Brex Acquires Weav for $50M - Expanding Commerce API Capabilities

Brex Acquires Weav in $50 Million Deal to Enhance Commerce Connectivity

Fintech company Brex initially established a partnership with Weav, a provider of a universal API for commerce platforms, during the previous summer.

In March, Brex introduced Instant Payouts for Shopify merchants, leveraging the startup’s innovative technology.

The positive outcomes were substantial enough that, by April, Brex co-founders Henrique Dubugras and Pedro Franceschi invested in Weav’s $4.3 million seed funding round as strategic angel investors.

Strategic Acquisition of Weav

Over recent months, the founders concluded that Weav’s technology – and its team – presented an opportunity too valuable to simply share. Consequently, Brex is announcing the acquisition of the one-year-old Weav for $50 million, marking its first major acquisition, as exclusively learned by TechCrunch.

Remarkably, the agreement was finalized without the founders of either organization having met in person – a circumstance that might have been less common before the COVID-19 pandemic, but is increasingly prevalent today. (They have since connected.) Brex has previously completed ‘acquihires’ but has not before acquired both a company’s technology and its personnel.

Brex began collaborating with Weav “early on” in the company’s development as a partner, according to Dubugras.

“We were deeply impressed by [CEO] Nadav [Lidor] and his team, their rapid development pace, and the quality of their technology, prompting us to explore a more strategic collaboration,” he explained to TechCrunch. “This ultimately led to discussions about a potential acquisition.”

Deal Details and Significance

TechCrunch spoke with Dubugras and Weav CEO and co-founder Lidor to gain insights into the specifics of the deal and its importance for both companies.

A key aspect of the acquisition is Brex’s planned expansion of its global footprint. This will involve establishing an “innovation hub” and recruiting employees in Israel, in addition to Weav’s existing nine-person team based in Israel and New York. Lidor will lead Brex’s new Israeli office.

Beyond expanding its international reach, the acquired technology will accelerate Brex’s platform connectivity, Dubugras stated. Currently, Brex provides credit cards, business cash accounts, spend management, and bill pay software within a unified dashboard for its clientele, primarily startups. The company aims to broaden its product and service offerings to become “a fully-integrated and comprehensive financial platform for businesses.”

“Weav’s technology will significantly enhance the value Brex delivers to its customers,” he added.

Weav’s Background and Growth

Founded last year by engineers Ambika Acharya, Avikam Agur, and Lidor, following their participation in the W20 YC batch, Weav emerged as part of a wave of fintech infrastructure companies focused on empowering fintechs and financial institutions. Specifically, Weav’s embedded technology was designed to provide organizations with access to “real time, user-permissioned” commerce data, enabling the creation of new financial products for small businesses.

Its products enable customers to connect to multiple platforms through a single API, specifically developed for the commerce platforms businesses utilize for sales and payment processing. Weav operates on the principle that facilitating the development and embedding of new financial products creates new opportunities for e-commerce merchants, creators, and entrepreneurs.

Since its launch last year, Weav’s API call volume has experienced a monthly growth rate of 300%.

The increasing adoption of cloud and SaaS technologies has resulted in data being dispersed across various systems. Weav’s API aims to establish digital connections that facilitate automatic sharing and analysis, allowing commerce platforms to access their customers’ standardized transaction data in real time. This is crucial for Brex, as it believes that leveraging Weav’s technology will enable businesses using its platform to receive financial services and new products “more quickly and accurately.”

“Our vision is to build an all-in-one finance platform,” Dubugras told TechCrunch. “This acquisition accelerates our progress, allowing us to create a better integration across all our financial products and innovate at a faster pace than originally planned.”

Future Plans and Integration

For instance, he noted, Brex currently integrates with platforms like Shopify. With the acquisition of Weav, it intends to develop more lending, visualization, and insights products for its customers.

“The Weav team will essentially oversee all third-party integrations,” Dubugras explained, “ensuring that Brex can serve as your financial operating system regardless of where your data resides. You’ll have everything consolidated in one place.”

Lidor acknowledged that Weav did not anticipate an exit so soon after its founding. However, the companies found common ground, he said.

“Our objective has always been to connect businesses, creators, and entrepreneurs with fintech to broaden financial access, and this aligns perfectly with Brex’s mission,” Lidor added. “After collaborating with Henrique and Pedro, we realized they were the ideal partner. We were equally impressed with the Brex team and enjoyed learning from and building with them.”

Financial Details and Expansion

The company did not disclose its valuation at the time of its $4.3 million seed round earlier this year. The $50 million price tag represents a “favorable multiple for all parties involved,” Dubugras stated.

The expansion into Israel is also exciting for the Brex team, which transitioned to a remote work model last year amid the COVID-19 pandemic, with operations in the United States, Canada, and Brazil.

Founded in 2017, San Francisco-based Brex was valued at $7.4 billion earlier this year after securing a $425 million Series D led by Tiger Global. The company has raised $1.2 billion in debt and equity financing, according to Crunchbase data.

Earlier this year, the company launched a new service called Brex Premium, priced at $49 per month.

“The number of premium subscribers we’ve attracted has significantly exceeded our expectations,” Dubugras said.

In February, Brex joined other fintechs in applying for a bank charter.

The company, which offers a credit card specifically designed for startups, currently utilizes Emigrant Bank as the issuer, and had submitted applications with the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (UDFI) to establish Brex Bank.

Earlier this month, the company announced its voluntary withdrawal of its bank charter and federal deposit insurance applications.

“This will allow us to refine and strengthen our application and resubmit at a later date,” the company stated. “We appreciate the support and guidance from the Utah DFI and FDIC.”