Even Brex community programming has gone virtual as Silicon Valley enters the second week of widespread shelter-in-place orders across the state.
The $ 2.6 billion credit card startup has spent most of the past 12 months building a robust network of perks, programming, and physical to build a community among its cardholders. It opened a café and lounge and held regular fireside chats and instructions aimed at people of the same age – founders of small and medium-sized startups.
On Tuesday, it became "Brex-fast in Bed", a virtual gathering of the network of start-ups and entrepreneurs from Brex to find out how the fundraising process can be managed in the current economic uncertainty.
"We fear the impact of COVID-19 on the economy," Brex co-founder and co-CEO Henrique Dubugras told hundreds of startup employees on Tuesday. "Most small businesses save no more than a month."
The credit card startup is primarily aimed at other startups and has introduced special financial services for young companies in the e-commerce and healthcare industries. It is largely isolated from the immediate effects that mainly affected restaurants and brick-and-mortar retail, although the South Park Cafe had to be closed after an employee there tested positive for COVID-19 in early March.
But Dubugras and Brex CFO Michael Tannenbaum asked other founders to come up with an emergency plan, even if the effects, like Brex, aren't immediately obvious. The biggest changes will come months later, as venture investors slow down business procurement and write fewer, smaller checks to the hordes of startups in need of funding.
"The reality is that you have to make plans, but you can still pan very quickly," said Dubugras. "The decisions we make this week are probably not the ones we will make next week."
Dubugras said that part of Brex’s own contingency plan, which will be reviewed at a board meeting next week, is investigating where spending can go without lasting impact. Things like office rents are longer term and require more effort while lowering online marketing costs, or digital business tools are much easier to call again once the situation becomes clear. For his part, Brex said it had already reviewed the second part of the year hiring plan and could revise the number of employees as one of the emergency measures.
"For things like contingency planning and the disadvantage, you have to assume that it will take a long time," said Tannenbaum.