The Riveter has raised a $15 million Series A investment round as the female-focused co-working space operator prepares for a big expansion across the U.S.
Founded last year, The Riveter is one of several co-working space companies that have popped up in recent years in the shadow of industry giant WeWork, now valued at $45 billion.
But the Seattle-based startup has differentiated itself by providing amenities, programming, and other membership perks geared toward female professionals. It now has more than 2,000 members across five locations in Seattle and Los Angeles — that’s up from 700 in March. The company, which is open to all genders (25 percent of members are men), aims to open eight locations in 2019 — including Texas and New York City — and reach 100 by 2022.
“This will fuel our growth and enable us to bring our mission of equity in the workplace to everyone, everywhere,” The Riveter CEO Amy Nelson wrote in a Facebook post about the round.
Los Angeles-based VC firm Alpha Edison led the Series A round, which included participation from existing investor Madrona Venture Group. Other new investors include New America President and CEO Anne-Marie Slaughter; fashion entrepreneur Liz Lange; TOMS Founder Blake Mycoskie. Female-led investment firms such as Women’s Venture Capital Fund, Backstage Capital, The Helm, and Gingerbread Capital also invested.
“In fact, our Series A investment team is 55 percent female,” Nelson wrote. “That is important to me. We can change the future of work and the face of entrepreneurship, one company at a time.”
The fresh investment comes on the heels of The Riveter’s $4.75 million round it raised just nine months ago. Since then, the 25-person company has inked partnership with companies such as Alaska Airlines and Microsoft, and welcomed speakers such as Jane Fonda, Arlan Hamilton, and Howard Schultz. The Riveter is profitable across its three Seattle-area locations.
“The Riveter fulfills a unique need – providing a practical space and inspirational community for the flexible workforce,” Hope Cochran, venture partner at Madrona Venture Group, said in a statement. “The result is a wonderful blend of social impact combined with a profitable economics.”
As of 2017, there were 15,500 co-working spaces worldwide, according to Statista, up from just 75 in 2007. Flexible space providers accounted for 4.4 percent of the square footage leased in major deals during the first half of 2018, up from less than 1 percent in 2013, according to a recent report from CBRE. In Manhattan alone, there are 65 flexible space companies that operate more than 260 locations, up 600 percent from 2009, according to another CBRE study.
A report last year from the Global Coworking Unconference Conference projected that there will be more than 30,000 co-working spaces by 2022, with 5.1 million members. It also noted that niche spaces including The Riveter are expanding the market beyond traditional operators such as WeWork.
“These spaces appeal to members with specialized interests or needs (shared biolabs, women oriented spaces, writers’ spaces, industry specific spaces, shared commercial kitchens, etc.) and attract people who likely would not join a traditional coworking space,” the report said.
The Riveter generates revenue from membership fees that range from $99 per month for floating desk space to $750 a month for a private office at the original Capitol Hill location in Seattle. There are also community memberships for those that don’t need regular office access and “business plans” targeted at corporations.
In addition to expanding its physical footprint, The Riveter is developing a digital platform for its members which includes an app that lets members connect with each other, register for events, stream workshops, and more.
Nelson, who is pregnant with her fourth child, called the new investment “significant at a time when venture capital funding for female-founder teams remains stagnant at a shocking 2.2 percent.”
“The Riveter’s entire business is built on our vision of a world in which equality of opportunity in work is not a promise, but is a reality,” she said in a press release. “That world is coming into focus, though slowly enough that our raise is a statistical outlier. These statistics underscore the importance and demand for resources, space and connection to help level the playing field for women in business.”
The Riveter previously raised a $760,000 seed round. Nelson created the company with Kim Peltola, who left the company shortly after it launched.
Recent investments by Alpha Edison include health tech startup IDx; consumer data startup DISQO; and brain-machine interface company Paradromics. It also invested in Seattle startup Novel Effect in May.
“The way we work is changing, and The Riveter has quickly become a trusted voice and a force for change around the future of work and equality,” Nick Grouf, managing partner at Alpha Edison, said in a statement. “We are impressed with the passionate physical and digital community The Riveter has built, signaling that this opportunity is redefining the ecosystem of work as we know it.”