How Does Divvy Make Money? Business Model of Divvy

How Does Divvy Make Money

Divvy is a popular financial management platform used by businesses for managing payments & subscriptions, building strategic budgets, and much more. Divvy’s mission is to empower businesses to more effectively handle their finances. By offering a set of tools that allow business owners to get near real-time reporting of their business transactions, create detailed budgets, and manage their cash flow, Divvy sought to eliminate the need for the countless hours spent on manual bookkeeping.

Launched in 2016, Divvy has built a strong reputation in the fintech world and is already working with leading brands in Silicon Valley. But how does Divvy make money? Well, this is what this article is all about. We’ll dive deeper into their business model and find out how Divvy generates revenue.

Divvy operates on a fintech transaction-based model for B2B. Divvy makes money by collecting a percentage of the interchange fees that merchants pay to credit card networks and banks every time a transaction is made.

So Divvy does not makes money from its customers, but from merchants that pay interchange fees. When customers make credit card transactions, the merchant has to pay a fee. When the merchant pays this fee, Divvy gets a portion. For example, if a merchant pays 2% to accept Visa credit cards, Divvy receives approximately 50% of that fee.

About Divvy

Divvy is a spend management solution platform for B2B that includes business credit, expense management, and spend management.

The idea behind Divvy is simple: business owners and managers need a way to monitor and control spending. They need a way to know what’s coming in and what’s going out, down to the penny. Divvy gives them that ability.



Business Model of Divvy

The business model for Divvy is a transaction-based fintech for B2B. This means that unlike for a SaaS, which is what many of Divvy’s competitor’s use, Divvy is totally free for their customers.

Divvy’s unorthodox business model is great for luring small businesses. Usually, corporate cards do not offer the high rewards of personal credit cards.

Divvy, however, in addition to deploying an unorthodox business model, also provides major credit-card perks:

  • Option to rack up points that can be redeemed for gift cards, travel or cash
  • Great reward rates

Divvy’s competitors include:

  • Ramp
  • Airbase
  • SAP Concur
  • Expensify
  • Brex
  • Emburse Certify Expense
  • Pleo
  • Bento for Business



As a spend management platform, Divvy provides solutions for spending, payment, and credit in regards to the B2B space. Within that space, there are various solutions depending on the business in question:

  • Small Business – For new businesses that have not too much history. They size usually from 1-20 employees.
  • Midsize Business – For more experienced businesses with between 21-500 employees.
  • Construction Companies – For construction companies looking to streamline budgeting and expense management processes.
  • Technology – For fast-paced software businesses that need a platform that can keep up with their growth.
  • Accounting Firms – To enable these companies to streamline the spend and expense management of their clients making life easier for you all parties.
  • E-commerce and Retail – To enable such companies to deploy uninterrupted advertising for their campaigns.
  • Healthcare Companies – To enable healthcare providers to increase control over their finances with minimal time investment.



Because PayPal Ventures is an investor, it is unlikely that Divvy is going to have trouble establishing notoriety. PayPal was, after all, the startup that made technopreneurs like Elon Musk and Peter Thiele famous.

In fact, Divvy has had no trouble attracting customers. More than 4,500 businesses have signed up including:

  • WordPress
  • Habitat for Humanity
  • Georgetown University

Divvy also markets through the following:

  • Blogging
  • Case studies



Divvy is fully digitized and does not have a lot of the expenses of a typical brick-and-mortar business. It still has the expenses that you would expect of any billion-dollar e-business:

  • Staff
  • Offices
  • Materials
  • Utilities
  • Security
  • Compliance

Because Divvy does not charge its customers a fee, its business model is not that of a SaaS. Regardless, it provides B2B software in the way that a SaaS would, so it would have the expenses of a typical SaaS:

  • Hosting
  • Payroll
  • Sales
  • Marketing


Plan for Profit

Divvy functions within a very active market, the corporate spend management space:

  • corporate cards
  • software that helps firms manage and limit expenses

This corporate spend management space is extremely active today due to the fact that businesses are seeking to modernize their financial infrastructure.

By focusing on this particular market space, Divvy hopes to eventually reach a profit. Divvy’s plan is to modernize financial processes by combining the following into a single platform:

  • Credit
  • Vendor management
  • Spend management

In order to get to this goal faster, Divvy plans to to invest heavily in the following:

  • product development
  • engineering

Founder and CEO Blake Murray has big ambitions for Divvy. He wants to replace established fintech services like Intuit’s QuickBooks accounting software and the American Express corporate card. He plans to make Divvy as indispensable as Salesforce features and new programs:

  • Customer billpay
  • Invoices from dashboard

Ultimately, Murray’s vision for Divvy is still close to the vision he had for Divvy when the idea to form a startup had first a entered his head back in 2015: “a fintech that could help small businesses kill the expense report”.


How Does Divvy Make Money?

Divvy makes money by sharing a portion of the underlying fee that merchants pay to banks and card companies on credit card purchases.

Divvy’s means of making money is different from expense-reporting competitors like Concur and Expensify, which charge a per-user, per-month fee. It is estimated by Forbes that Divvy receives half of the roughly 2% fee paid on every transaction.

That means that every time a Divvy customer makes a credit card transaction, that customer has to pay the merchant. Divvy gets a percentage from the merchant for each transaction, but the customer does not have to pay Divvy directly.

Divvy attracts the customers that make these transactions that make the money through a variety of products and features:

  • Business Credit
  • Spend Management
  • Expense Management
  • AP Automation
  • Credit Builder
  • Virtual Cards
  • Reimbursements
  • Rewards
  • Software Integrations
  • Mobile App
  • Reporting
  • Payment Services


Business Credit

Business Credit is quick and adaptable for SMBs and enterprise businesses. Users can apply for a credit line in minutes.


Spend Management

Spend Management has budgeting software that assists in taking control of one’s budgets and spending smarter.


Expense Management

Expense Management employs software that simplifies and streamlines one’s expenses.


AP Automation

AP Automation employs intelligent accounts payable software that reduces time spent on AP by 50%.


Credit Builder

Credit Builder is a a pay-as-you-go program for businesses that are in a situation that requires them to build credit.


Virtual Cards

Virtual Cards protect your business from fraud and overspending through their innovative feature, Divvy Virtual Cards.



Through Divvy’s reimbursements feature, businesses can within one system cover all of the following:

  • out-of-pocket expenses
  • card spend
  • reimbursements all in one system



The Rewards feature allows every Divvy customer to qualify to earn rewards from their card transactions.


Software Integrations

Divvy’s Software Integrations feature allows businesses to preserve their accounting processes with Divvy’s built-in software integrations.


Mobile App

Divvy is proud of their 4.7/5 rated Mobile App that brings budgets, virtual cards, and more into a single app.



Divvy’s reporting feature allows customers to catch abnormalities and keep their teams accountable with Divvy’s reporting tools.


Payment Services

Divvy has a free vendor payment solution that allows users to streamline their payables process.


Divvy Funding, Valuation, and Revenue

The funding for Divvy has a history of increasing exponentially.

In the time from the Seed round in 2017 to the Series B round in 2018, Divvy had quintupled in value from $7 million to $35 million.

Furthermore, in the time from their Series B round in 2018 to their Series C round in 2019, Divvy more than quintupled again from $35 million to $200 million.

Dec 13, 2017Seed$7 M
May 4, 2018Series A$10.5 M
Jul 24, 2018Series B$35 M
Apr 30, 2019Series C$200 M
Jan 5, 2021Series D$165 M

Notable investors include:

  • New Enterprise Associates
  • Pelion Venture Partners
  • Insight Partners
  • Jonathan Weiner
  • PayPal Ventures
  • Whale Rock Capital Management
  • Schonfeld Strategic Advisors
  • Hanaco Venture Capital
  • Acrew Capital


Divvy’s valuation is also increasing at a good rate. In the five months since the beginning of this year, Divvy’s valuation has climbed over 50%.

Jan 2021$ 1.6 B
May 2021$ 2.5 B

Part of this rapid increase within such a short time-frame is due to the fact that Divvy was bought out by is a Utah-based corporate spend management startup that competes with:

  • Brex
  • Ramp
  • Airbase

New Enterprise Associates managing partner Scott Sandell, who led the company’s most recent funding, summed up the Divvy phenomenon very well, “You can disrupt marketplaces very effectively with ‘free.”

Like its funding and valuation, the revenue increase of Divvy has been exponential. From 2018 to 2019, Divvy had more than quadrupled its revenue.

DateRevenue (Approximate)
2018$8 M
2019$32 M


Is Divvy Profitable?

Divvy is a financial platform and mobile app that helps small businesses with their expenses, billing, and cash flow. Divvy is not profitable yet, but they are getting close.

At least, that is what Forbes had to say about the company in 2020.

Regardless, the tone of Forbes was still complementary, addressing that Divvy’s revenue had more than quadrupled in the period from 2018 to 2019.

Back in 2020 before Divvy had reached unicorn status, Forbes had listed Divvy in Forbes most recent compilation of Next Billion-Dollar Startups.

What is also interesting is that completed the acquisition of Divvy in July of 2021. Like Divvy, also has a lack of profitability despite explosive revenue growth.

In fact, Motley Fool went so far as to describe’s profit story as “well and truly awful”. Consequently, the Motley Fool Stock Advisor has suggested ten stocks that are better buys than


Conclusion: How Does Divvy Make Money?

Now that we’ve looked at their business model, it’s time to wrap up. We hope it helped you to understand how Divvy makes money.

The company is changing the way organizations track expenses by providing instant insights into spending. Businesses of all sizes need to be able to track and understand their expenses and resources on a granular level — but up until now, the solutions available have been clunky and difficult to implement. That’s where Divvy came in.

To conclude, Divvy is an all-in-one solution to manage a company’s cash flow and budgets in real-time, eliminating time-consuming expense reports.

Thanks for taking the time to read this post. We hope you have enjoyed reading it. Please do not forget to share this article with your friends.

If you have any questions or suggestions, feel free to drop us an email. We would love to hear from you.

Have a nice day!

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