01:20:11 · Eric Glyman, Jordi Hays, John Coogan
It's like who can write great copy, who can think of funny ideas, how can we take an idea to you know, we're we're doing it tomorrow. And I I I think that you guys have have really lived. I mean, feel forget a year ago, TBPN. I I don't even think you guys were called TBPN, or was it? You know, you've turned into something great. And so I I I I feel strongly you guys don't have trouble with this, and I I think just emphasis on speed and quality and craft has been what I've seen Yeah. With you guys. [01:20:38] S1: No. Totally. Something I was thinking about, we were reading that Karpathy post earlier around how software one point o was, like, kind of more general automation. Software two point o is your automating tasks that are verifiable. Verifiable tasks. And I just feel like finance is, like, just, like, prime for verifiability. Right? Because it's like, well, was this in in the policy or outside of the policy. Right? So Totally. [01:21:05] S0: Yeah. I'd I'd love to know Or
01:21:05 · John Coogan, Eric Glyman
[01:21:05] S0: Yeah. I'd I'd love to know Or [01:21:07] S7: is your policy incomplete. Right? You know, there's all these practices, and you can actually start to learn based off of the actions. And I think something that's so unique is that every time, you know, months close, there is someone actually going in and saying this transaction is categorized here. This goes there. You can see if you grew your revenue faster, if you grew your cash flow faster, or if you didn't. And so there's this incredible feedback loop that allows, ramp to add more value. And we think that's why the average, customer that adopts ramp spends 5% less. And also, the median Ramp customer grew their revenue by 12% over the past year, which is much faster than the median in The U. S. And I think a lot of it comes from this learning. [01:21:53] S0: So help me understand. You're generating cash, but you're also raising money. You're implementing AI, which can be very expensive. We've heard from Ivan at Notion that he saw a slight hit to his gross margins. It's still fantastic business, but did actually see that show up in the income statement. How is how are you thinking about the adoption of AI as a piece of the tech stack? Is it actually reshaping the financials at this point? Or is it something where, you see it sort of just like another subscription, just like another piece of the tech stack, and it hasn't really changed the way you think about the cost structure of your business?
01:22:41 · Eric Glyman, John Coogan
[01:22:41] S7: It's a really good question to zoom into. And in in my general view, it's been fairly overwhelmingly positive. I mean, I I still think that for us, the the goal is, you know, our goal is not to sell someone like a card or a bill payment software. It's to, it's help your business run more profitably. Right? And, I I think a lot of what we're trying to do is if we can actually pay for software where the output is, there's an hour of your, of your time, that you don't of work you don't have to do, anymore, that's somebody's software, that's really great. Next, I think about and you ask most, founders or or leaders in in technology, like, the biggest constraint on your business? Everyone says, I'm having trouble hiring engineers. Yeah. It it's like, I I wanna hire great salespeople, great engineers. And and if you can adopt software I mean, we look at our sales team. You know, the quota that folks on the sales team have is multiple times of our NexLocest competitor in part because we have a lot of tools we built to make our team, far more productive. Our engineers, are shipping about 50% more, code to the codebase than about four or five months ago, and that's continued. And so our general view is, look. If you can actually make the best even better, that's something we're gladly willing to pay for. And so in in our business, we've actually seen, you know, margins expand as we've, adopted this, in part because we think that our our principles, let's create a lot more value than we capture. [01:24:10] S0: Yeah.
01:24:10 · John Coogan, Eric Glyman, Jordi Hays
[01:24:10] S0: Yeah. [01:24:10] S7: And and we're able to do that because we're we're creating much more value Yeah. Than it did even months ago. [01:24:15] S0: Hopefully, that's like Ramp is agile, new company that people love the product. And so it's just so much easier to say, hey. If you want a new AI powered feature, we have that on day one. You don't need to rip us out and go to something else. You don't need to have some bolt on. You can just get it all here. And so you can effectively, like, monetize whatever cost is coming through the actual token generation on your side pretty quickly. [01:24:43] S1: How how do you how are you thinking about head headcount planning over the next few years? We don't have to zoom out to, like, ten years. I think it gets extremely Yeah. Extremely fuzzy. But I'm curious if you care about, you know, every every once in a while, these sort of like revenue per employee or or sort of like net income per employee, like statistics start floating around. I'm curious if you if you if you think about that at all. And and obviously, professor, you know, running running ramp as, you know, one of the most efficient companies in the world is really good marketing for the products. It's probably the best marketing that you can do. But I'm curious how you think about about those things.
01:24:43 · Jordi Hays, Eric Glyman, Luca Ferrari
[01:24:43] S1: How how do you how are you thinking about head headcount planning over the next few years? We don't have to zoom out to, like, ten years. I think it gets extremely Yeah. Extremely fuzzy. But I'm curious if you care about, you know, every every once in a while, these sort of like revenue per employee or or sort of like net income per employee, like statistics start floating around. I'm curious if you if you if you think about that at all. And and obviously, professor, you know, running running ramp as, you know, one of the most efficient companies in the world is really good marketing for the products. It's probably the best marketing that you can do. But I'm curious how you think about about those things. [01:25:26] S7: It's exactly the right question. Because I I I think look. When we kind of think about our operating model every year, we try to increase the ratio of whether it's revenue, contribution profit, margin per employee. It's it's all to say, like, we we anticipate revenue is gonna grow very, very rapidly. And while employee headcount is gonna grow, it's gonna grow a little bit slower. And so the effect is you you start to see this widening. It gives you more margin to, invest in, whether it's, use of AI itself that you can drive into the product, more marketing, all those types of things to reach more customers. I I think more abstractly, though, if you kinda step back, you know, most businesses in The US run are actually profitable. You might forget that in the Valley, but have [01:26:13] S5: an 8% profit margin.
01:26:13 · Luca Ferrari, Eric Glyman
[01:26:13] S5: an 8% profit margin. [01:26:16] S7: And What are costs? We'll talk about this. But, you know, it's like, if you make a company more efficient by, like, 1%, it's equivalent to, like, an increase of you know, $1 in savings is equivalent to $12 more in revenue at an 8% margin just mathematically. And if you can do this repeatedly, I actually think that there's you know, a, you have a lot more businesses that are good, but but don't have this automation and and and and skill sets to grow much larger. I think a lot more companies will get bigger. And I also think that if it's just easier to run a business, I think more great businesses will get started. I think there's a lot of creative people out there, who would be running organizations who, I think, as the tools to build get easier, you see a more interesting world. And and so, you know, I I I actually think it's it's a pretty important and really profound thing to knock out inefficiency to allow, smaller companies to succeed. I mean, even you guys are a perfect example. TPPN is a small team that's changed the media landscape and captivated the world. And, like, I think that there are probably a lot of people where if you make the tools better, like, they will come.