Rippling raised $500m in less than 12 hours

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Fallout from the early March collapse of Silicon Valley Bank (SVB) has been widespread.

With over $200 billion in assets, as a top 20 US commercial bank and specialist in providing financing for technology startups — SVB provided financing for almost half of US venture-backed technology and healthcare companies — the bank’s early March collapse has had a ripple seemingly felt everywhere.

From Vox Media, to the Californian wine industry, as well as cryptocurrency industry stalwarts including BLOCKFI and CIRCLE, deposits across multiple business sectors were put at risk as SVB losses stacked up.

Unfortunately, HR technology has not been immune from this either.

Rippling: The payroll comeback kid

However, reflecting on the fallout, it’s worth picking up one HR community story with a great feel-good narrative that cuts through the middle of it.

When Silicon Valley collapsed on Thursday 9th March, it was the day before payday for many clients of Rippling, the payroll and workforce management platform.

It meant for the 50,000 employees expecting pay runs to go off without a hitch — many of them average paycheck-to-paycheck Americans, with no connection to Silicon Valley or the technology sector — their wages were at risk.

Indeed, with the FDIC almost immediately closing SVB and freezing assets, clients had already noticed that employees hadn’t been paid as usual on the normal pay run.

Reacting quickly, Rippling managed to extend nearly $130 million of their own capital and used failsafe payment infrastructure to ensure that no clients’ employees were paid first thing Monday, with most getting paid on that day.

The $500 million problem

However, that still posed the problem of $545 million of Rippling customer money still locked up at SVB.

At that point, with no deposit guarantees, Parker Conrad, founder at Rippling, immediately got in contact with Greenoaks, who has invested in every Rippling funding round, to close a deal for future funding within half a day.

The round took the form of a Series E, raising $500 million it now values the company at $11.25 billion. Greenoaks get another four percent of Rippling as a result.

Customer obsession and a bright future

Although on the Sunday after the FDIC said it would guarantee deposits, Conrad said he wanted to press ahead with the deal as the round is a good reflection of Rippling's performance, is at a good price, and would allow them to continue a customer focus, and build great products.

He said: “This extraordinary financing would not have been possible but for the fact that Rippling’s business is strong and growing at triple-digit rates.He said: “This extraordinary financing would not have been possible but for the fact that Rippling’s business is strong and growing at triple-digit rates.

“Thank you to the Rippling team that got it done, to the partners who supported us, and to Greenoaks for the bet they’ve placed on our continued success.”

For Everett Randle, partner at Kleiner Perkins, who invested in this round and previous rounds, he said the speed of the funding round was a testament to the company’s customer obsession.

He said: "There are very few companies who could raise this amount of money, in less than 12 hours, at this valuation. The company now has just under $1billion on the balance sheet which it will use to heavily invest in building the best product in the category."

All eyes are on Rippling to see what wonders it delivers next.

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