Expense management startup Navan is cutting staff to achieve profitability ahead of delayed IPO

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Photo credit: jayk7/Getty Images

Navan, an expense management startup once known as TripActions, has laid off 5% of its staff, or 145 people, a spokesperson confirmed to TechCrunch today.

The information first brought the news.

“Navan has experienced strong growth over the last three years despite the challenges affecting our industry,” the spokesperson wrote by email, describing the cuts as a “restructuring.”

She added: “We are refocusing our efforts to move more quickly towards profitability as we enter the next phase of the business. That’s why we’ve made the difficult decision to reduce the size of our global workforce by 5% to increase operational efficiency as we continue to reinvent travel and cost through innovation.”

In October 2022, Navan secured $150 million in debt and raised $154 million in equity a post-money valuation of $9.2 billioncompared to the previous valuation of $7.5 billion.

This deal came weeks after the Palo Alto-based company reportedly confidentially filed to go public sometime this year at a valuation of $12 billion. In August, a source told Business Insider that the company was now aiming to go public in April 2024.

Navan once focused solely on managing travel expenses, but increased its overall expense management when this was the case at the start of the COVID-19 pandemic Revenue literally went to zero.

Since then, it has competed with companies like Ramp and Brex Integrating ChatGPT into your expense reports. Especially both ramp And Brex has expanded to include travel in recent years.

Navan has not disclosed its financials in the past, but earlier this year CEO and co-founder Ariel Cohen told TechCrunch Expense volume processed through Navan Expense increased more than three times in the first quarter of 2023 compared to the first quarter of 2022 – and 4.7 times when looking at the twelve consecutive months ending March 2023 compared to the twelve months before. In terms of sales, Navan said at the time that there had been a “three-fold year-on-year growth in sales.”

I also asked Cohen if Navan still planned to consider going public filed confidentially to do this in September last year. His answer: “I think at some point we will be a public company. We have raised approximately $1.4 billion so far and are ready to go public at maturity. In terms of growth, we are growing extremely quickly and many of our metrics would support being public. I don’t think the market is there right now.”

It is not uncommon for companies planning to go public to lay off staff, as such cost cutting is sometimes viewed favorably by the public markets.

Investors include Andreessen Horowitz, Base Partners, Elad Gil, Greenoaks Capital Management, Zeev Ventures, Lightspeed Ventures and Addition Ventures.

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