Ramp raises $ 300 million at $ 3.9 billion valuation, makes first acquisition – TechCrunch

Less than five months after raising $ 115 million, expense management started Ramp announced today that it has raised $ 300 million in a Series C funding round that values ​​the company at $ 3.9 billion.

That’s more than double the $ 1.6 billion that New York-based Ramp was valued in April at the time of its B series.

Founders Fund led the latest round, bringing total fintech equity and debt raised to date to more than $ 625 million since its inception in March 2019. Redpoint Ventures, Thrive Capital, D1 Capital Partners, Spark Capital, Coatue Management , Iconiq, Altimeter, Stripe, Lux Capital, A * Partners, Definition Capital and other existing sponsors participated in the financing. Founders Fund also led the $ 15 million Series A Ramp in February 2020.

It’s been a good year for Ramp, which first launched its corporate card in August 2019. Since early 2021, the company says it has seen the number of cardholders on its platform multiply by 5, with more than 2,000 companies. currently using Ramp. as your “premier expense management solution”. The volume of transactions on its corporate cards has tripled since April, when its last increase was announced. And impressively, Ramp has seen its transaction volume increase year-over-year by 1,000%, according to CEO and co-founder Eric Glyman. Given the company’s business model (it makes money primarily from interchange fees), ramp also saw its revenue increase by the same amount during that time period.

Ramp is used by a wide range of clients from startups / unicorns like Ro, DoNotPay, Better, ClickUp, and Applied Intuition to established businesses like Bristol Hospice, Walther Farms, Douglas Elliman, and Planned Parenthood.

“The pace of growth in the business has been much faster than people expected and that is a large part of what supports this new investment and valuation,” Glyman told TechCrunch. “Even in August, we are experiencing what is shaping up to be the fastest percentage growth of the entire year, if not ever.”

In fact, these very large growth figures are most often seen in the early stages of a business and tend to decline over time as the business matures.

Keith Rabois of Founders Fund says: “As the company has grown, I have continued to invest heavily because it is rare to find a company with a growth rate that is actually increasing as it grows. Growth typically slows as the business grows, but demand for Ramp’s product only accelerates as the team raises awareness and strengthens its product offering. “

Ramp also announced today the acquisition of Buyer, a “negotiation as a service” platform that aims to save its customers an average of 27.3% on high-value purchases, such as annual software contracts.

With the addition of the 10-person buyer team, Glyman said Ramp will be able to offer its customers a “personalized and proactive approach” to saving on large purchases.

“There are more B2B growing SaaS companies than ever before, and they charge better than ever,” he said. “The buyer is seen as the leader of a generation of startups that are trying to turn the tables and help customers lower rates. Very large companies may have procurement departments to negotiate rates, but for those that do not, the Buyer is very adept at identifying new contracts that are coming up and negotiating them. “

It has saved its clients around 27% on SaaS contracts.

“We look forward to adding those numbers to the savings we have helped companies build in,” Glyman said.

The purchase follows a partnership that was forged earlier this year before Ramp realized it could “get even stronger by having them as part of the Ramp team, and really build even more.”

Overtime, Ramp intends to expand its product offering as a result of the acquisition. By combining the buyer’s team with benchmarking spend data from millions of transactions on its platform, Ramp says it wants to help its customers negotiate the best rate on “anything that can be purchased with a card, from travel to software, aiming to shift purchasing power back into the hands of buyers. “

Image credits: Ramp

Other ways Ramp helps its customers save include offering a 1.5% cash back “on everything”, helping them identify ways to spend less, such as identifying and canceling duplicate subscriptions, and identifying license redundancies. It also shows companies when better prices are available. An example of this is letting them know that they can save 20% by switching to an annual rate, rather than monthly. It has also helped clients save by ditching software like Concur, Expensify, or Bill.com by helping them manage their expenses. Ramp claims that its customers, on average, save 3.3% per year per changing your corporate card spending to Ramp.

Earlier this year, the company added merchant blocking to its corporate credit card, which Glyman says has likely become one of the company’s. most used features since its adoption.

Going forward, the company plans to use its new capital to accelerate the development of its financial automation platform. Naturally, he will continue to hire as well, adding to his team of nearly 150 people. For context, Ramp started the year with 65 people and employed about 100 at the time of its April increase.

“Hiring will be the biggest use of our capital,” Glyman told TechCrunch.

The startup will also invest heavily in product development, including expanding to broader B2B payments, marketing, and awareness. It will also look for more acquisition targets.

While Ramp currently makes money primarily from exchange fees, Glyman previously told me that the two-year-old startup considers itself a SaaS operator.

“Our long-term strategy is to develop great software,” he said.

The expense management space is certainly heating up. Last week, Brex announced that it was acquiring one-year Weav for $ 50 million in its first significant acquisition. Founded in 2017, San Francisco-based Brex earlier this year was valued at $ 7.4 billion after raising a $ 425 million Series D led by Tiger Global. It is more focused on startups in earlier stages, while Ramp tends to serve larger, more established companies.



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