Ramp, a leading fintech startup, has raised an impressive $300 million in a funding round co-led by existing backer Thrive Capital and new investor Sands Capital. This significant investment comes at a post-money valuation of $5.8 billion, marking a notable milestone for the company.
A Brief Look at Ramp’s History
Ramp was founded in 2019 with a focus on providing spend management solutions to businesses. Since its inception, the company has secured an impressive $970 million in equity financing and $700 million in committed debt funding. In March 2022, Ramp raised $200 million in equity funding at an $8.1 billion valuation.
A Valuation Drop Amidst a Challenging Market
The fintech industry has seen its fair share of valuations drops over the past 18 months. Larger private companies such as Stripe and Klarna have experienced significant declines in their valuations. Even Ramp’s current valuation is not far off from projections made by Notice.co, a company that provides a pricing tool for the private markets. According to Notice founder Tyson Hendricksen, Ramp’s secondary share trading indicated a valuation of $4.8 billion.
Ramp’s Revenue Growth and Expansion
Despite the challenging market conditions, Ramp has been able to achieve significant revenue growth. In March 2022, co-founder and CEO Eric Glyman told TechCrunch that the company had seen its revenue grow by 4x in the previous year. The company’s fastest-growing segment was bill pay, which contributed significantly to its revenue growth. As of early August, Ramp reported that it had crossed $300 million in annualized revenue.
Using New Capital to Accelerate Growth
The new capital raised will be used by Ramp to accelerate product development, expand into adjacent categories, and hire significantly in the second half of this year. The company has been vocal about its desire to grow both products and customers.
Ramp’s Acquisition and Expansion Strategy
In June, TechCrunch exclusively reported that Ramp had acquired Cohere.io, a startup that built an AI-powered customer support tool. Earlier this month, Ramp announced that it was entering the procurement space as it focused more on complex enterprises. The company has also landed a new customer in Canadian e-commerce giant Shopify.
Ramp’s Product Offering and Customer Base
Over time, Ramp has continued to add features to its offerings, including bill pay, vendor management, and travel expense management. While the startup started out focused on small-to-medium-sized businesses (SMBs), it now works with businesses of all sizes – from startups to multibillion-dollar enterprises.
Conclusion
Ramp’s latest funding round is a testament to the company’s growth and potential in the fintech space. With its expanded product offerings, customer base, and significant revenue growth, Ramp is well-positioned for continued success.
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