Sacra estimates Airbase hit $70M in revenue in 2023, growing 27% year-over-year, with a current valuation of $641.5M. The company has raised $251.5M in total funding to date.

Airbase generates revenue through a dual-stream model combining SaaS subscription fees and interchange revenue from corporate card spending. Unlike competitors Brex and Ramp who initially focused on free products monetized purely through interchange, Airbase deliberately targets mid-market companies (100+ employees) with a paid software-first approach.

The company's growth has been driven by strong product adoption among mid-market finance teams seeking comprehensive spend management solutions. In 2019-2020, Airbase grew revenue 4x year-over-year, demonstrating strong early market traction. Their enterprise-focused strategy has led to higher average contract values compared to SMB-focused competitors.

Airbase's customer base includes dozens of public companies and organizations with 1000+ employees. The company offers a free tier for smaller businesses but generates the majority of its revenue from paid enterprise subscriptions. While competitors focus on maximizing interchange revenue, Airbase returns most transaction fees to customers as cashback, betting on software fees as their primary revenue driver.

Airbase was founded in 2017 by Thejo Kote after experiencing spend management challenges at his previous company, Automatic.

Airbase found product-market fit as a comprehensive spend management platform for mid-market companies with over 100 employees, particularly those struggling with decentralized software purchasing and complex approval workflows.

The platform consolidates all company spending into a single system, starting with the initial purchase request through payment and reconciliation. When an employee needs to make a purchase, they submit a request through Airbase, which automatically routes it through the appropriate approval workflow based on factors like dollar amount, department, and vendor type. Once approved, Airbase facilitates payment through virtual cards, physical cards, or direct bill pay.

The core platform includes guided procurement for purchase requests and approvals, accounts payable automation for invoice processing and bill payments, and expense management with AI-powered receipt capture and categorization. For finance teams, Airbase provides real-time visibility into all company spend through integrations with accounting systems like NetSuite and QuickBooks.

A key differentiator is Airbase's ability to handle complex organizational structures, supporting multiple subsidiaries, currencies, and approval workflows while maintaining compliance through automated controls and documentation.

Airbase is a B2B SaaS company that provides comprehensive spend management software to mid-market and enterprise companies, primarily targeting organizations with over 100 employees. The company employs a dual revenue model combining software subscription fees with interchange revenue from corporate card transactions.

The core platform integrates corporate cards, bill payments, and expense management into a single system with automated workflows and controls. Airbase offers three tiers of service: Standard (up to 200 employees), Premium (up to 500 employees), and Enterprise (up to 10,000 employees), with annual contracts typically ranging from $42,000 to $230,000. Unlike competitors who rely primarily on interchange revenue and offer free software, Airbase deliberately charges for its software while returning most interchange revenue to customers through cash-back programs.

The company's land-and-expand strategy begins with basic spend management needs and grows through the addition of more sophisticated features like international payments, advanced approvals, and deep ERP integrations. This approach allows Airbase to start with smaller teams within an organization and expand as companies grow, particularly in the mid-market segment where companies need more robust controls and automation than basic corporate card solutions can provide.

Airbase operates in the corporate spend management market, which encompasses expense management, corporate cards, and accounts payable automation solutions for mid-market and enterprise companies.

Brex and Ramp lead this segment with a focus on corporate cards and free software, monetizing primarily through interchange fees. These companies initially targeted startups and SMBs but are expanding upmarket. Brex generates approximately $500M in annual revenue growing 50% year-over-year, while Ramp does $327M growing 98% annually. Both have raised significant venture funding to fuel their expansion into broader spend management.

Traditional players like SAP Concur dominate the enterprise segment with comprehensive expense management solutions. Coupa and Bill.com focus on procurement and accounts payable respectively, with Bill.com generating $642M in revenue (2022). These solutions typically charge substantial software fees and cater to complex organizational needs around approval workflows and compliance.

Divvy (acquired by Bill.com for $2.5B) and Teampay ($80M raised) target mid-market companies with hybrid approaches combining cards and software. Divvy focuses on smaller companies under 100 employees with a free product monetized through interchange, while Teampay emphasizes workflow automation and controls for larger organizations. This segment is characterized by companies attempting to balance sophisticated features with ease of implementation.

The market is trending toward consolidation of point solutions, with players expanding beyond their initial focus areas. Card-based players are adding software capabilities while traditional expense platforms integrate card issuing, creating increasing overlap between previously distinct segments.

Airbase has tailwinds from the shift toward decentralized corporate spending and digital B2B payments, with opportunities to expand into adjacent markets like international payments, enterprise resource planning, and full-stack financial operations software.

The explosion in decentralized software purchasing and remote work has created massive complexity in corporate spending. With employees increasingly making direct purchases, companies need sophisticated controls and automation. This trend has accelerated post-pandemic as organizations support distributed workforces and cloud-first operations. Airbase's core spend management platform is well-positioned to capture this $140B+ market.

Cross-border payments and multi-entity spend management represent a significant growth vector. Airbase has already launched international vendor payments to support globally-distributed teams. The company can expand deeper into areas like FX management, international expense policies, and consolidated global reporting - addressing pain points for mid-market companies operating across multiple geographies.

Airbase's workflow engine and approval systems position it to become the central nervous system for enterprise financial operations beyond just spend management. The company can expand into adjacent areas like accounts receivable automation, cash flow forecasting, and budgeting/planning tools. By serving as the single source of truth for all financial workflows and controls, Airbase could capture a meaningful portion of the $50B+ financial software market while increasing switching costs through deeper integration with customer operations.

Interchange revenue compression: Airbase's strategy of returning nearly all interchange revenue to customers as cashback creates pressure to rapidly convert free users to paid enterprise customers. While this aggressive move could help acquire customers, it eliminates a key revenue stream that competitors like Brex and Ramp rely on heavily. The company must achieve exceptional conversion rates to paid tiers to offset this strategic choice.

Mid-market positioning challenges: By targeting mid-market companies with 100+ employees rather than SMBs, Airbase faces longer sales cycles and more complex requirements around approval workflows and integrations. This positioning puts them in direct competition with established players like SAP Concur and Coupa, who have deep relationships and robust feature sets. The company must maintain rapid product development to match enterprise requirements while staying nimble enough to win against legacy vendors.

Integration dependency risk: Airbase's value proposition relies heavily on deep integrations with ERP, HRIS, and accounting systems. Changes to APIs or strategic shifts by key integration partners could disrupt core product functionality. The company's expansion into international payments increases this complexity, requiring maintenance of additional integrations across different geographies and banking systems.