Ramp, which offers spend management software and corporate cards, announced that it raised $115M in two investments on Monday.
The second investment took the company’s worth to $1.6 billion. The company raised the capital in two rounds. D1 Capital Partners led the first round. It raised $65 million in this round, and the company’s valuation reached $1.1 billion. In the second round, Ramp raised $50 million, and the company's worth reached $1.6 billion. Stripe led the second round. Stripe is an online payment giant.
Ramp offers enterprise content delivery network solutions. Founded by Alex Laats, the company has its headquarters in Boston, Massachusetts, United States. It is established in order to make streaming videos for business communications. Their software allows uninterrupted and unlimited enterprise video streaming. Some other products of the company are OmniCache, the Altimeter, and the Multicast+.
Stripe is an Irish-American company.Established in 2009 as a software as a service (SaaS) and financial services company, the company has its headquarters in San Francisco, United States, as well as Dublin, Ireland. It mainly provides application programming interfaces (APIs) and payment processing software for mobile applications and e-commerce websites.
Eric Glyman, the CEO of Ramp, claimed different investment groups could have different assessments about the company’s worth.
As per a source, Stripe most probably saw Ramp’s increasing business expansion and wanted to invest in it but had a larger amount as D1 had already made its move by investing in round 1.
Ramp’s recent fundraising is far more than its last fundraising round. It raised $30 million in December 2020. The company rose once in 2019 and two times in 2020. Lately, it got a $150 million credit facility from its corporate customers to support growing spending volume.
It offers corporate cards to its customers wrapped in software. This allows companies to monitor and handle their total spending. The company is about to reach a transaction rate of $1 billion real soon. The formula used was multiplying one month’s volume with 12, an effective method to calculate the figure. There is an increase of about 400% in the spend rate of the company within the past six months.
Ramp’s debt, valuation, and capital which it has managed so far in 2021, may help it swim through competitive waters. Its competitors, such as Brex, Airbase, Divvy, TeamPay and many others, are also well-fed, with the capital eagerly waiting for the whole corporate world.
The company, just like its competitors, earns when it collects a small piece of customer spend as revenue through interchange incomes. Glyman was asked if the company has any plans in the near future to charge for the software it currently provides free of cost to its customers, just like its competitors do. But, the CEO didn’t answer this one.