“Money is on sale right now,” Silver Lake partner Charlie Giancarlo told the CEO of startup Blue Jeans Network. “Go get some.”
That’s why Blue Jeans CEO and founder, Krish Ramakrishnan, raised $US50 million in a matter of days.
That brings his current total to about $US100 million.
Ramakrishnan was busy building his cloud videoconferencing business, a service that connects users on different systems so that a Skype user, Google Hangouts user and Cisco’s TelePresence user can all talk to each other.
Putting $US50 million more in the bank wasn’t even on his radar, Ramakrishnan told Business Insider.
That changed when a casual meet and greet with Roger Lee, a general partner with Battery Ventures, turned into an offer to invest.
“I didn’t even know I was going to raise money,” he said.
But Ramakrishnan was cautious. He didn’t need the money yet, having raised $US25 million 15 months earlier. He didn’t want to sell off more equity in his company.
When he told his board about the offer, Giancarlo, an investor and board member, convinced him now is a good time for enterprise cloud startups to scoop up cash. VCs were offering very favourable terms — a lot of cash for a smaller-than-usual stake.
Ramakrishnan told Lee of his interest and Lee sprung into action.
“$15-20 million was what we were thinking we would raise. We got an offer all the way to $US75 million but I said, no, I won’t take that much. Let’s try $US50 million,” Ramakrishnan told us.
$26 million came from Battery and the rest from Accel Partners, New Enterprise Associates and Norwest Venture Partners.
Ramakrishnan wouldn’t share Blue Jeans valuation or the total equity he gave up for this deal. But he said it terms were so favourable he couldn’t say no.
“We had very little dilution,” which was important because “as a founder, and for the employees, at the end of the day people need to own something,” he said.
The Battery team was so excited about getting their chunk of Blue Jeans they even starred in this cheesy YouTube video where they smash a bunch of video conferencing equipment.