Ramp Secures $300 Million In Funding In A Round Co-Led By Thrive Capital And Sands Capital

Ramp, a fintech startup company, has secured $300 million in funding. The funding was generated in a round by Thrive Capital and Sands Capital. The funding round happened at a valuation of $5.8 billion.

Ramp raises $300 million in a funding round

A report by The Information had earlier confirmed this funding round saying the company intended to raise “several hundred million dollars.” In March last year, the company had raised $200 million in equity funding at an $8.1 billion valuation. The company has now raised $970 million in equity funding and $700 million in debt funding.

The other investors participating in this funding round include General Catalyst, Founders Fund, and other existing investors. Ramp plans to use the amount raised in this funding round to boost product development and expand into other areas. It also plans to undergo recruitment during the year’s second half.

Ramp has severally expressed its desire to achieve growth in customers and products. In June, TechCrunch posted the acquisition of Cohere.io, which created an AI-powered customer support platform. Earlier this month, it announced its entry into the procurement industry to focus on more areas.

Ramp has continued to expand its offerings over the years. The company started operating as a corporate card startup before integrating other features like vendor management, bill payment, and travel expense management.

The startup initially focused its operations on small and medium-sized businesses, but it has since shifted its operations to work with businesses of all sizes. By early August, over 15,000 firms used Ramp, a significant increase from the 5,000 reported in March last year.

$300M raise amid declining fintech funding

Ramp is not the only fintech startup that has posted a drop in valuation in the last 18 months. Many fintechs have published a poor financial outlook this year amid escalating global tensions and increasing interest rates. The plunge in Ramp’s valuation was expected as, in July, analysts had estimated the company to be worth $4.8 billion.

Nevertheless, the funding is significant for the company, as fintech funding globally has dropped in the first half of the year, according to a report by KPMG. Investors have refrained from investing in fintechs because of economic uncertainty. A report by CB Insights also noted that fintech funding dropped by almost half to $7.8 billion.

In March, the co-founder and CEO of the company, Eric Glyman, noted that the company had posted a 4x growth last year. This growth was seen mainly in the bill payments segment, but the firm was yet to achieve profitability.

By March 2022, Ramp saw its annualized revenue surpass the $100 million mark. The company now says it has exceeded $300 million in annualized revenue. At the time, the company’s CEO noted that the startup had most of the equity funds received from investors in its balance sheet, boosting its liquidity significantly.