Fintech startup Ramp has reached a significant milestone, crossing $700 million in annualized revenue as of January this year, according to a source familiar with the company's internal operations. This marks a remarkable growth trajectory for the company, which had surpassed $100 million in annualized revenue before its third birthday in March 2022 and $300 million by August 2023.

Ramp's CEO and co-founder Eric Glyman shared that the company now accounts for "between 1-2% of the U.S. card market," an impressive feat for a young company. However, Glyman also acknowledged that this represents a small fraction of the market, leaving ample room for growth. Notably, the company has chosen not to prioritize profitability at this stage, instead reinvesting its revenue in research and development. According to Glyman, "over half of every dollar we spend on payroll goes into R&D," which sets Ramp apart from most software companies.

Ramp's ability to operate at a loss is facilitated by its substantial capital reserves. The company raised a $150 million Series D extension co-led by Khosla Ventures and Founders Fund last April, providing a comfortable cushion for its growth-oriented strategy. Interestingly, Glyman revealed that AI has been instrumental in reducing Ramp's cash burn to less than $2 million a month.

The company's AI-driven approach has permeated various aspects of its operations, from sales and marketing to product development and engineering. For instance, AI is helping sales development representatives book more meetings by pre-qualifying leads. Additionally, Ramp leveraged AI tools like Midjourney to rapidly test hundreds of iterations for its recent Super Bowl ad, which was produced in just 10 days from concept to completion.

In a separate development, Ramp announced on Monday that it has nearly doubled its valuation to $13 billion following a $150 million secondary share sale. This transaction saw new and existing investors, including VC Stripes, GIC, Avenir Growth, Thrive Capital, Khosla Ventures, General Catalyst, Lux Capital, 137 Ventures, and Definition Capital, purchase secondaries from employees and early investors. This marks a significant bump in valuation for Ramp, which was valued at $7.65 billion last April.

Ramp's growth has been accompanied by an expansion of its workforce, with the company crossing the 1,000 employee mark by the end of 2024. This represents a substantial increase from the 730 employees on board at the time of its raise last April. As Ramp continues to scale, its ability to balance growth with profitability will be closely watched by investors and industry observers alike.

The fintech startup's remarkable growth and valuation increase underscore the significant potential of AI-driven innovation in the financial services sector. As Ramp continues to push the boundaries of what is possible with AI, it will be fascinating to observe the company's future trajectory and the broader implications for the fintech industry.