Earlier today current dog-parent Alex Konrad and fellow Forbes staffer Eliza Haverstock broke the information which Divvy, a Utah-based corporate spend unicorn, is considering selling itself to Bill.com to get a cost that could top $2 billion. For the fintech sector, it’s big news.
Corporate spend startups including Ramp and Brex are increasing rapid-fired rounds in ever-higher valuations and growing at venture-ready cadences. Their growth and its resulting private investment were earned by a popular approach to offering corporate cards, and, increasingly, the group’s ability to build software around those cards that took into account a greater section of the functionality that firms needed to track expenses, manage spend access, and, perhaps, save money.
The latter category was that which Ramp concentrated on when it launched. It worked. More recently Ramp added cost monitoring efforts to its own software package. And Brex, an early pioneer in its attempts to get corporate cards into the hands of smaller, and more nascent businesses, has also assembled its software attempts. So much so the firm, in conjunction using its huge recent fundraise, announced that it will begin offering an application package for a monthly fee.
Enter Bill.com. As the applications work in the corporate spend startups has improved, it may have begun cutting to the corporate obligations and cost applications classes. For Bill.com in the payments world, and Expensify in the investment world, that possible incursion could prove to be a growth-retarding concern. Therefore, it makes sense to see Bill.com opt to undertake the yet-private corporate spend startups which are enjoying the field; why not absorb an increasing customer base and fend off competitors in one move?
To get a better handle on the way the startups that compete with Divvy consider the deal, TechCrunch reached out to Ramp CEO Eric Glyman, also Brex CEO Henrique Dubugras. We’ll Begin with Glyman, that broadly agrees with our read of the situation: