Brex, a corporate card and financial product startup that has raised $315 million in equity and reached a reported valuation of $2.6 billion since its 2017 founding, is optimistic about venture capital funding for tech companies, despite current market volatility. 

“Within our sector, we definitely may have a slowdown, but it’s not doomsday, where nobody is ever going to get funded,” said Brex co-founder Henrique Dubugras during a webinar the company hosted on startup fundraising. “At least in previous crises, there is some precedent for tech actually growing.”

According to Dubugras, the pandemic will affect late-stage more than early-stage funding because investors bet on early-stage companies in the hopes one or two will provide billion-dollar payoffs years down the road. This potential isn’t affected by an immediate economic downturn. Late-stage funding, on the other hand, usually means smaller, more immediate returns that won’t fare as well during a recession, so investors could be more hesitant. 

Michael Tannenbaum, chief financial officer at Brex, added that late-stage funding might not send the best message during the pandemic and resulting volatility. Investors know late-stage companies and their valuations are more affected by the public markets, so Tannenbaum advised against raising such funding unless it’s “absolutely critical.”

“We’re not sure exactly when life will return to normal. Now is a strange time to come out with a capital raise,” Tannenbaum said. “I expect it will be interpreted as weakness.” 

See also: Inside Brex’s approach to raising money

Tannenbaum added that, even for early-stage funding, investors might be slower to commit because they can’t meet with founders in person, and it’s hard to develop relationships over virtual meetings. He suggested startups use their existing network and contacts to raise capital. The sentiment is shared by investors, as Ruth Foxe Blader, a partner at the venture capital firm Anthemis Group, recently told Bank Innovation that in-person meetings often help investors “pull the trigger” on fintech investments.

Brex today announced three acquisitions: blockchain technology company Neji, the informational video company Compose Labs, and the knowledge database building company Landria. 

However, the pandemic is affecting spending on Brex cards; Tannenbaum said startups using its cards are spending less on rideshare, travel and restaurants while spending on e-commerce and food delivery has increased.

Brex offers corporate cards for startups, as well as life sciences and e-commerce companies. The company underwrites clients using cash flow, venture capital funding, sales volume and cash burn rates. Brex, which makes money from the interest-free cards through interchange fees, launched Brex Cash, a cash account, in October. 

According to Dubugras, startups will be well-served to show investors they are concerned and prepared for the coronavirus pandemic. “A big part of [investors’] job is to go to other investors and talk about how bad the market is going to be with COVID-19,” he said. “The best thing you can do for the relationship with your board of investors is to show them you are as paranoid as they are.”