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Business News/ News / UPDATE 3-HR tech startup Rippling climbs to $13.5 billion valuation after Coatue-led funding
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UPDATE 3-HR tech startup Rippling climbs to $13.5 billion valuation after Coatue-led funding

RIPPLING-FUNDING/ (UPDATE 3):UPDATE 3-HR tech startup Rippling climbs to $13.5 billion valuation after Coatue-led funding

UPDATE 3-HR tech startup Rippling climbs to $13.5 billion valuation after Coatue-led fundingPremium
UPDATE 3-HR tech startup Rippling climbs to $13.5 billion valuation after Coatue-led funding

(Update with comment from CEO interview in paragraphs 5-6)

By Mehnaz Yasmin and Krystal Hu

April 22 (Reuters) - HR software startup Rippling said on Monday it was valued at $13.5 billion after raising $200 million in a financing round led by investment firm Coatue, a 20% increase from last year's valuation.

The group of investors also agreed to buy back up to $590 million of stock from employees and early investors in a separate tender offer, signaling strong demand to own stakes in Rippling.

Current investors participating in the primary funding round included Peter Thiel's Founders Fund, Greenoaks, and other existing investors. Dragoneer joined the round as a new investor, Rippling said.

Founders Fund committed $310 million to the round, which would be the firm's biggest check in a single round of financing in history.

The funding illustrated the steady rise in valuation for Rippling, a rarity among late stage startups, as its revenue has doubled year-over-year, according to Chief Executive Parker Conrad. It was valued at $11.25 billion as of March 2023.

In an interview, Conrad said the eight-year-old startup has no immediate plan to go public, but could arrange regular tender sales for employees to provide liquidity.

Rippling offers a workforce management platform that combines human resources, information technology and finance, helping companies like Taskrabbit and Five Guys manage their operations. It targets companies with fewer than 2,000 workers, competing with large firms such as Workday and Automatic Data Processing as well as startups like Justworks and Deel.

Based in San Francisco, California, the company has expanded globally with 2,800 people in offices across the U.S., India, Ireland, the UK and Australia.

The unprofitable company says it is sitting on over $1 billion cash. It says it plans to enter more international markets, invest in research and development and build new products to support clients.

Growing expectations of interest rate cuts and the rise of artificial intelligence (AI) are helping drive a rebound in capital raises in the tech sector after a more than year-long dry spell. Companies that can continue to grow its business while working toward profitability are getting rewarded for higher valuations. (Reporting by Niket Nishant and Mehnaz Yasmin in Bengaluru, Krystal Hu in San Francisco; Editing by Shailesh Kuber, Devika Syamnath and Michael Erman)

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Published: 23 Apr 2024, 12:42 AM IST
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