Peter Warhurst believes so strongly in Tampa Bay's funding scene that he commutes the hour-plus drive more than weekly from his home in Orlando.
Warhurst, who founded moving and storage company PODS, launched his second venture in 2020, which he said improves upon the PODS model. In the two years since the launch, he's raised more than $75 million.
"I bought a Tesla just for the reason of commuting," he said. "I opened in Tampa because that's where I opened our last business, and there are a lot of startup individuals happy with their last experience. I felt confident I could find money in the Tampa Bay area from friends and family."
He most recently announced a $35 million raise on Friday, following $15 million in December, both raised from Oppenheimer's & Co.’s asset management business in Tampa. The round was initially supposed to be $35 million total, according to Warhurst, and announced with a friends and family round simultaneously. While the timing did not work, Warhurst said to expect an announcement of an additional $5 million to $10 million raised by the end of the month.
"It's just really the timing of it; they've been waiting in the wings," Warhurst said, explaining he thinks the legacy of PODS helped catapult his new venture to the funding levels it has. "It's a combination of knowing a lot of things [in the industry], and we brought the same team together. I was able to paint that vision, and it was a pretty easy sell, to be honest with you."
The funding will be used as the company continues its nationwide expansion, where it expects to open roughly 20 warehouses by Q1 of 2023. Each warehouse takes roughly 24 months to become profitable, according to Warhurst. However, after the next funding announcement, he said the company will be set on capital for the next two years.
"Fortunately, we have all the funds, so it does allow us to really have real test agents in all 20 markets," he said.
Red Rover is already in five states, with locations in Washington, D.C., Chicago and Atlanta on the way. The rising boom in real estate prices has slowed some locations, such as Chicago, Warhurst said. However, he expects the 12-month timeline to be realistic for opening the next 20 locations.
"I'm optimistic in the other 20 markets, half we'll find immediately, and the ones that are difficult to find will come in toward the end of the year," he said. "I'm hoping it flows nicely. If I had it in all the markets at once, I couldn't throw a switch and have them all open instantaneously anyway."
Warhurst previously hinted about going public with Red Rover. Due to the relationship with Oppenheimer, he said the path is now even more open to various avenues, whether it be an initial public offering, acquiring companies or being acquired itself.
"The beauty of this business model is we will have all sorts of options going forward," he said. "With Oppenheimer as our partner, all of it is available to us."
