Dragoneer's Christian Jensen explains why Ramp at a $60B valuation makes sense: massive market, product moat, and rare growth acceleration

Speaker 2: Our next guest is Christian Jensen from Dragon Ear Investment Group. He's a partner and co head of Thrive Investment.

Speaker 1: Here he is.

Speaker 2: Welcome to the show. I I got one question. Did you just back the truck up for ramp?

Speaker 5: Yeah. I guess in some ways we did. But I mean, for all the reasons you guys... Did hear that? Did

Speaker 2: you hear that, John? What's that? Is that

Speaker 4: the sound of the truck backing up?

Speaker 5: If I can't get the gong, I'll take the truck.

Speaker 2: No. No. We'll get

Speaker 1: the gong.

Speaker 2: I'll come to

Speaker 4: the budget, bro.

Speaker 5: Thank you. Touched.

Speaker 1: That's awesome. Wonderful to have you on.

Speaker 2: So you led the $1,850,000,000 financing for ramp at a $60,000,000,000 valuation. Thrive Capital's in with you, Founders Fund, Sands Capital, Avenir. What... Yeah. What... Because you're... It's the first time on the show, maybe we should zoom out and talk about the overall strategy, how Ramp fits into it and your role at the firm.

Speaker 5: Yeah. So, hey, thank you for having me. I mean, what a treat. I can't believe Walter Isaacson here and Eric. This is, I mean, this is just awesome.

Speaker 1: He he opened for you. He opened for you. Yeah.

Speaker 5: Yeah. I'll tell I'll tell my wife that.

Speaker 1: He was like, I'm really... I I really get to open for Christian from Dragonair.

Speaker 5: Right. Yeah. Yeah. Exactly.

Speaker 3: I'll tell I'll tell Kate that.

Speaker 5: So I mean, who are we? We're a growth investment firm. We're based in The Presidio in San Francisco. We manage about $45,000,000,000 across publics and privates. And the whole philosophy of the place is concentrated bets in the in the businesses we think are are gonna define categories and and really be generational to businesses. We were founded around fifteen years ago. Mark's dad, my partner, our founder, he founded... I joined about ten years ago to help build on the success they were already having in privates, and I live around the corner. So I got three kids. Latest kid joined three weeks ago. So if I say anything stupid, there's my

Speaker 2: excuse. There we go. Congratulations.

Speaker 1: I've got

Speaker 5: a Thanks.

Speaker 1: I've got a five week old.

Speaker 5: Congrats on that.

Speaker 1: Same boat. We got nine...

Speaker 2: Nine kids

Speaker 1: on this between us. Imagine... It sounds like coming up. Yeah. Sounds like coming up. Gotta do that. I think so. Okay. First question. Everyone knows that Ramp is an incredibly unique special company. And... But at the same time, there's a lot of people that are otherwise pretty smart that say like, hey, Ramp at 60,000,000,000 on a few billion of revenue. That's that's crazy. Right? Like, if you've looked at like... And you can try to pull public comps and say like this thing would trade at, you know, a single digit revenue multiple blah blah blah. Like it's very easy to make the argument for why 60 is crazy and yet you just paid that price. I wanna hear from you why why why it would make sense to do it. I can make my own argument for it.

Speaker 2: But you're not crazy. They're crazy.

Speaker 1: Yeah. Yeah. I'm not crazy. They're crazy. No. I mean, there's a lot of... To me, it's like an applied AI company that is Yeah. Already working with tens of thousands of the most... Of the of the best customers that you can have in America. And they are in an incredibly unique position to deliver them, you know, super tangible products. They have incredible lock in, all these things. So I can make the case, but I want I want you to make the case.

Speaker 5: Yeah. So one, it's sort of a a universal truth for those, you know, if you if you didn't make the bet, then almost by definition, maybe you didn't think that the bet was worth making. Yeah. Maybe maybe you didn't have the chance to make it, but I know the feeling.

Speaker 2: And, you

Speaker 5: know, that's that's how we feel sometimes about those that we're not doing. Yeah. But it it comes down to sort of a handful of things in this case. Thing one is bonkers huge market. Like like, not just big, but, like, we might be in the first at bat of the first inning kinda big, and a growing market such that just the growth of this end market is several ramps in size annually. So, like Yeah. They don't really even need to be, like, taken, but we think they are taking market share, but

Speaker 2: they don't need to be in order

Speaker 5: to keep multiplying in size. So that's thing one. It's big, big market. Thing two, this product lead that they've built, you know, this platform. It's not just, you know, card and expense. It's actually about a dozen products now and keeps growing. And each one of those products that they add widens the moat. I mean, you guys met... You know, touched on this with Eric. Like, each incremental product means you can land with one more thing. One more thing the customer can say yes to.

Speaker 2: Yep.

Speaker 5: One more thing, you know, that they can upsell themselves or embrace later. It's... And which feeds this capital efficiency machine, which is wildly attractive. Like, for business to be accelerating at this scale with this kind of capital efficiency, it's very rare to see at this size. And the combination of accelerating growth, product lead, while still being so early in a market that they can go win is really, really rare. And the last thing, I mean, you just talked to him. It's Eric and the team around him and the culture they've built. And this this team is, like, this amazing learning machine. They're humble. They're hungry. They're ridiculously customer oriented. It... You know, it's just a team that keeps sort of surprising to the upside in all sorts of ways. And, you know, we find ourselves saying, like, we would want our, you know, our friends and our kids to go work for these... Like, we'd want to go work for these people. Like, it's the kind of team you want to back and it's... You know, you see that kind of goodwill with the customers all the time.

Speaker 1: Totally. Yeah. And I think it comes down to like Eric... In many ways Eric and Kareem leading from the front and being like two of the most AI held True. People that that I know. But going back like multiple years, like they've been on this, they've been, you know, sort of quietly recruiting like really elite talent, like Yeah. On the AI side, you know, they're they're And and just with that, it's like, it's so interesting being these, you know... You talked about the... Maybe the market being more positive some than than people might think. But if you're one of these legacy players and you're like, cool, we need an AI strategy, and then you're starting to think like, alright, well, let's make our, you know, let's let's make an annual plan. Let's like, you know, run a bunch of pilots. Let's test out a bunch of products, all these things. You end up just being a customer of AI, not somebody that is creating AI products that you can sell to other people. And I think that's just like wildly wildly different. And so you can imagine legacy players just being like their their products and their platforms effectively being pretty fixed in place and not adapting. Meanwhile, Eric and Kareem, you know, I know Kareem is probably like up all night riffing on riffing on product with the team and they ultimately are then shipping product very very very quickly and experimenting with their customers and I think that, oh, I just would I would absolutely hate to to be competing with them. No matter no matter how much no matter how much scale I had and and how and how much resources, it just sounds like an absolute nightmare.

Speaker 5: Yeah. I mean, there's some great other businesses in this space that have great brands and been around a long time and, you know, like, I mean, I think Amex, like, you know, it's like... It's more than a century old. They're they're great established brands, but we see how hard it is for businesses that even were born, you know, five years ago to embrace the new world. And and it's a challenge. And, you know, I think Ramp is setting an example for others to follow on how to do it.

Speaker 2: Last question for me and we'll let you get back to your day. I'm interested in like how you interface with the team coming in later stage growth investing. You're probably not pitching, I'll help you hire your first CTO or engineer. But is one of the value adds of working with Dragon Ear that that visibility in the public and private markets. I was listening to Brad Grossner on CNBC and, like, he has a lot of visibility into both sides. And so if the board meeting is gonna be about IPO timing, liquidity, how... Who's gonna get brought in at various points in time, is that something that you're spending a lot of time with the teams that you work with broadly on? Or are there other areas where you like to lean in?

Speaker 5: Yeah. It's good question. So thing one, we sort of start with the Hippocratic Oath. Like, start with do no harm. Like, don't get in the way. Don't bug them for stuff that doesn't help them. And that's an easy trap for investors to fall into, which is, you know, trying to be helpful and really just meddling. Thing two, when Walter Isaacson writes the book about Eric Lyman, it's not going to be, gosh, that late stage investor he had was like... It made all the difference. That was everything. So what we're trying to do is be helpful in the pockets where we can be helpful and where we should be helpful and where, like, we bring something a little bit incremental to the table. I will say with Ramp, this is one the things we love about them. They are really proactive at pulling help out of us.

Speaker 2: Yeah.

Speaker 5: Not just... Like, we've made a lot of customer introductions and not because we're, like, spamming Ramp. They're like, hey. Here's this one. Here's that one. Like, here's a few more. Like, help us. Help us. You know? And so they're great about it.

Speaker 2: That's awesome.

Speaker 5: And, yeah, sitting across both public and private, it does give us a little bit of a vantage point that's a little bit unusual, a little different compared to some of the earlier stage folks who they have helping, who I think are some of the best in the world at what they do at their stage two. And so, yeah, of course, we try and help in that area, but that's just one thing. You know, we're we're trying to keep our ears open and be helpful where we can be.

Speaker 2: Well, I think Mike Grimes made it into the Elon book, so maybe you gotta switch over to the sell side if you wanna get in biography. But...

Speaker 5: We shall see.

Speaker 2: But thanks so much for coming on the show. Have a great rest of

Speaker 1: your day. Yeah. Great to hang.

Speaker 2: And enjoy you know the the continuation of dad life with the new one.

Speaker 5: I appreciate that. You too. Five weeks. Gotta love it. Have fun guys.

Speaker 1: The best.

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