to be a non-individual liability company is because Brex cards do not require a personal guarantee. Brex acts as the underwriter on the card, and they use your employer identification number (EIN) rather than a personal SSN. Because of this, your Brex card doesn’t affect your personal credit score (though it will affect your business credit score). It also means you’ll have a higher spending limit than on a traditional small business card.
Two things to keep in mind. First, Brex is a charge card, and payments are automatically drafted out of your business account each month. Second, Brex requires access to a business banking account. Some may find this intrusive, but it’s how Brex justifies offering larger spending limits to its customers.
In the end, only registered businesses with significant equity that can take advantage of Brex’s specific rewards program should apply for the Brex card. Those looking for a business card for luxury perks should look elsewhere.
Related: Find out more from Brex co-founder and co-CEO, Henrique Dubugras, and the head of partnerships, Thomas Piani, and rewards on this episode of Talking Points.
Easy-to-hit sign-up bonus
Right now, Brex is offering 75,000 points to new cardholders after spending $1,000 on the card. That’s a generous offer for such a low spending requirement. According to the latest TPG valuations, Brex Exclusive Rewards points are worth 1.7 cents each, making this bonus worth $1,275. As an additional bonus, approved business owners will also receive waived annual fees for life, so you’ll be able to enjoy the full worth of the bonus without taking out a hefty fee from the issuer.
While we’ve seen a higher bonus offered before with this card, 75,000 is still a great bonus — especially since the spending requirement is so low. If your business qualifies for the card, it’s likely you’ll hit this bonus requirement in your sleep.
Brex also offers an impressive list of sign-up benefits that includes discounts to WeWork, Google Ads and more. These benefits can be used at any time, so you can get value from the sign-up package long after your first year with the card.
Further reading: Brex and JetBlue announce new transfer partnership, new signup bonus
Main perks and benefits
The Brex Card for Startups doesn’t offer a lot of the perks you’ll see across traditional small business cards or luxury travel cards from issuers like Amex and Chase. The card doesn’t offer hundreds of dollars in travel credits, you won’t get automatic elite status at any hotel brands and you won’t get exclusive lounge access. However, Brex does offer an impressive list of discounts on top services.
For example, you’ll get up to $5,000 in credit over a year on Amazon Web Services. You’ll get up to $150 in Google Ads credit and new US WeWork office spaces are up to 15% off. Other partners include Zoom, HubSpot, Zendesk, Salesforce, Experian and more. Brex values their partner offers at over $50,000 in value. While it’s unlikely that any business — startup or otherwise — will take advantage of every single partner offer, corporations can certainly save a lot of money through these offers.
As a World Elite Mastercard, Brex cards also come with perks like access to Mastercard Travel Services and Mastercard Airport Concierge. Plus, an array of additional travel perks and services.
The Brex card also comes with business features, including expense management tools, accounting integration and receipt capture capabilities. Your first five cards are included with no annual fee, but you will pay $5 per user per month for additional cards beyond that.
Each type of Brex card offers a different rewards structure, but the Brex Corporate Card for Startups offers the rewards structure that would be beneficial to the widest range of corporations.
With this card, you’ll earn:
- 7x on rideshare, including Uber, Lyft, taxis, scooters and more
- 4x on travel booked through the Brex travel portal
- 3x on restaurants
- 2x on recurring software subscriptions
- 1x on everything else
The rewards structure comes with some sticker shock. Getting 7x on any category outside of a cobranded hotel credit card is rare, but keep in mind that out of all of these categories, a high-powered corporation is likely to spend the least on rideshares throughout the year. It’s a great return, but make sure that this is a category you’re actually spending a lot on before jumping for joy at the 7x multiplier.
The rest of the categories are also generous. Earning 4x on travel is great, especially since it isn’t as strict in definition as Amex Business Platinum is on 5x for airfare. Just keep in mind that you’re booking through an issuer portal, so there is a possibility that you won’t earn elite qualifying points or miles on some bookings, especially hotel reservations.
My personal favorite spending category for business is the 2x on software. This specific category is something you don’t see often on small business cards, and Brex has a broad definition for recurring software subscriptions. Pretty much any subscription qualifies, from Slack to Salesforce to Grammarly to everything in between. You have the potential to earn a lucrative number of points annually on your business subscriptions alone.
What really sets Brex apart from small business cards is that there is no cap on bonus rewards. Traditional small business cards will cap your rewards annually, typically in the $150,000 range. Corporations spending $500,000 or more each year would be left juggling five different credit cards (all with a different rewards structure and annual fee) to earn bonus rewards all year. With Brex, you’re earning 7x, 4x, 3x and 2x rewards whether you spend $100,000 a year or $1 million.
Unfortunately, there’s a catch. In order to qualify for this rewards structure, this has to be your exclusive corporate card. What does that mean, exactly? Well, Brex doesn’t clearly define exclusivity, and considering you’re stuck with a flat 1x on all purchases if this requirement isn’t met, this lack of clarity in the terms and conditions is concerning. While you may be able to get away with just putting the majority of your spending on the card to qualify for bonus rewards, it’s possible that full exclusivity is required. If you’re not ready to call it quits with your other business and/or corporate cards, Brex may not be the card for you.
Further reading: Brex will send you to a destination of your choice with JetBlue
Traditionally, Brex points were worth a standard 1 cent each which you could redeem as a statement credit or on travel through the Brex portal. But now, Brex has added airline transfer partners as a redemption option, greatly increasing the value of its program. Most recently, JetBlue was added to the line-up of options.
So far, there are seven transfer partners:
- Aeromexico Club Premier
- Air France/KLM Flying Blue
- Avianca LifeMiles
- Cathay Pacific Asia Miles
- JetBlue TrueBlue
- Qantas Frequent Flyer Program
- Singapore KrisFlyer
Brex points transfer at a 1:1 ratio, and points can also be transferred to any employee account.
Transferable points currencies to a variety of partners has become more valuable as many airlines have shifted toward dynamic award pricing. The addition of transfer partners to the Brex program is a major improvement.
Fortunately, all three major airline alliances are represented by this initial list: Star Alliance, Oneworld and SkyTeam. This greatly opens up your redemption options. For example, you can transfer Brex points to Avianca LifeMiles at a 1:1 ratio, then redeem those miles for a Lufthansa first class flight from the US to Europe at a low rate — all without costly carrier surcharges.
Further reading: Maximizing Oneworld award flights with Brex transfer partners
Do any cards compete with the Brex Corporate Card for Startups?
The Brex card is pretty unique. It’s built for a niche group of businesses, and therefore isn’t comparable to many other cards. Its only direct competitors are other corporate cards.
Amex offers a suite of corporate cards, from the basic Corporate Green Card to the premium Corporate Platinum Card®. Those who want a corporate card that offers luxury travel benefits might be more inclined to apply for the Platinum, which offers Global Lounge Collection access, a Global Entry/TSA PreCheck application fee credit (up to $100), complimentary Hilton Honors Gold status, a $100 airline fee credit and more. However, you’ll also be paying a $395 annual fee, and the Corporate Platinum Card doesn’t offer the same services discounts or as generous of a rewards structure.
If you meet the requirements to apply and have a budget that outpaces the spending limits and rewards caps on typical business cards, the Brex Corporate Card for Startups could be exactly what you need. The program continues to improve as Brex adds more airline partnerships. The rewards structure is generous if the majority of your business spending falls within those categories.
However, the fact that you have to have $100,000 in a business account and use the Brex Card exclusively to earn rewards will limit many businesses. To be abundantly clear: this is not the best card for every business owner. If you can maximize the bonuses and rewards rates on small business credit cards, I would apply for those first. This is a card built for startups and corporations that are outspending traditional small business cards by a longshot.
Before applying, I would suggest reaching out to the Brex sales team to ask any clarifying questions and walk through your specific business needs.
However, for those who can take advantage of what Brex has to offer, it’s a head-turner of a corporate card. If you’re looking for a card built specifically to help your budding corporation grow, take advantage of the 75,000 bonus points and reap the uncapped rewards potential of the Brex Exclusive Rewards program.
Official application link: Earn 75,000 bonus points with the current offer on the Brex Corporate Card for Startups.