Online payments company Stripe has returned to back US fintech Ramp for a third time in just under a year. The fast-growing start-up has just completed a $750 million (€679.5 million) investment that doubles its valuation to $8.1 billion (€7.25 billion).
The raise consists of $200 million in fresh equity alongside $550 million in debt. It brings total funding secured since it was founded to just over $1 billion.
Stripe's multiple investments come despite Ramp operating in an area in which it also has an interest, that of corporate cards. Stripe, founded by Patrick and John Collison, previously co-led a $115 million funding round for Ramp in April 2021. It then took part in a second $300 million investment in the company four months later.
Headquartered in New York, Ramp was established in March 2019 by Eric Glyman and Karim Atiyeh, who previously founded Paribus, a consumer finance start-up acquired by Capital One in 2016. The company has developed a corporate card that is built to save businesses money by analysing usage to help identify potential savings.
Founders Fund, a San Francisco-based venture capital fund, which has more than $6 billion in capital under management, returned to lead the latest round in Ramp. Its founders include Paypal co-founder Peter Thiel and Sean Parker, who co-founded Napster and was Facebook's first president.
Stripe, Iconiq, D1 Capital and Thrive Capital were among the other participants. The debt facility includes $300 million from Citibank and $150 from Goldman Sachs in a move that doubles the latter's commitment to $300 million.
The new financing will be used to better support businesses, continue technology investments, make acquisitions and roll out additional products.
With more than 5,000 businesses on the platform, Ramp saw its revenue grow close to tenfold in 2021. It is currently managing more than $5 billion of annualised payments volume on its platform.
“We are pursuing an extraordinary opportunity to overhaul an industry that historically has been misaligned and out of touch with the needs of its customers,” said Mr Glyman, Ramp’s chief executive.
“Since day one, Ramp has been designed to save our customers time and money, which is fuelling our rapid growth. We’ve delivered over $130 million in savings for our customers to date.
“We’re helping companies close their books in 8 hours instead of the industry median of 8 days – freeing up 3.5 million hours of manual work. None of our competitors can say the same. With this funding, we will continue to help even more businesses manage and finance their money easier, faster and smarter.”
Stripe introduced its own corporate card in 2019. Both it and Ramp were recently included in a prestigious ranking of the “most innovative companies in the world” by Fast Company. Stripe took the overall award, while Ramp was named the most innovative company in the finance sub-category.