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Parker Conrad believed he had experienced it all as a renowned serial entrepreneur who had gone through some ups and downs. However, he never anticipated that a run on Silicon Valley Bank would destroy Rippling, his six-year-old workforce management company, and cause Rippling to liquidate $130 million in money market funds that its clients required for their payrolls.
Furthermore, he had no idea that Rippling would be able to secure $500 million in new funding in just 12 hours, allowing him to protect his business if the markets continued to spiral out of control.
Yet both events occurred quickly, saving Rippling from disaster and possibly altering the 1,800-person company for good. There wasn’t time to panic because there was too much to do, according to Conrad, who now claims that a week later, he’s still processing everything.
The emergency round organized by Greenoaks Capital offers Rippling the same valuation it received in fundraising last year, despite a market correction that has prevented most startups from obtaining money at advantageous terms.
Parker Conrad, a co-founder of Rippling, claims that the deal came together in about 12 hours as Rippling rushed to acquire $300 million that was frozen at SVB after it failed.
In an interview, he asserted, “I was able to make a few phone calls and get a handshake contract with Greenoaks. On Monday morning we had to wire money and close for the weekend. “.
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On that day, the Federal Deposit Insurance Corp. assumed control of SVB. The payroll assistance that Rippling was to provide for many of its clients. Rippling fronted its clients $130 million in cash in the expectation that it would be able to recover most of its investment because it had money locked up at the bank. That outlook seems promising now that the government has guaranteed all deposits at SVB.
With the additional capital, Rippling will now have about $1 billion in unrestricted cash on its balance sheet, according to Conrad.
Neil Mehta, the managing partner of Greenoaks Capital, said he had no trouble sending the emergency funds because he was impressed by Rippling’s growth and thought it would continue. He appreciates that Rippling has developed a comprehensive software platform that incorporates features like global compliance and staff onboarding.
Conrad, a former employee of corporate software start-up Zenefits who was fired after being charged with violating the law and ultimately reached a settlement with the US Securities and Exchange Commission, is also a hero to him.
Mehta said, “I would proclaim from the rooftops that this person operates with high ethics.
Some of the current backers of Rippling include Kleiner Perkins, Sequoia Capital, Coatue Management, and Founders Fund.
In total, Rippling has now raised $1.2 billion. The company is valued at $11.25 billion as of the close of the $500 million Series E round, the same value that was assigned to it when the $250 million Series D round closed back in May.