- Run The World, an online-events platform that seeks to replicate the experience of meeting in person at conferences and gatherings, announced it raised $10.8 million in a Series A round coled by Andreessen Horowitz and Founders Fund.
- High-profile investors such as Hollywood's Will Smith and DoorDash's Tony Xu also participated in the round for Run The World, which has seen its popularity accelerate in the remote-work era.
- Founders Fund's Keith Rabois, known for his early investments in Airbnb and DoorDash, told Business Insider he was separately introduced to the company by two seed investors.
- As a "founder-driven" investor, Rabois acknowledged that sizing up founders on Zoom was tough, so he leaned into his network to get references for the founders from seed investors and former Facebook colleagues before offering the startup a term sheet.
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For most startups, finding a venture-capital investor willing to shore up its capital reserves is a long shot at the moment.
But there are still a few hot startups that have seen venture capitalists scrambling to join their funding rounds, despite the snags that come with meeting and vetting founders via Zoom.
Run The World, a digital-events platform that hosts conferences and other gatherings online, seems to be one of the lucky few. The startup announced that it raised $10.8 million in a Series A round coled by Andreessen Horowitz and Founders Fund, closing a new funding round less than a year after it raised its $4.3 million seed round.
High-profile angel and celebrity investors also joined in the round, including Will Smith's Dreamers fund and Kevin Hart's Hartbeat Capital. Other investors include DoorDash's Tony Xu and WhatsApp founder Chris Daniels, who had both invested before. Run The World CEO Xiaoyin Qu said even more investors filled her inbox with pitches, eager to take equity in a remote-conference company whose services have drawn substantially more demand because of the coronavirus outbreak.
For some longtime Silicon Valley investors, like Founders Fund's Keith Rabois, the startup seemed promising enough to entice them to commit funding to Run The World without a face-to-face meeting with the founders. It was a step that Rabois had never imagined himself taking.
"This is the first investment that I've ever made in my life where I haven't met the founders in person," Rabois said. "So just even getting comfortable about it, for me, was a significant step."
'Founder-driven' investing in a remote-work world
Foregoing the in-person meeting is especially challenging to investors like Rabois, who doesn't stick to an investment thesis to guide him in dealmaking. Instead, Rabois describes himself as a "founder-driven" investor who relies on an extensive network and his own judgment to bet on startup founders with ambition and potential.
It's a strategy that has driven him to make bets on YouTube, LinkedIn, Airbnb, and DoorDash. But the ex-PayPal executive's intensely personal style is hindered by the coronavirus crisis, as founders and investors are being forced to establish relationships on Zoom.
"Truthfully, it's not ideal for me," Rabois said, comparing his strategy with that of an investor guided by business and market metrics. "I think the current environment handicaps founder-driven investors considerably and materially vis-à-vis other styles."
But as a player in Silicon Valley's investing scene since the early 2000s, Rabois has a powerful network that not only refers him to startups but may also back up the founders he's thinking of investing in.
In Run The World's case, Rabois said, two seed investors had separately introduced him to the company.
"I figured there must be something fascinating and intriguing about the company, so I should probably take this seriously," Rabois said.
Besides jumping on several Zoom calls with Qu, Rabois also sought out recommendations from the founders' old colleagues at Facebook. Rabois said his chief of staff at Founders Fund, Matt Lanter, knew the founders from his old gig at Facebook, and had even previously worked with one of them. That connection bolstered Rabois' confidence in the company.
And Run The World, which also wasn't used to meeting investors remotely, exercised the same due diligence. Qu told Business Insider that she'd made sure to call up common connections in their networks to find out whether the investors would be a good fit for the company.
Run The World launched out of stealth mode in February, just as the coronavirus outbreak was beginning to drive companies to change their travel plans and cancel conferences. At the time, Qu had just an inkling of how forcefully the coronavirus was about to accelerate her startup's growth.
But as the virus spread like wildfire across the nation, people began to realize that socializing (as we knew it) was going to change. And Run The World, founded on the simple premise that conferences organized online could increase access, suddenly found itself hosting everything from product-management networking events for women to conferences on psychedelic research.
That realization has boosted Run The World's user growth hundredfold, according to Qu. The startup, which enables customers to run the online equivalent of in-person lectures, conferences, or festivals, has gone from hosting 20 events to about 2,400 in just three months.
Qu, a former product manager at Facebook, is particularly excited about the success of her startup's "Cocktail Hour" feature, which lets conference attendees mingle outside the main event and helps them stay in touch after the conference. "Introverts love this ... they're able to make more meaningful connections online than offline," she said.
Signs like this make Qu optimistic about the startup's chances even after shelter-in-place orders are lifted and the world goes back to normal. She plans to use the new funding to create even more ways to use the app and build improvements into its video and audio quality that deliver better access to users across the globe.
"The money can help us really accelerate building the right type of use cases for those people and making sure it's easy for them," Qu said. "Obviously we also increased our investment in the video quality and the audio quality to be able to support worldwide use."