Spend management startup Ramp has successfully raised $150 million in its most recent funding round, bringing its post-money valuation to $7.65 billion. The funding was co-led by new investor Khosla Ventures and existing backer Founders Fund, with participation from Sequoia Capital, Greylock, and 8VC, among others. This raise is an extension of Ramp’s Series D round, which previously raised $300 million at a valuation of $5.8 billion.
Since its inception in 2019, Ramp has secured $1.2 billion in equity financing and $700 million in committed debt funding. The company has been experiencing rapid growth, with CEO Eric Glyman stating that its revenue grew four times in 2022, primarily driven by its bill pay segment. Although the company has not yet achieved profitability, it reached $100 million in annualized revenue before its third birthday and surpassed $300 million in annualized revenue last summer.
In the first quarter of this year, Ramp’s total purchase volume and revenue growth increased at a faster rate compared to the same period in 2023, indicating continued growth momentum. Glyman attributes Ramp’s success to its emphasis on artificial intelligence (AI) and believes that this played a role in attracting Khosla Ventures as an investor. Khosla Ventures is known for its early investment in OpenAI, a prominent player in the AI industry.
Ramp serves over 25,000 companies across various industries, with venture-backed startups representing a minority of its customer base. The company intends to use the new funding to further enhance its AI capabilities and automate processes, provide deeper spending insights, and improve decision-making capabilities. In line with this, Ramp announced an integration with Microsoft Copilot last November to incorporate AI into its offering.
Additionally, Ramp plans to allocate the funds towards acquisitions. The company has been actively acquiring AI-powered startups to expand its procurement offerings. Notable acquisitions include Venue, a startup focused on AI-powered solutions, and Cohere.io, a customer support tool. These acquisitions demonstrate Ramp’s commitment to incorporating AI at the application layer and leveraging it to provide innovative solutions to its customers.
With the recent funding round, Ramp’s team has grown to approximately 730 full-time employees, up from 495 a year ago. The company’s vision is to continue innovating in the fintech space and leveraging AI to optimize spend management for its diverse customer base.
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