# Rippling (Series B) Financial Model Rippling is an all-in-one workforce platform that centralizes employee data across Payroll, Benefits, IT (Computers & Security), and Apps & Access. - Canonical: https://finamodel.com/startups/rippling-series-b - Excel download: https://finamodel.com/startup-models/rippling-series-b.xlsx - Category: Enterprise/Security - Model type: Unit-economics / DTC - Funding round: Series B - Funding: $145M - Founded: 2020 - Geography: US HQ (San Francisco, CA); engineering in Bangalore, India. [DECK slide 5] - Customer: B2B ## About the company Rippling's Series B materials describe an all-in-one workforce platform covering payroll, benefits, IT computers and security, and apps and access. The shared employee-data foundation is intended to replace fragmented point solutions. The company sells per-employee subscriptions across multiple product lines and can expand accounts through cross-sell and reseller relationships. Its own cohort framing emphasises net expansion as a key source of value after the initial customer win. The model tracks ARR by product and customer segment, separating new logos from expansion, churn, and reseller-sourced revenue. Employees covered, PEPM pricing, module attach, sales capacity, gross margin, onboarding, and operating costs drive the financial plan. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition - Single system of record for employee data; any employee lifecycle event (hire, promotion, offboard, location change, etc.) automatically propagates across Payroll, Benefits, Computers & Security, and Apps & Access. - Four product lines: (1) Payroll, (2) Benefits, (3) Computers & Security (IT/MDM), (4) Apps & Access (SSO/provisioning). - ARR product mix (approximate from pie chart, slide 4): IT largest slice (~30%), Core HRIS (~25%), Payroll (~20%), Benefits (~15%), Reseller (~10%). - note: exact percentages not labeled; visual estimates only. - Customer ratings: 4.9 stars on Software Advice, G2 Crowd, and Capterra; PC Mag Editor's Choice 2019. ## Revenue model - Multi-product SaaS; revenue described as "Total Bookings ARR." - Product lines each carry separate ARR; cross-sell is an explicit revenue motion (shown as a bookings component in the template slides). - Reseller channel present as a distinct ARR category. - Customers span SMB and Mid-Market segments; ARR Mix by Segment donut chart shows MM is the larger slice. - Industry mix: Non-Tech customers appear to be a larger share than Tech (from stacked bar, slide 5). - Specific pricing ($/employee/month) not disclosed in deck. ## Traction & metrics - ARR: "Double Digit Millions" - bar chart shows consistent month-over-month growth with steep upward slope to current period. No precise figure given; note states "Financial figures in this document are under review and subject to change." - Customer count: "Several thousand customers across diverse industries." - Employees: ~250. - Investors (prior rounds): Kleiner Perkins, Y Combinator, Threshold, Initialized Capital. **Important caveat:** Slides 6–14 are explicitly labeled "Illustrative numbers shown, not actuals" and use "[Acme Company]" placeholder branding. These are a SaaS metrics template Rippling included to show investors how they would present metrics - NOT real Rippling data. The illustrative figures below are included for model structure reference only, not as factual inputs: - Illustrative total ARR: $2.0M (June 2020) [template] - disregard as actual; real ARR is "Double Digit Millions." - Illustrative 12-month ARR growth: 3.0x [template] - Illustrative Magic Number: 1.0 [template] - Illustrative Net Dollar Retention: 120% (illustrative key metric) / 125–160% range shown in illustrative charts [template] - Illustrative Gross Margin: 85% [template] - Illustrative Quick Ratio: 8–10x range [template] ## Unit economics All figures from slides 7–14 are illustrative only (see §5 caveat). No real unit economics disclosed. - Cash-on-cash sales payback: The deck defines this as monthly cash-in from sales / monthly sales headcount expense. Illustrative target ratio shown is 1.0x (reps pay for themselves in month zero). - Gross Margin: 85% [illustrative only, slide 7] - Magic Number definition: (current quarter estimated revenue − prior quarter revenue, annualized) / prior quarter S&M expense. Illustrative values ~1.0–1.2x. [slide 12 - illustrative] - Net Dollar Retention definition: Total Bookings ARR for cohort (after expansion, contraction, cross-sell, churn) in current period / same cohort ARR 12 months prior. Illustrative estimate ~125% for new cohorts. [slide 14 - illustrative] ## Competition / moat Inferred from product framing: Rippling positions against fragmented point solutions (separate payroll, HRIS, MDM, and SSO tools). The moat is the centralized employee data layer - workflow automation triggered by a single source of truth. ## Team & funding ask / use of funds - Offices: San Francisco (HQ), Bangalore. - Headcount: ~250 employees. - Existing investors: Kleiner Perkins, Y Combinator, Threshold, Initialized Capital. - Founder / executive team: Referenced via link ("Meet Our Executive Team") but not named in slides. --- ## Recommended financial model - **Archetype + why:** Multi-product B2B SaaS ARR model with per-employee-per-month (PEPM) unit economics. Rippling has four distinct product lines each with separate ARR, a cross-sell expansion motion, and a reseller channel - the model must track ARR by product/segment and net expansion separately from new logo ARR. A cohort-based NDR expansion layer is explicitly how Rippling thinks about growth (evidenced by the illustrative slides showing this exact framework). - **Forecast horizon & granularity:** Monthly for Year 1–2; quarterly for Year 3. 3-year horizon is standard for a Series B. Monthly granularity needed to model the ARR waterfall (new logo, expansion/contraction, cross-sell, churn) matching the format shown in slide 8. - **Key drivers & assumptions:** | Driver | Value | | -- | -- | | Starting ARR | "Double Digit Millions" - model with ~$15–20M as midpoint | | ARR growth rate (forward) | 2.5–3.0x YoY | | Product mix: Core HRIS | ~25% of ARR | | Product mix: IT | ~30% of ARR | | Product mix: Payroll | ~20% of ARR | | Product mix: Benefits | ~15% of ARR | | Product mix: Reseller | ~10% of ARR | | Customer segment mix | ~70% MM, ~30% SMB | | Net Dollar Retention | 120–125% | | Gross Margin | 80–85% | | Sales efficiency (Magic Number) | ~1.0x | | Avg customers at start | Several thousand | | New logo growth | ~10–15% MoM new ARR at this stage | | Churn rate (logo) | ~1–2% monthly logo churn | | Cross-sell contribution | ~15–20% of net new ARR | | Headcount | ~250 at time of raise | | S&M as % of revenue | ~40–50% | | R&D as % of revenue | ~25–35% | | G&A as % of revenue | ~10–15% | - **Scenarios (Base / Bull / Bear - which variables flex):** - Base: 2.5x YoY ARR growth, 120% NDR, Magic Number 1.0, gross margin 82%. - Bull: 3.0x YoY ARR growth, 130% NDR (faster cross-sell), gross margin 85%, sales efficiency improves to 1.2x. - Bear: 1.8x YoY ARR growth, 110% NDR (slower expansion), churn increases, gross margin 78% (payroll/benefits drag). - **Required sheets / outputs:** 1. Assumptions - all drivers with scenario toggle (Base/Bull/Bear). 2. ARR Waterfall - monthly: beginning ARR, new logo, expansion/contraction, cross-sell, logo churn, product churn, ending ARR (matches slide 8 template structure). 3. ARR by Product - four product lines + reseller tracked separately. 4. ARR by Segment - MM vs. SMB. 5. Cohort NDR table - monthly cohorts, 12-month expansion to 125% NDR target. 6. P&L - revenue (= ARR recognized), COGS, gross profit, S&M, R&D, G&A, EBITDA. 7. Headcount plan - by department, driving S&M/R&D/G&A. 8. Cash & Runway - burn rate, cash balance, months of runway post-raise. 9. SaaS Metrics Summary - Quick Ratio, Magic Number, NDR, CAC payback, LTV/CAC (once pricing assumed). 10. Dashboard - KPI summary cards. ## Frequently asked questions ### Is the Rippling (Series B) financial model free? Yes. The Rippling (Series B) model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.