Ramp Secures $150M, Boosting Valuation to $7.65 Billion in Series D Extension

Ramp Secures $150M, Boosting Valuation to $7.65 Billion in Series D Extension
Image credit: Forbes

Spend management startup Ramp has raised an additional $150 million, elevating its post-money valuation to $7.65 billion.

This funding round was co-led by new investor Khosla Ventures and existing backer Founders Fund. Other participants included new investors Sequoia Capital, Greylock, and 8VC, along with existing investors: Thrive Capital, General Catalyst, Sands Capital, D1 Capital, Lux Capital, Iconiq Capital, Definition Capital, and Contrary Capital.

The recent raise extends Ramp’s Series D, following a $300 million investment at a 28% lower valuation of $5.8 billion. This brings Ramp's valuation closer to the $8.1 billion it achieved in March 2022. To date, Ramp has secured $1.2 billion in equity financing and $700 million in committed debt funding since its launch in 2019.

In March 2023, co-founder and CEO Eric Glyman reported a fourfold increase in revenue for 2022, driven by its bill pay segment, although the company was not yet profitable. Before its third anniversary in March 2022, Ramp surpassed $100 million in annualized revenue and later reached $300 million in annualized revenue.

While specific revenue figures for 2023 were not disclosed, Glyman mentioned that the startup's total purchase volume and revenue growth in the first quarter of this year outpaced the same period in 2023, despite a larger base.

Keith Rabois, who recently joined Khosla Ventures from Founders Fund, led the investment for Khosla. Despite Rabois' move, Founders Fund continued to participate in the financing. Glyman emphasized the deep relationship with Founders Fund, highlighting partners Napoleon Ta and Delian Asparouhov's involvement since Rabois' departure.

Glyman attributed part of Khosla's interest to Ramp’s focus on artificial intelligence (AI), noting Khosla's early investment in OpenAI. The new funding will be used to enhance AI capabilities to automate processes, provide deeper spending insights, and improve decision-making. Last November, Ramp integrated with Microsoft Copilot to further incorporate AI into its offerings.

Additionally, Ramp plans to use the funds for acquisitions. In January, Ramp acquired AI-powered startup Venue to expand its procurement services. This follows previous acquisitions, including Buyer in August 2021 and Cohere.io last year, both aimed at enhancing its platform.

Ramp, serving over 25,000 companies across various industries, has grown to approximately 730 full-time employees, up from 495 a year ago. Venture-backed startups represent a minority of its customer base, which also includes farms, shops, hospitals, and nonprofits.