Rippling, a workforce management software provider that helps firms with things like payroll, benefits and expenses, raised $500 million in funding in the space of 12 hours as it looked to shore up finances in the wake of Silicon Valley Bank's collapse.
In a blog detailing the scramble, Rippling CEO Parker Conrad reveals that the firm secured the funding in a round led by Greenoaks at the same $11.25 billion valuation it had at a more conventional May 2022 raise.
When SVB went into FDIC receivership last Friday, Rippling was faced with over 50,000 employees of its clients in danger of not getting paid. Rippling, writes Conrad, decided to extend nearly $130 million of its own capital to fund customers’ payments to their employees.
"This still left the problem of how to issue the payments. Until Friday, we had used the software infrastructure of SVB to reliably issue billions of dollars in payments each month. Our systems were built around SVB. Now, all of a sudden, SVB was gone."
Luckily, the company had recently set up accounts with JPMorgan Chase as a redundant payments infrastructure to avoid a single point of failure. Despite a tight turnaround, the firm managed to migrate over to JPMorgan in order to get employees paid.
However: "$545 million of our customers’ money was still locked up at SVB. And all of it was due to employees over the next three business days." Conrad contacted investor Greenoaks, and the $500 million term sheet was signed in 12 hours.
"Now, we’ve recovered all funds from SVB and our balance sheet holds just shy of $1 billion in cash. On top of all of this, we’ve moved our banking operations to JPMorgan Chase, and payroll is running smoothly."