Ramp and Brex draw diverging market plans with M&A strategies –

Earlier today, expenses Management startup Ramp said it has raised a $300 million Series C, valued at $3.9 billion. It also said it was acquiring Bayer, a “conversation-as-a-service” platform it believes will help customers buy and save money on SaaS products.

The round and deal was announced just a week after rival Brex shared news of its own acquisition – a $50 million purchase of Israeli fintech startup Weave. The deal was made after the founders of Brex invested in Weave, which provides a “universal API for commerce platforms”.

From a high level, all the recent deals in corporate cards and expense management show that it’s not enough to help companies track what employees are spending these days. As the market matures and feature sets begin to converge, players are trying to differentiate themselves from the competition.

But what’s of interest here is that these deals can tell us where both companies think they can deliver and extract the most value from the market.

These differences come on top of another layer of divergence between the two companies: While Brex has established a paid software tier of its service, Ramp has not.

earn more by spending less

Let’s start with the ramp. Launched in 2019, the company is a relative newcomer in the expense management category. But by all accounts, it’s generating some impressive growth numbers. As our colleague Mary Ann Azevedo wrote:

Since early 2021, the company says it has seen a 5-fold increase in the number of cardholders on its platform, with more than 2,000 businesses currently using Ramp as their “primary expense management solution.” Transaction volume on its corporate cards has tripled since April, when its last increase was announced. And, impressively, according to CEO and co-founder Eric Glyman, Ramp has seen its transaction volume increase by 1,000% year over year.

Ramp’s focus has always been on helping its customers save money: it offers a 1.5% cash back reward for all purchases made through its card, and says its dashboard helps businesses avoid duplicate subscriptions and license redundancies. Helps in identification. Ramp also alerts customers when they can save money on annual versus monthly subscriptions, which he says has prompted many customers to shun established T&E platforms like Concur or Expensify.

All told, the company claims that the average customer saves 3.3% per year on spending after switching to its platform — and that’s before it even brings the buyer into the fold.

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