Ramp just closed a stunning round at a $15 Billion valuation! Back in 2021 though, Ramp was just 2 years in — but already experiencing hypergrowth. Co-founder and CTO Karim Atiyah came to SaaStr Annual to share how they got this rocketship … off the ground.
From Parabus to Ramp: The Power of Asymmetric Bets
When Karim Atiyah, CTO and co-founder of Ramp, first arrived in the United States from Lebanon in 2007, he couldn’t have predicted he’d build not one but two successful startups in the fintech space. His journey from consultant to coder to fintech founder offers a masterclass in what he calls “asymmetric outcomes” — strategic bets where the potential upside dramatically outweighs the downside.
In 2014, Atiyah co-founded Parabus, a consumer-focused startup that automatically secured refunds when prices dropped on online purchases. At its peak, Parabus saved millions of dollars for its 10 million customers before being acquired by Capital One after just three years.
But it’s what came next that demonstrates the power of bigger, bolder bets. After spending two years at Capital One, Atiyah co-founded Ramp in 2019 — a business spend management platform that already achieved 100x the scale of Parabus in the same timeframe in just 2 years:
- $4 billion valuation
- $600 million in funding raised
- 170 employees
- 2,000+ businesses using the platform
The Asymmetric Outcome Framework: Why Bigger Bets Can Actually Be Less Risky
Atiyah challenges the conventional wisdom that minimizing risk leads to better outcomes. Instead, he advocates for a framework of asymmetric outcomes — making calculated bets where the potential rewards far outweigh the potential losses.
“It’s like playing poker,” Atiyah explains. “Even with a bad hand, if the potential reward is great enough, taking a risk can make mathematical sense.”
This framework can be applied across every aspect of building and scaling a company:
1. Market Selection: Tackle Problems with High Barriers to Entry
The financial services industry presents massive barriers to entry — most successful banks are centenarians, with some like Ax being over 160 years old. But this challenge also presents opportunity.
As second-time founders, Atiyah and his team raised an outsized seed round for Ramp, giving them the capital to tackle a space that most startups couldn’t touch. The higher the barriers, the fewer competitors — and potentially the bigger the outcome.
SaaStr Take: Don’t be afraid of markets with high barriers to entry. With the right funding and approach, these barriers can become your moat once you break through.
2. Hiring: Bet on Slope, Not Experience
Rather than hiring based on a comprehensive checklist of competencies, Atiyah recommends looking for “spiky” talent — individuals with exceptional abilities in specific areas, even if their overall profile seems uneven.
At Ramp, this meant bringing on people like:
- Veral: Who had previously sold a company to Apple
- Calvin: Who demonstrated extraordinary speed in building software
“We hired for potential and slope rather than just experience,” Atiyah notes. “These individuals scale with the company and can grow into 10x performers.”
SaaStr Take: Your early hires will define your company’s trajectory. Bet on exceptional potential over conventional experience, especially when you see evidence of an extraordinary growth rate.
3. Vendor Selection: Choose Partners Who Can Scale With You
The same asymmetric framework applies to selecting vendors. Instead of defaulting to the safe, established options, Atiyah suggests considering up-and-coming vendors that could grow alongside your business.
Notable examples from Ramp include:
- Choosing Linear for issue tracking over Jira, sacrificing some features for speed
- Working with smaller, scrappy vendors where they could build relationships and influence product direction
“Early-stage companies can take risks with smaller vendors because the switching cost is relatively low,” Atiyah explains. “But the upside can be tremendous, as we saw with companies like Shopify and Lyft betting on Stripe early.”
SaaStr Take: Sometimes the best vendor isn’t the one with the most features today, but the one moving fastest in the right direction.
4. Product Development: Make Bold Bets Based on Customer Problems
Ramp’s approach to product development focuses on understanding customer problems rather than implementing their suggested solutions.
“Listen to the problems, not the solutions,” Atiyah advises. “This allows you to make big, bold bets that can result in 10x products that alter your company’s trajectory.”
However, he also cautions about areas of “asymmetric negative risk” — especially in financial services:
- Be extremely careful with lending and credit decisions
- Isolate risky bets from areas that could impact customer satisfaction
- Create frameworks to determine where you can take risks versus where you need to be conservative
SaaStr Take: The biggest product innovations come from solving customer problems in ways they haven’t imagined yet. But identify where you can’t afford to fail, and be conservative there.
5. Fundraising: Optimize for the Long Game
When it comes to fundraising, Atiyah emphasizes that valuation is just one component of a successful raise. Far more important are:
- Clean terms: Avoid liquidation preferences, re-covenants, or giving up too many board seats early
- Reputable investors: Having a top-tier investor makes every subsequent fundraising conversation easier
- The long view: Think about all future rounds, not just the current one
One unexpected benefit of landing reputable investors is the access it provides to potential customers and angel investors who want to participate directly:
“We ended up with customers on our cap table who became our first beta users and advisors. That’s an incredible advantage.”
SaaStr Take: Your first institutional round sets the stage for everything that follows. Optimize for quality investors and clean terms over valuation.
Conclusion: The Counterintuitive Math of Big Bets
Atiyah’s core insight challenges conventional startup wisdom: bigger bets don’t have to be scarier. In fact, they can be less risky when you’re looking for asymmetric outcomes.
Ramp’s journey from zero to $4 billion in just three years demonstrates the power of this approach. By making calculated bets across market selection, hiring, vendor choices, product development, and fundraising, Atiyah and his team achieved what most founders only dream of — building a company that’s 100x larger than their previous success in the same timeframe.
The next time you’re faced with a decision, ask yourself: “Where’s the asymmetric opportunity here?” The answer might lead you to your biggest win yet.
