Companies are scaling faster today than at any point in history. Over at famed investment firm Andreessen Horowitz, they have dubbed this period “The Great Expansion.”
“Companies are going from zero to millions of users and surpassing $100M ARR [annualized recurring revenue] in less than two years—a growth trajectory unheard of before AI,” a16z’s Olivia Moore wrote last week.
One of the best examples of a startup with bonkers growth is corporate credit-card company Ramp. It has been hyperscaling since its inception; it was the fastest New York startup to ever reach billion-dollar unicorn status, hitting that mark within two years of its 2019 launch. At that time, it was on a $10 million revenue run rate (yes, that’s quite a high multiple on revenue).
One year later, Ramp’s revenue run rate jumped to $100 million. Recently, the startup announced exclusively in Fortune that it had surpassed $1 billion in annualized revenue, not long after achieving a sky-high $22.5 billion valuation in a recent round of financing.
Fortune‘s Leo Schwartz sat down with Ramp’s executive team, investors, and competitors to learn how it has…ramped up…so quickly. The result is Fortune‘s latest cover story.
I also sat down with Ramp CEO Eric Glyman at Fortune’s Brainstorm Tech conference last week to record a live episode of my Fortune 500 Titans and Disruptors of Industry vodcast.
During the interview, I asked him what he perceives as the conditions for this era of unprecedented startup growth. I also asked how he has scaled himself as CEO to meet the moment.
Glyman responded that he takes an always learning, always self-improving approach, calling on mentors like OpenAI’s Fidji Simo or Microsoft’s Satya Nadella when he needs advice. Often, he’ll try to mentally put himself out of a job, questioning his priorities and delegating to a more-than-capable team. You can watch the full video interview here or above, and subscribe to future episodes of Titans and Disruptors on Apple or Spotify.
Here’s some of what we discussed in our sit-down:
On Ramp’s explosive growth and valuation:
- How Ramp added more than $6 billion to its valuation in two months
- Why Glyman sees plenty of room for continued growth
- How maintaining a “sense of urgency” helps keep the company moving
- What makes the company irresistible to venture capital firms
On AI:
- How Ramp is using AI to automate tedious expense reports—and why he sees the technology freeing people from monotonous tasks at scale
- How AI is actually helping Ramp’s business as recent studies scrutinize the technology’s efficiency
- How Ramp is using AI to fight AI, particularly in cases of fraud
On readying himself to lead a fast-growing company:
- How Glyman has hyperscaled himself as a CEO, by focusing on his strengths and delegating to employees he trusts
- Why he relies on mentors like former Instacart CEO Fidji Simo and Microsoft CEO Satya Nadella for advice
Listen to the vodcast or read the transcript, which has been lightly edited for length and clarity, below.
Ramp’s explosive growth—how the company got there and how Glyman makes sense of it
Eric, thank you so much for being with us here today and at a big moment in time for Ramp. You are one of the hottest startups—you raised at a $16 billion valuation over the summer and then, like eight weeks later, raised at a $22.5 billion valuation. You just crossed $1 billion in annualized revenue, 45,000 customers.
But first I want to just talk about that number. You look at $1 billion in revenue and then a $22.5 billion valuation. Is the math mathing? Or are we in some valuation hype cycle? What is happening? How does that work?
I think Ramp is just growing so unbelievably quickly. Over the last year, we’ve just about doubled revenue. The fastest-growing public software companies, for reference, expect and hope to grow something like 20% to 30% over the next year. And so the velocity that we are growing at, combined with the scale of the company, is part of what’s getting investors so excited.
But beyond it, I think the unusual part is Ramp is actually growing even faster this year, and doing it while generating more cashflow than we did last year. And so when you combine that with the sheer scale of the market, there’s over $2 trillion spent in the United States on corporate and small-business cards. Which is just one of our markets, and we’re something like 1.5% of that market. It’s hard not to get excited about the potential ahead.
So hyperscale has been in your bones since the company’s pre-launch phase. You and your cofounder, Karim, sat down together and you said, we want to try and create a unicorn company, which is a $1 billion dollar valuation within 18 months. No company in New York had ever done that before.
Why such an ambitious goal? You manifested a billion-dollar company, because you did it within 18 months. And within two years, you had $100 million dollars in revenue run rate.
That’s exactly right. From two years—less than two years from incorporation—Ramp had been valued at not just $1 billion, but $1.5 [billion]. Within two years of the launch of the company, we surpassed $100 million in revenue. And just a few years later, last month, we passed over $1 billion in revenue. For us, I think it’s two things. First, you hit on this aspect of speed. We’re religious about it. We count the days. We’re 2,367 days old.
You know exactly how many days old Ramp is?
We do.
Why?
I think it creates this urgency. I think about leaders like Frank Slootman, who wrote Amp It Up, and just talks about the default state of an organization. Unless someone is driving and leaders are creating tempo, things slow to a halt. The expectation is, you decelerate, and it’s easy to say, you know what? Why not Monday instead of doing it on Friday? We want to instill that urgency to say, today is the only day 2,367 we’re going to have, we’re going to make it count. Also, when every day you’re thinking, What did we get done over the last 30 days? Over the last 60?, you can measure and you can start to make trade-offs and constraints.
You can say, when I look at these last months, these activities really mattered and moved us forward, let’s do more of those. And these other things, even though I liked them, were not as impactful. I have to say no to these things so we can grow faster. And so that’s a big part of it. The last important reason for us is that our whole mission is to help our customers spend less. We want the same for our own company.
What sets Ramp’s corporate credit cards apart
That’s kind of a novel idea, and I want to talk about that, too—the idea for Ramp, and explaining it to make sure everybody understands. It’s flipping the incentive structure on its head in the way that corporate credit cards have traditionally worked, where the more you spend, the more points you get, you’re encouraged to spend more. You actually want people to spend less, which actually seems like a bad business. Is that a business that’s viable?
Well, some of the largest companies in the world are in this line of business. You look at JPMorgan Chase, an over $800 billion company; American Express, a $230 billion company, proving that you can do great by getting people to spend. Now, I sold my last company to Capital One, and I learned how this industry worked, what made it great, but I found it so deeply strange that, at the core, customers were working to make the banks just a little bit worse off by gaming the rewards systems, and the banks were incentivized to go and devalue the reward system to convince people the points were worth a lot and then devalue it in the background. And we just thought, this is a massive opportunity.
Maeve Reiss
What if actually we wanted the same things as our customers, and what if our goal was not to go and give them the minimum points, but actually just help them spend less? You can compete on value. Not competing on price—who’s giving away more? And so I think that was the other motivation in attacking this industry. We believed, and we didn’t know if it would be us, but we thought at the end of the day, this is how the industry should settle. With companies working to make their customers better off and customers genuinely choosing the provider that’s helping them grow. And I think that’s been the big secret behind Ramp’s rapid growth.
So you were not the first startup in this space. There was another competitor, and still is another competitor, Brex, which has a valuation much lower than yours. But it was the first mover, I guess you could say. And at your point of launch, it was already a unicorn. So how have you just plotted along, despite having this big competitor in the space, taking venture capital away potentially, and you’ve just surpassed them frankly in all measures?
Yeah, we were accused a lot in our early days of being the second mover. We always thought we were the 150th mover in this. When you think about companies, most of the juggernauts in this country, they started 175 years ago. Their founders quite literally wore top hats. And so it didn’t bother us so much to come…
You need a top hat.
…we’ll work on it, we’ll talk with the styling team. But look, when we approached this industry, it didn’t bother us to come into this a little bit later. Our view was that this was a large industry that was not aligned with the end customers. And also when your founders maybe wore top hats, I think the importance of time isn’t something you’re thinking about every day. You’ve been around for as long as you’ve been alive, you’ll probably be around…and so what’s the hurry?
We looked at these great companies in the Valley. The Metas, the Ubers, that move fast, that create technology quickly. And it was so at odds with the financial institutions where, if you were transported back in time and had to use the bank accounts or the credit cards of 50 years ago, you’d probably be fine, but if you had to use the phones from 50 years ago, you and I couldn’t do our jobs.
And it just drove home that there was very little product innovation. And so one of the things we set out to do in starting Ramp was, we have got to be first aligned with our customer. [To] help them spend less, be more successful as a business, had to be priority number one. And then number two, we would try to build this valley-type like company that is iterating very quickly, that is measuring in days, that is shipping products every single day. We’ve shipped more products this year than there are business days, more features and announcements.
And the goal when you do that, is the experience of how much time the product saved just expands and compounds faster. And so we’re trying to catch up. What I think the financial services industry should have delivered over the last 50 years, we’re going to try to do it in just a handful, and actually make our customer’s businesses better, because it matters.
How Ramp is using AI—and if it’s working
You didn’t start out as an AI company, but would you say you’re an AI company now? How are you using it to make Ramp more efficient and your customers more efficient? Is it actually working in a measurable way?
For sure. So first, when you think about our customer base, we support over 45,000 companies of all shapes and sizes, from family farms to the Fortune 500. But for the majority, especially the small- and mid-sized businesses, they don’t have a single engineer at the company, let alone an engineer working to make their finance department modern, adopt AI, all of that. Here at Ramp, we spend over 50% of our payroll on R&D, on engineering, on data science, on design, all focused on integrating the latest and greatest technology. So that even if you’re a small business, you are benefiting from what’s happening in these research labs.
