As Spend Management Grows, Brex and Rho Collaborate with AI Startups to Innovate New Offerings

The competition in the spend management sector is intensifying. Today, both Brex and Rho unveiled their AI-enhanced accounts payable solutions.

Their announcements coincided with Ramp's expansion into procurement, highlighting the urgency among these companies to meet rising customer needs and outdo one another in their offerings aimed at effective spend control. Specifically, Brex launched Payables, its AI-powered Accounts Payable (AP) product, while Rho introduced advanced AI-driven AP automation. Brex's offering is available now, and Rho’s capabilities will go live later this month.

In an email, Brex co-CEO and co-founder Henrique Dubugras shared that the product's development has been ongoing since the inception of Empower, their spend management platform, over a year ago. He explained that Brex has long used artificial intelligence for functions like customer support and underwriting. What’s new is their collaboration with multiple machine learning companies, including Scale AI and Photon, to achieve the highest accuracy in information extraction from invoices.

Prior to this launch, Brex provided a basic bill pay feature that allowed clients to schedule and automate payments. Now, Dubugras indicated they will offer enhanced spend controls, including multi-level approvals.

Rho, on the other hand, is providing AI-driven invoice and bill processing for its customers. Invoices sent to a specific AP inbox will be automatically digitized through advanced generative AI technology. According to Rho, the process transforms an invoice into a bill, generating a liability in the client’s ERP system. Clients can then authorize bill payments individually or in bulk, with liabilities automatically marked as settled.

Rho CEO Everett Cook remarked via email that these capabilities have been in development for almost a year, expanding on the company’s initial AP release in 2021. Rho has partnered with OpenAI, which is backed by Rho's investor DFJ Growth.

With this new product, Cook asserts that customers can set up one-click workflows that enable finance teams to process thousands of payables within seconds. Rishav Chopra, Rho's SVP of Product & Design, stated, “Our belief is that generative AI must deliver tangible business value.”

Large Potential for Growth

Beyond the competitive landscape, both Brex and Rho anticipate that their innovations will drive revenue growth. Dubugras noted that the new payables solution is likely to increase the volume of customer spend processed through Brex. “This will drive more spend to the Brex card, a key revenue stream for us,” he explained. “Additionally, using a Brex business account for bill pay allows for quicker payments, reducing ACH delays while earning passive yield.”

Brex emphasizes its unique position in the market as “the only player” with its own business account capable of generating revenue in this manner, enabling them to offer payables at no charge.

Cook from Rho also noted the timing coincidence with Brex's announcement, suggesting that both companies have heard similar feedback from clients: they’re dissatisfied with their legacy AP providers and seek a modern solution fully integrated with their financial systems. Competitors in the legacy space include Bill.com and Concur.

Dubugras believes the robust competition in this area exists for a compelling reason: “The spend management landscape is dynamic due to the vast opportunities spanning SaaS and payments. Amidst the noise, significant differentiation remains among industry players.”

Rho’s Chopra added that the current macroeconomic environment has placed increased pressure on CFOs and finance teams to expedite processes and operate more efficiently, further driving demand for effective spend management solutions.

For the latest updates in fintech, subscribe to The Interchange here.