This piece is in Tech Crunch and the focus is on the expanding players in spend management, which can be applied more broadly across corporate procurement, but is also often associated with card-related spend programs for T&E as well as the growing e-commerce space. Most readers will have picked up on the huge global B2B expenditures for goods and services, widely estimated to be over $100 trillion based on domestic and international trade values. We recently released member research on the card spend management space, where modern experiences are increasingly in demand. The author goes through a few of the recent developments.
‘If it feels like we’ve been over-indexing on expense/spend management news, it’s because there has just been so darn much of it….
Last week, I covered Brex’s big push into software, which means that its revenue generation will be more diversified as it will now be making money off of interchange fees and recurring revenue from subscriptions to its software. It also said it is placing greater emphasis on moving upmarket to serve larger customers…
As evidence of that, Brex revealed that DoorDash — a $36 billion in market cap company — was one of the first customers who’d taken a bet on its new spend management software product, Empower…
Coincidentally, the same day, Emburse — a nearly $200 million-in-ARR expense software company — announced it was doing the exact opposite. That company said it is making a big push into the SMB space and going head-to-head with fast-growing startups like Brex and Ramp…
The number of players in this space just keeps expanding, and one founder I spoke with — Zact CEO John Thomas — considers the sheer size of the B2B payments space to be the driving factor. The market is $25 trillion in the U.S. alone, with corporate cards making up 4%, or $1 trillion, of that total.’
The author goes on to discuss other various new entrants in the space, as well as the expansion into mid-market form the typical startup concentration on small businesses. To an extent, both have been underserved by traditional players, but that is changing as more fintechs wake up to the size of the revenue pool in the middle market firms and increase their capabilities for API-based integration with existing accounting and other critical internal systems, allowing interaction with broader spending channels. Many names are mentioned in the piece, but there are also lots of existing players in place, although many will have been more traditionally focused on larger market, so we’ll see where this goes.
‘While most of the players I talk to claim this is not a winner-takes-all space, it sure does feel like there is a lot of mud-slinging going on…
Meanwhile, London.-based Capital on Tap — a company that describes itself as a competitor to Ramp — told me that it has closed on a $200 million funding facility so that it can continue to fund SMBs. It has opened a new office in Atlanta to fuel its “explosive” U.S. growth. Capital on Tap says it has provided access to more than $5 billion of funding for more than 125,000 small and medium businesses across the U.S. and U.K…
So, let’s add one more to the list. Or shall I say, ring.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
