How Navan Built a $7Bn Fintech Inside a Travel Company, with President Michael Sindicich

Navan turned travel booking into a real-time payments business

Navan built a payments and expense business inside corporate travel. Each booking gets its own virtual card locked to one merchant, so reconciliation happens in real time instead of at month end, and about 90% of revenue comes from commissions, trip fees, licences and interchange. The pandemic arrived a week after the payments launch and wiped out revenue, pushing Navan to go on offense rather than shut down.

Takeaways

• One virtual card per booking. Navan issues a 16-digit virtual card for each trip, locked to a single merchant, so a $13.67 hotel charge matches a specific traveller's stay in real time. That replaces the ghost card and month-end reconciliation finance teams used before.
• Revenue is mostly transactional. About 90% of Navan's revenue comes from supplier commissions, a single trip fee per trip, expense management licences charged per active user per month, and card interchange, part of which is rebated to customers.
• AI lifts gross margins and cuts support load. Navan builds its own models because general ones are slower and less contextual. Average booking time is seven minutes against 45 on legacy tools, and Ava resolves over half of support interactions, lifting gross margins from 50% into the 70s.
• Navan tracks satisfaction ahead of revenue. Navan tracks NPS and CSAT ahead of revenue, reporting 96% CSAT and an NPS around 45 against roughly zero for traditional corporate travel tools. Its average customer saves about 15% of its travel budget, and Sindicich argues travel inflation exceeds reported CPI.
• Partner first, then acquire. Navan connects with a local travel company and checks that customers report good NPS and CSAT through the partner before deciding whether to acquire. It used this with SmartTrips in Brazil and Trippier in India, and says culture alignment matters most in M&A.
• IPO during a government shutdown. Navan was the first company to IPO during a U.S. government shutdown, moving its date two weeks earlier after preparing billboards and parties. The stock fell to $8. Ben Horowitz held an all-hands, and it recovered within a couple of months, faster than expected.

Navan's pandemic pivot

1. Navan launched its payments product in March 2020, and some of the largest companies in the country signed up on day one.
2. A week later the pandemic hit and all revenue went to zero. Much of Navan's people-heavy competition in travel management paused and furloughed staff.
3. The board weighed shuttering the company against going on the offense. Navan chose offense.
4. It raised money fast, doubled down on enterprise sales, moved its best engineers into payments and expense, and built COVID dashboards and employee tracking tools for admins.