As a serial entrepreneur who has famously endured some ups and downs, Parker Conrad has nearly seen it all. Or so he might have thought until last wee

A $500 million term sheet in 12 hours: How Rippling struck a deal as SVB was melting down

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2023-03-17 18:00:11

As a serial entrepreneur who has famously endured some ups and downs, Parker Conrad has nearly seen it all. Or so he might have thought until last week. Certainly, he never imagined a run on Silicon Valley Bank that so abruptly upended the operations of Rippling, his six-year-old workforce management company, that it would liquidate $130 million in money market funds to meet the needs of its customers.

Neither did he imagine that in the span of 12 hours, Rippling would secure $500 million in fresh funding as a kind of insurance in the very likely scenario that SVB’s meltdown wasn’t resolved nearly as quickly as it happened.

Yet both things happened in short order, enabling Rippling to avert disaster and also quite possibly changing the 1,800-person company forever. Now, a week later, Conrad suggests he’s still processing it all, saying there wasn’t really time to panic; there was too much to do.

As with so many customers of the 40-year-old bank, Conrad first heard that there was trouble brewing last Thursday morning, March 9. Conrad received a call from a founder friend around 10 a.m., asking “‘Hey, what are you guys doing about SVB?’” Conrad recalls now. “I was like, ‘What are you talking about?’ and he said they’d gotten a call from an investor at Valor Equity Partners who told them they should move their money out of SVB.” Conrad’s initial reaction was,” That seems crazy; I haven’t heard anything about that.” Then he started looking more closely at his laptop, where on Twitter, moving money out of the bank had very suddenly become the talk of the startup world.