I truly believe defining moments in our lives and careers can occur within a split second.
For quick context, back then there were about 250 investors in a room hearing five-minute pitches from dozens of founders, followed by short breaks for the investors to try and speak with as many founders as possible. Highly stressful. After the first session I was sitting in the pitch room and thought to myself, why don’t I just skip the pitch session, go outside and speak to any founder I can find, one on one, for as long as I want and not be pressured on time? What followed, immediately changed my career and future in investing.
Lesson — go where others aren't…
I walked out the door through the hallway and the first person that caught my attention had a t-shirt on that said “Webflow.” I pointed to his shirt, introduced myself, and asked him, “what is Webflow?” The co-founder, Vlad Magdalin (CEO), introduced himself, and told me briefly about Webflow — it caught my interest. He told me how he had tried three times to start this business in the past and that this was his fourth attempt. We parted ways shortly after, however, the conversation stuck in my mind and I reached out the next day to follow up. A few days later we committed $200k in their seed round. Surprisingly, not many other investors saw it as a “hot” company or gave them much investment — he ended up raising about $750k in that syndicate. I think Vlad didn’t really enjoy fundraising conversations at the time, or speaking to investors, so I can understand.
Lesson — great pitches don’t always make for great investments…
About six months went by and the monthly updates were pretty good on traction, but most importantly, I was seeing the craftsmanship and care the founders, Bryant, Sergie, and Vlad had for the business. We decided internally that this is the type of team we want to back and we had to find a way to invest more.
Lesson — updates to investors aren’t only about numbers…
So I reached out to Vlad and he said he wasn’t interested at the moment to engage on capital raising, given he was super focused and didn’t like the fundraising process. Three more months went by of me asking and him saying no, until I said, “can you have coffee tomorrow?” Mind you he was living in Mountain View, California and I was in NY. He replied, “yes, I didn’t know you were in town.” I booked a ticket for six am the next morning, arrived at a cafe, and told him that I was there just for him and heading back to NY right after our coffee. He couldn’t believe it and asked me why.
I explained to him that I was there because I cared not only about Webflow, but about him, what he was building, and that I wanted to invest more in the company. I had his attention. I gave my best pitch and was sure Vlad would say, “yes, let’s do something.” Unfortunately, Vlad was hesitant and pretty much said, “no, but I will think about it.” I was really bummed. For different reasons, he was hesitant, which came from a good place — focus and protection of his business. At the same time, I truly felt that our intentions were good and we could only be helpful. I didn’t want to give up.
On the way to the airport, I had these relentless thoughts about Webflow so I started writing Vlad a heartfelt letter about how I truly felt.
Letter to Vlad April 9th, 2014
Lesson — norms aren’t indicators of success…
At this point, I felt I had done all I could do. Vlad emailed me the next day.
“Ron, thank you for your visit, I really can’t say how much I appreciate the kind words and vote of confidence from you! As an update, we are really seriously considering your offer…” And long story short — within two weeks we were able to strike a deal that was very fair to all of us, quick, easy, and quietly! Woohoo! Thank Gd, we ended up doing an extension on our own of $1.5MM into the company! I repeat: On our own!
Lesson — Don’t take no for an answer…
What is truly amazing is that in the five years following our investment, Webflow didn’t raise a penny because they had built a product that brought tremendous value to its community and user base. Eventually, top-tier funds started to really pound Vlad to invest, but he didn’t need the money. Today Webflow is one of the most powerful No-Code platforms in the world, empowering creators to build on the web, with hundreds of thousands of customers, hundreds of employees worldwide, and very meaningful revenue!
Lesson — build a product for users who will see the value and pay for it…
That original seed bet and the extension we did on our own brought us to 6.5% ownership in the company at that time. From the beginning, we made sure to never constrain ourselves with minimum ownership norms. Webflow has continued to raise money on favorable terms ever since which has allowed us to retain significant ownership. For example, Webflow’s last round of financing was a $120MM Series C from Accel, Capital G, and by YC continuity at a $4Bn valuation, which from my math is 3% dilution…so luckily our hunch was right, Thank Gd
Lesson — do your own thing and don’t give up…
While to date we have made a great financial return, the true value to Rainfall Ventures comes in the way this experience defined our investment philosophy — backing quality founders who don’t give up, who believe in something, and who try time and time again — founders who care about their users and care about a vision…
Looking into this new market shaped by fears of a major downturn, I’m optimistic about the new visionaries founding companies and hopefully will find myself in another split-second scenario to explore a new opportunity that will define Rainfall’s future… Please Gd.
We are often running, chasing, traveling, and looking for the right deals, but I truly believe the best is right around us — just not so obvious at first…
Ron Rofé (center) with Vlad (right), and Sergei (left) in 2019 — excited about the future of Webflow! Not pictured, Bryant Chou.
Thank you Bryant, Sergie, and Vlad for being bold enough to take the risk of starting Webflow and creating the opportunity for many others to grow from it. Thank you for our friendship and taking a chance with me, I don’t take it for granted!