How Navan Is Reinventing Business Travel (Ft. Ariel Cohen, CEO of Navan)

Yes.

Yes, we actually view ourselves as really making sure that this is happening. That the in-person connections that people are meeting for business, for any other thing. So, it's all about that. We are really from the day we started the company, we believe in this thing, the in-person connections, making sure that people can focus on that and not all of the things that are happening to you while you are traveling. So, in a very, very simple way, you can book your trips through us. We are managing it for your employer. You can expense, you can pay for your trips, but the entire idea is not to focus on this and really bringing you here.

Yes.

Yes.

Super, super easy to use. It is probably, you mentioned that you cover travel as well. It's probably the best product out there to plan, to book your trip, to support yourself when while you're on the go, and then when you're coming back, to just everything is easy. I'm talking about expense management.

And what your employer's budget is, right? Or your travel. That's because this is, so folks understand, this is an employer-led product, and employees are using. It's true. And something very unique about Navan is that we looked at this. We know that we need to sell it to a company.

But the person that we really care about is the employee that is traveling,

the EA, the executive assistant that somebody sometimes supports the execs, and then everybody that are involved in these things. So, we really, really believe that all of these people need to have really good product. We measure ourselves like a consumer brand. We care about NPS, CSAT. We assume that although the employee is being told to use that product, they have a choice.

So, we want them to love the product. And one of the main reasons that they love the product, it takes almost no time to book. In average, it's 7 minutes to book an entire business trip, which tends to be complex. When you want to change it, you're actually chatting with our with Eva, which is actually our AI bot that will support you in seconds, will change your entire trip. You're stuck in the airport, it will find a solution immediately. So, really really making sure that you'll be okay. And the expense management is completely automated. You're using our own credit card, you swipe it, it's all automated. Even if you decided not to use our credit card, we knew how to automate it. So, you basically we remove all of the stuff out of business travel. So, you love it. And you kind of mentioned the budget for companies.

So, we save in average for companies 15% on their entire travel budget. So, it actually means that if you spend $100 million a year on travel, we are saving you $15 million. It's a lot of money. But the way that we do it, we actually not having like these strict policies and all of these things. If you're willing to book below the company's budget, what the company was telling you to do, we're actually rewarding you

personal trips. So, you can later book your personal trip through us using this reward. So, that's how we save money.

So, we are actually supporting everybody from SMBs. We are a product led growth. So, you can be a company with 10 employees, 15 employees, we're going to support you. You can come to our website and start to using it. But we also supporting companies like Unilever and Netflix and Visa, pretty big companies that are out there. And because we focused on the individual, this product is relevant. It's the same product no matter you're a very small company or a very big company.

Yeah, first of all, I think that we have one, we're kind of known for this, one of the best sales teams in B2B. So, it's something that took us some time to build. And we have a fairly complex sale because the first person that will care about the travel budget is actually the CFO. It is a pretty big part of the P&L and especially the opex. So, it's distinct that you know CFOs will come and let's say there is some issue in this quarter. So, kind of the dumb way to do it is to do a travel freeze. The problem when you do these things is that, you're basically preventing your business from growing. You know, the people that are usually traveling are the sales people, are your execs, are your business development people. This is how you do an M&A. This is how you are hiring the next exec. So, CFOs care a lot about it. We sell to procurement as well because everybody do. There is sometimes in big companies a business travel team. So, it's an entire team. They care about policy, but they also care about safety, where their employees are. There is this concept of duty of care. You really need to know where your employees are and then help them if something happens. So, we do sell to this audience. But, and this is really, really important, we emphasize the travelers' experience. So, we emphasize that your sales team will be way more effective. And your employees will stop complaining about how hard it is to expense or how hard it is to book travel.

It's 100%. Like we reported last quarter that we grew the usage of the platform by 50% and our revenue by 40%. And we're a kind of a late-stage company. We're already public. We went public this year. Like, you know, our revenue is pretty high. So, to grow at that rate,

it means that companies are really fed up with what they're using today. And what they're using today is a combination of basically software from the '90s that is connected, you know, it's a workflow kind of software. It's kind of how people thought about stuff really ages ago. Connected to a travel agency. And this travel agency, you know, is not entirely connected well to this software. So, the employees are finding themselves, you know, just booking outside and doing whatever they want to. Or booking in the platform because they don't have a choice and then calling a travel agent, sending an email, fighting with the system. So, a lot of frustration. And the employees are actually coming to their employers and telling them, 'You know, I'm booking outside and I'm doing whatever I want to.' But then the company is losing control. Or I'm not using it. And that's really what drives Navan.

Yeah. First of all, you know, it's not just Anthropic, most of the AI companies out there are using us. OpenAI, Cursor, Anthropic, most of them. And there is a reason for that and it's kind of what I said at the beginning. Business travel is what drives your business. It's super important. Companies are spending a lot of money on it and they are also putting a lot of attention to it. So, if you are growing like the way that the AI grows today, you're going to travel and you're going to travel to a lot of different places and travel will be really important for you. So, that's the first thing before we even get to technology. The second thing, travel generally, but definitely corporate travel, is extremely complex and nuanced. You need to, if you want a global travel company, you need to be connected to everything everywhere. And connected means agreements with airlines, agreements with hotel chains, agreements with aggregators. To do that, by the way, to sell in the right place when I'm in London versus New York, you need to be incorporated, licensed, in London and in New York and everywhere on this planet. So, we actually built over the years, we call it Navan Cloud, the best travel platform on the planet. The connectivity that we have in the system is to everything. If it is out there, it could be a hotel that comes from Booking.com. It could be a low-cost carrier in India. It could be the bus in India. It's everything that is out there. We are supporting it. And then when you top it with what is very unique to Navan, our AI platform, it's a homegrown AI platform, you're making it super efficient. You have the employees really getting what they want to book. You have Eva that supports you. I'll talk later about Navan Edge which is our new product that is really our AI product. So, for any AI company like Anthropic to your point to build that, it's crazy, you know. Can you vibe code some nice UI to book your trip? Probably. Can you connect to all of this, make some sense into it, putting a corporate policy, putting you know a duty of care, all of these things? Super complicated. You know, if there was a way to vibe code it, I wouldn't have employed so many travel agents, operations people in corporate all over the world. And this is where Navan and you mentioned our share price or buy what the analysts and everybody that is following Navan are getting that we really created something unique in the AI industry, which is an orchestration between AI and when people need to intervene. So, when you chat with us to book your trip, it can start with AI. It can end with an agent. And it's completely seamless. It's not that you explain yourself again and again and again. Completely seamless. Supports the efficiency. Supports a unique pricing model. Supports our gross margins. You can see that we have tech gross margins while we are running a travel company.

Yeah, sure. Actually, R&D I think we are very efficient. We are running a lot of products in advance. So, we have our main travel product, what we are calling Navan Classic. We have our expense management product. We have our payments product, meeting and events, VIP. Each of these things, think about it like an Amazon. We have the traveler. The traveler is very loyal to us to use Navan for each of their traveler's needs. And we will keep giving them different products. All of them run through our AI kind of platform to give them the best thing that they need to have when they need us to hold their hand. This is kind of VIP C-level travel when they have their trip to New York from London to New York. When they have the next kind of big event. All of these things are actually product led. Usually have a lot of people involved in this. We changed it. Our gross margins actually last quarter were 75 and this thing is actually going trending up. So, super super efficient. So, I'm actually very happy with our R&D spent. And probably you'll see us continuing to add more products. So, much more investment in R&D.

So, we are always asking ourselves what is the next thing for that traveler. And when we started the company, we knew that we want to perfect the experience. But, without a GenAI, you can it can take you so far. So, we always had machine learning to kind of sort the search results correctly and really get to know you, personalize it for you. GenAI allowed us to, first of all, have a chat. But also know you. So, we have our own memory component. We have our own model. We know you. We know you on the level that we automatically creating your loyalty wallet. So, when you connect to Navan Edge, we're going to realize that you have this status in United Airlines, that status in Marriott, and then everything, you're coming and think about it you're like your assistant that will plan your trip with you. It's everything in your trip, like flights, car, hotels, restaurants, events, everything. It will tell you, 'Hey, I see that you have an excellent night in New York. Do you want us to find you a nice event? I see that our three other coworkers that are traveling with you. Do you want us to find you a restaurant?' So, it's really cutting-edge personal assistant. It is everybody can download it. You don't need to be a Navan customer. Your employer doesn't have to use us. So, it goes after what the industry is kind of calling going rogue is where the employee is basically saying, 'I'm not going to use this thing. You're not going to let me go because of it. So, I'm going to use the best thing for me out there.' And Navan Edge is really the best thing out there for you. It's kind of almost like whether you have a personal assistant or not, you now have.

Yes. So, actually regarding disruption, we're really disrupting the old model. So, we're disrupting these dinosaurs like Concur, American Express, CWT, all of these names. And they're irrelevant. You know, they didn't innovate for a very, very long time. They're giving a product that nobody likes. Usually, if we do that, somebody will disrupt you. What we are doing extremely well with the industry, we are working with the airlines to actually bring their product to our travelers in an extremely personalized way. So, it's something that actually airlines like. We are connecting to airlines directly, which is very unique for Navan. We are the leader on connecting the airlines directly, which allows them to really show you're sitting in a United business class Polaris versus Delta business class Delta One, and we can show you the difference. We will show you a picture. We're going to tell you this flight has a tendency to be late. This flight has a tendency to get canceled. You can only do these things if you're connected to the airlines directly and not using aggregators. So, there is a real win-win between the company that is saving money, the employee that is getting rewarded, that is getting the best service, the best product that is out there, and the airlines that can actually market the stuff to the company and to the employees in the most direct way possible. So, as a disruptor, we're really disrupting these people that are just irrelevant, but for the industry, we're actually not a disruptor. We are really working together to bring the best product to the customer.

Yeah, obviously I will not comment on these kind of things, but I will tell you what is the ambition of me and Elon. Elon is my co-founder. We want to build the biggest, the best global travel company.

We always acquired. The last few years we actually slowed it down a little bit. As you know, in a growth kind of startup, it was harder years to raise money, so we slowed it down. Now that we went public and we have an extremely strong balance sheet, you saw us already buying something in Brazil recently, like a month ago. You're going to see us buying more.

In Brazil. So, I mentioned earlier that travel is extremely complex. It is global. And there is huge sensitivity to inventory. So, let's say that I have a United Airlines agreement in New York. It doesn't mean that I have a United Airlines agreement in Brazil. It doesn't mean that I can buy you the United Airlines ticket with the right price, with the right service, with the right stuff around it. So, you see us over the years buy sometimes incorporating in locations, sometimes buying somebody there. But, it will always be somebody that's the case of Brazil that has the same similar concept of Navan. It will be online. It would be new. It would be very much user focused. So, what we bought there is a travel agency with a product that is very similar to Navan. This travel agency was already a partner of Navan. So, when we are servicing our customers in Brazil, it was actually through them. And now they're part of Navan. So, it means that companies that have employees in Brazil, companies that are established in Brazil will be able to use the Navan platform across the globe.

We are, you know, you can do it in advance. So, basically, you know, there are other platforms like Brex and Lamp that are doing that. We are never into let's be the next bank or ERP. What excites us is what I said at the beginning, to bring people together. And it's less about the ERP. It's less about let's be the office of the CEO. We are always excited about the trip. And when we, you're going to see us expand, it would be to more types of things that are happening while you travel. So, I've mentioned restaurants earlier. Your dinner is super important for us. Fairly new functionality in Navan. Booking your next event. I think that, you know, in the era of AI, when people will start to probably have more time, I think that you're going to see people care about in-person connections even more. You see people combining, we see it already for the last two to three years. People combining their personal trip with their business trip. It's called bleisure in the industry, but it's actually one of our fastest-growing kind of things, which is I'm going to London or Paris for the week, but I'm staying for the weekend. And we support both. So, you'll see us going much more into really building the best travel agency on the planet and much less towards the ERP side. So, can you pay for your phone bill through us or your marketing budget? The answer is yes, the functionality is there. It's not where Navan focus is. And in fact, Brex is a partner and there is a reason for that. When it goes much more towards there, we're sending them to Brex.

It will still be very much B2B driven. I think if I'm taking a 20-year view and I kind of mentioned that we always look at Navan kind of as Amazon for travel. That was on our seed round deck. We talked about it like that and it's still there. Eventually we want to, we have the traveler and if it's travel, we want them to think about Navan. It's simple as that. But in 5 years, I think you know, we started B2B. We are very strong in B2B. I think what is kind of making the line blurry is actually the employee. The traveler doesn't really think about it as I'm only doing my B2B. It actually started with execs. We noticed that execs are traveling a lot of times with their family and they want to, they would try to come and book it for five people but not like their co-workers but their family and they ask us where do we do that and we said, 'No, we are not supporting kids travel.' And then we started to ask them, 'Why do you need to have, you know, do you have kids working for you?' And they said, 'No, we need the CEO, the CFO family to join to the next trip.' And that's how we started to say, 'Oh, we actually need to support that combination of business trip and a personal trip.' And then we start to see that employees are doing it. That employees don't want to separate and you don't want to check out from your hotel on Friday and recheck yourself in because this is paid by the company and this is paid by you. So, we put this entire functionality there that is basically supporting a bleisure which is the same hotel booking but this part is being paid by your employers, this part is being paid by you but also your employer doesn't see that. You know, the first part of the trip the employer saw it but then it gets to privacy. You don't want to see the private part of it. So, I think you ask me about five years and I would even say it in 10 years. I think in 10 years people will really want to meet. It will almost be a reaction to the opposite that you see that organizations are becoming more efficient, more colder kind of thing. I really, I'm saying it all the time in the era of AI. I think that in person connections will be significantly more important. You kind of see it like with other kind of industry the wellness is getting stronger and stronger, spirituality is getting stronger and stronger. There is a reason for that. I think the reason is almost the opposite. And you know, sales people will continue to sell and meet. The entire organization will do that and we want to be there for them.

I think it's actually related to what I was saying. I think the lines are getting blurrier and blurrier between this is my corporate world and this is my kind of personal life, right? So I went to this AI conference 2 weeks ago in Paris. And it was completely like it was all of the companies from the US showing up in Paris. So I was asking myself, so why is it in Paris? Because it's Paris. It's exactly exactly because it's not Vegas. It's Paris. And there are people that like Vegas, but like if you kind of think about it, I want to really emphasize something else, something unique. You know, the opening dinner was in Versailles. And I think it was one of the first kind of private events in Versailles. And I was sitting there and I was looking around me and I was saying, 'Wow, there are all of these really AI companies that everybody is reading about them all day long. They're all sitting here in this conference, which is very very face-to-face, very much the opposite of AI agents, right? And all of them are excited to be there and this entire conference is very vibey. And then the last night of the conference there was a party. And we at Navan we are really really good at our parties. Like we love it. And I think there again there is a reason for that. It's actually if you are living in this, like you guys here in the office like people are here. It's like very different than what you see in kind of older companies. So I think this is where things are going.

Yeah, of course. I'll be happy to.