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Ramp's Benjamin Alderman discusses:
Corporate spend management startup Ramp last month leapt into the travel management space with the launch of the Ramp for Travel tool, designed to let clients set policies and spending limits, monitor compliance and view data via a dashboard. Ramp head of partnerships Benjamin Alderman spoke with BTN executive editor Michael B. Baker about the company's plans for the travel space, its partnership strategy and the factors driving the recent surge of financial and fintech companies expanding their offerings in the travel space.
BTN: Who is the target customer for Ramp?
Benjamin Alderman: We do have technology-focused [small and midsize enterprises] in our platform, but we are much broader than that. One of our largest clients is a farm, believe it or not, so the breadth is pretty broad. That SME/midmarket space, the 50- to 500-employee range, is really where our sweet spot is. We have numerous clients outside of that, but that's really where we feel our overall offering resonates strongly.
BTN: What is your customer growth trajectory?
Alderman: Ramp was founded in 2019, and our trajectory has been really strong since then. We have over 4,000 clients on the platform now, and that is compounding growth.
BTN: Did you always plan to launch a travel-focused offering?
Alderman: Not to state the obvious, but the platform and Ramp offering was launched, and then [Covid-19] happened in the world, and travel wasn't really happening. We always knew that travel was an inherent part of what we need to do, especially when it comes to a key offering of ours: automating expense reports. We think about expense reports much more broadly than the traditional "I've been on a trip for business and have got receipts in my pocket," and the terrible process that's been in place for so many years. Travel, we always felt and knew, was going to be a core facet of what we did, so it's always been part of the strategy, but we do focus on providing different offerings in the market and—not being presumptuous—really listening to our clients. The need for travel during the early part of the company's growth wasn't there. Clients were asking for different things, but as things started to bounce back, that's when we really got to work.
BTN: What client response have you seen since the announcement of the travel solution?
Alderman: The response has been really strong. We knew, because we had solid client feedback on what we were building, so the uptake has been really positive from existing clients and prospects. Some of the most interesting feedback has been the acknowledgment that we looked at this holistically for business travel. Business travel to us is how all businesses think about travel, whether that's managed or unmanaged, and our solution is focused on enabling our clients to automate their finances as best they can, regardless of what channel or medium they use to travel.
The need for travel during the early part of the company's growth wasn't there. Clients were asking for different things, but as things started to bounce back, that's when we really got to work.”
BTN: How did you choose your initial partners for the travel offering?
Alderman: Our launch partners are [Flight Centre Travel Group's] Corporate Traveler and TravelPerk. There are few things we think about with partners. Our partnership thoughts are around who can do things for our platform and clients that improve and enhance it, which is a pretty obvious point for partnerships, but we look for partners that are pretty specific in how they match up from a tech-side perspective as well. A partnership has no longevity if the ethos isn't aligned.
Specifically, with Corporate Traveler and TravelPerk, from the beginning, we've felt that having both unmanaged and managed travel assisted through the platform is important, so having key partners that will work with us to provide invoices to automate the expense reporting process was absolutely key. Corporate Traveler and TravelPerk are two leaders in this space. They're complementary to Ramp's platform on both the macro-level of having managed travel options but they also are technology-leading players in the space that we are operating.
BTN: What about your other partners, Lyft and WeWork?
Alderman: Lyft and WeWork are fantastic partners, especially as business travel changes. The business travel that we had before is not going to be what we see in the future, and I think we all know that. If we think about group travel, that's something that WeWork can really do. Offices are shrinking and group travel is on the rise. Travel used to be centered on sales teams and sales executives, but with the remote workforce, there's going to be a lot more engineering teams getting together who may have been in the office and didn't travel historically.
With Lyft, the most important thing is, with rideshare being the most commonly expensed expense in terms of volume, automating that process so you don't have to go in and find your Lyft receipt, it's all approved within the company policy, and the industry doesn't have to touch that. We've historically spoken about expense reports as a necessity, but Ramp is making it so it's not, providing the controls for the individual traveler, meaning the finance team can be at peace with providing everyone with a card who is supposed to use it, and for the individual, once they do use it, that automatically flows through, and they don't have to touch it and spend four hours at the end of the month watching a wheel spin.
BTN: And this is presenting new challenges for travel managers as well.
Alderman: Literally, the way people travel is changing, from a ground transport perspective, be it individuals traveling or large groups. It's an important part in how we think about business travel moving forward and the definitions of that. That change is going to be really interesting to unfold, and the flexibility and control in our platform is really important for that. Even in managed travel programs, there's always been breakage. That's going to be exacerbated because the traveler profile has changed. It used to be that a large proportion of your workforce who traveled knew how to travel for the company, but that's going to change. For a lot of people, it will be their first time, or they'll be doing it irregularly, so making that as seamless as possible for that individual is really important. Coming out of this, a lot of companies are going to look at travel as a potential dissatisfier for individual employees who aren't used to it, or even those who are, and they need to make sure they are giving the employees the tools they need, as simple as possible, and not making one trip three hours of work.
BTN: What sort of future partners do you hope to have?
Alderman: Automating the expense report is key, so when we think about future partners, that's the key area of focus. How we gather that information and get that folio—to use that hotel example, but way beyond hotels, from air to car and ground transportation more broadly—and automate the expense report for the individual is vitally important. In terms of further partners, that is exactly where we'd like to focus in the travel space.
BTN: It seems like we've seen increased interest from the finance and fintech industry in the travel space of late. What is driving that?
Alderman: Travel and payments, both on the consumer of business side, have been hand-in-glove for many years. Even if you go back to the origins of AirPlus and American Express' travel programs and the stuff built in the 90s and early 2000s, the link between payments and travel, especially busines travel, has always been there. What you're seeing now is an exacerbation of that.
Both banks and fintech [companies] are seeing this is still a huge opportunity to improve on massive pain points. A lot of what happened with finance happens in the accounts payable department and in the background a bit, but with travel, it's every person who is traveling for that company and some even who aren't who are impacted by bad processes and bad offerings. There are different ways to do that. Some are through partnerships and acquisitions.
It will be interesting to see how they pan out. Some of the acquisitions that have happened, and one of the things I think about quite a lot, travel and finance, even though they are hand in glove, are very different industries. Any acquisition that anyone is looking at, you have to sit there and think about the cultural and the [go-to-market] fit. Travel and finance are different, but the synergies are so strong, some of the M&A activity in the market make sense, and some of them are down to the fact that, sadly, the travel industry has been hit so hard, there's good potential commercially from where they are now compared if you tried to buy that entity in 2019.
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