HQ Trivia raises $15 million to become the next TV
HQ, the live trivia game-show app, tells Axios that it has raised $15 million in new VC funding at a $100 million post-money valuation. Founders Fund led, and was joined by return backer Lightspeed Venture Partners.
Why it matters: Because, on Sunday night, HQ had more than 2.1 million people staring at their phone screens for a solid 15 minutes. It's millennial Jeopardy, but with interactive engagement — and a bet by investors that appointment viewing can be recreated in a mobile world.
Recode had first reported many of the details in February, but the actual round didn't close until late last week. It also reported that some investors had declined to participate after learning of alleged "bad behavior" by co-founder Colin Kroll while at Twitter (which had acquired the last startup he and HQ CEO Rus Yusupov founded, called Vine).
Kroll outright denies to Axios that he ever sexually harassed any colleagues or employees while with Twitter, and also provided his first statement on the matter:
"As reported in the media, I was let go from Vine four years ago for poor management. It was a painful experience, but an eye-opening one that served as a catalyst for professional development and greater awareness in the office. I now realize that there are things I said and did that made some feel unappreciated or uncomfortable. I apologize to those people. Today, I'm committed to building HQ Trivia into a culture-defining product and supporting the dedicated team that makes it all possible."
Founders Fund partner Cyan Banister says she "became comfortable after looking at everything" during due diligence, and believes that her joining the board can help guide the executive team on issues of management, diversity and inclusion. "I believe in the spirit of forgiveness," she adds.
Yusupov and Kroll say HQ will use the proceeds to grow out its engineering team, which has occasionally been bedeviled by the technical challenge of having so many concurrent players (something that seemed on Sunday night to have been solved, at least temporarily, after many phone calls with Amazon Web Services).
But it also wants to grow out the platform, with expectations that this year will see greater geographic expansion (there already is a UK version) and the first stabs at revenue generation.
- Yusupov says that HQ players shouldn't expect to see typical ads sprinkled inside the game, but rather more native content that also could benefit players.
- In terms of prize money, he dreams of having $1 million jackpots. That said, HQ is resolute that the game's social and challenging nature drives its popularity as much, if not mores so, than the cash. "I've seen videos of people going crazy, so excited, over winning $2."
Longer term, HQ wants to become a branded platform that features other interactive games beyond just its flagship trivia program. "This is a big swing," Banister says, adding:
"Obviously there are still technical challenges, but I think most of those are in the past and the future is about developing content on top of what is a very strong brand. Rus is extraordinarily talented at finding the right talent. He did a casting call for HQ and hired [host Scott Rogowsky] because he said Scott was the only person who made him laugh."
She also isn't worried about an infamous Yusupov tweet that seemed aimed at Twitter:
"I'm more interested in them being an independent company and taking a big swing than being acquired. At Founders Fund, we find entrepreneurs not wanting to ever sell to be attractive."
Correction: An earlier version of this story incorrectly said the $100 million was a pre-money valuation.