Inside Brex and Ramp’s AI ambitions

Welcome back to The Interchange, where we look at the hottest fintech news of the past week. If you want to receive The Interchange directly in your inbox every Sunday, head over HERE to sign up! This week, we explore the AI ​​aspirations of management companies, and a recent boom in fintech in the UK.

AI ambitions

At one time, there was a running joke that every company could be a fintech. But now we have to think, every fintech will be an AI company?

This week, we report on Ramp’s new integration with Copilot, Microsoft’s brand of generative AI technologies. The expense management company says that now, Microsoft Teams users can use natural language to access Ramp’s intelligent AI assistant from their workspace.

trouble, ramp is not the first, or only, investment management company to use AI. Brex in September launched Brex Assistant, a flagship product of Brex AI. In addition to automating the collection of expense information, Brex Assistant can also do things like answer questions that employees routinely ask their finance teams, such as how much they are allowed to spend per day on an off-site location.

Brex co-CEO and co-founder Henrique Dubugras told TechCrunch + that he believes “this is only the beginning of the impact of AI in rethinking from scratch the employee and user experience.”

Earlier this year, Navan claimed to be the first travel company to integrate OpenAI and ChatGPT APIs across its entire infrastructure and product set.

The company says it uses generative AI technology to write, test and fix code with the goal of increasing its operational efficiency and reducing overhead. Also, through Ava — Navan’s virtual assistant — travel managers can personalize recommendations and increase engagement with travelers, executives claim.

One must wonder, however, if the use of AI is not only about improving the customer experience but also to improve companies’ bottom lines. It’s a valid question, especially considering reports that Brex is seeing slow growth (at just 1%, according to The Information) in the third quarter compared to the second.

While Brex declined to confirm The Information’s report that it saw annual revenue in the third quarter to $283 million, compared to $279 million in the second quarter and annual revenue of just under $200 million, one must take this information with a grain of salt. Brex likely saw a blowout related to the earnings event following the Silicon Valley Bank meltdown in March. So the fact that it’s slower in the third quarter feels less surprising than if a big event that gave it a surge in business didn’t happen. The revenue is higher compared to last year, and according to the company, so is the profit.

A spokesperson told me: “A look at our year-on-year growth tells a very different story and shows how Brex compares in this market. Year-to-date, three of Brex’s main revenue drivers (card revenue, deposit spread revenue, and Empower revenue) are growing materially and we’re seeing more than 80%+ YoY growth in gross revenue. Empower , the company’s software product, has seen revenue growth of nearly 50% this year, according to Brex.

The company, which was last valued at $12 billion, declined to comment on the timing of the IPO, which is rumored to be in 2025.

Last August, Ramp raised $300 million in a funding round led by existing backer Thrive Capital and new investor Sands Capital at a post-money valuation of $5.8 billion. At the time, the company said it exceeded $300 million in annual revenue.

Meanwhile, Navan IS reported generated $300 million in revenue in 2022. That company (formerly called TripActions) was last valued publicly at $9.2 billion.

Besides competing with each other, these companies compete with the likes of legacy providers like Concur and Expensify. So it’s no surprise that they all use AI to win over customers and make their operations more efficient. — Mary Ann

PS You can listen to Alex Wilhelm and I go deeper on the topic in the latest episode of Equity here:

An update on Wise

I just talked wisely CTO and interim CEO Harsh Sinha when he was in town for the grand opening of the new Austin office in the UK. If you haven’t heard, Wise – which is known for facilitating cross-border payments – is doing well right now. It recently reported that revenue grew 22% year-over-year in the fiscal second quarter – to about $314.7 million. It also saw its revenue increase by 51% year-over-year to about $420 million. The company has more than 5,000 employees worldwide, 180 of which are located in Austin, where it intends to increase its headcount by 50% in the next 12 months.

With 16 million customers, Wise has been profitable since 2017, before going public in 2021, according to Sinha.

Interestingly, Sinha believes that part of the company’s success lies in the fact that it “never gives the product away for free.”

“We believe that charging for your product is something you should do — even if it’s $1,” he told TechCrunch.

Sinha also shared how Wise has evolved over time by moving beyond facilitating cross-border transactions to give users the ability to hold/spend/send funds globally.

“Now you can hold 50 different currencies in Wise, and it works like an account product basically,” Sinha said. “You can pay your salary with it; you can pay your bills from it, you can do direct debits. And basically the suggestion for anyone who lives in multiple currencies with an international lifestyle.

He was also proud of the speed of Wise’s offering.

“An example of the way we move money around the world – you can do a transfer from us to Australia, and it hits the recipient’s account in less than 20 seconds. I challenge you to do that with ACH today,” said Sinha. “And we’ve done this by building a network that directly connects local payment systems around the world. And 57% of our payments now on the network are quick, less than 20 seconds. — Mary Ann

Weekly News

Reporter Manish Singh tells us about India’s central bank’s decision to implement several measures to slow the growth of consumer spending. The new measures are for unsecured personal loans, credit cards, consumer durable loans from banks and nonbanking financial companies. This comes as industry analysts report that 39% of retail loans made in the 2023 financial year went to borrowers with five or more active loans. Manish writes that this tightening will affect business startups in making loans. He spoke with a fintech founder who said it would reduce growth “a little bit.” Read more.

Journalist Tage Kene-Okafor writes about Paystack laying off 33 employees in Europe and Dubai amid the African payments company’s focus on its continent. Tage reports that the company maintains a footprint in Nigeria, Ghana, Kenya and South Africa and is currently engaged in private beta testing in Ivory Coast, Egypt and Rwanda as part of expansion efforts. Read more.

Editor Frederic Lardinois cut the term “FinOps” in an article this week featuring tech giants, including AWS, Microsoft, Google and Oracle, teaming up to make cloud spending more transparent. That’s because each SaaS platform has its own definitions and ways of doing it. Enter the FinOps Foundation, a movement aimed at creating a better framework for how cloud spending is tracked and reported. Read more.

Covered by editor Sarah Perez Venmo’s new feature that enables users to share costs between groups. What is interesting about it for groups, such as individual clubs, community organizations and even housemates, you can remove the spreadsheets you are currently using and instead track everything through Venmo. Everyone in the group can also manage expenses, so one person is not stuck on paper. Sarah points out that this new feature is likely to “cannibalize the user base of single-purpose applications that aim to organize group expenses, such as Divided.” Read more.

TC’s Tage Kene-Okafor reports that Chipper Cash recently announced an enhanced strategic partnership with Visa to drive growth and financial inclusion across the African continent. Having an established partnership with Visa since 2021 for card issuance, this expanded deal will see Chipper leverage Visa’s extensive experience and investment in several areas of its business such as product licensing and marketing. . “We are pleased to announce our expanded collaboration with Chipper Cash. This deepens our support of the growing demand for digital financial services in Africa and drives meaningful impact across the continent,” said Meagan Rabe, senior director of fintechs for Visa sub-Saharan Africa. “We look forward to continuing our work with Chipper Cash to innovate and expand the boundaries of financial access and convenience.” The announcement comes just two months after Chipper announced the launch of Chipper ID, the AI-driven verification and onboarding tool designed for the African continent.Read previous coverage of Chipper Cash here.

Some things we read:

ICYMI: Plaid has officially jumped into lending

Inside the battle between Square and Cash App on Dorsey’s Block

Businesses love rewards credit cards. This startup makes them easy ​​to launch (See TechCrunch’s previous coverage of Imprint’s $38 million round.)

Americans are being ‘taken’ by big banks, Robinhood CEO says. This comes as Robinhood raises the Robinhood Gold rate again to 5% APY on uninvested money.

Dwayne Johnson links up with Acorns for Mighty Oak debit card launch

Funding and M&A

As noted by TechCrunch:

Meet Tanda, your friendly neighborhood savings, lending network

Seen elsewhere:

Dwellsy’s first consumer rental search gets $11.5M seed round

Puzzle secures $30M for revolutionary AI-powered accounting platform

Happy Money announces new funding

Defacto: French fintech raises funding extension from Citi Ventures (Learn Defacto’s origin story and more in previous TechCrunch coverage.)

Image Credits: Bryce Durbin

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