While originally a startup set to revolutionize the fashion world with 3D shopping, VirtualU's shift to focus on health technology with VFit – a scanner that delivers a quick, realistic way to track a person's fitness progress – seems to have paid off, literally.
VirtualU closed a $625k financing round this week, proving that a fledgling business built on Virginia Tech's campus can acquire the respect and support needed to expand and make its mark on the world.
"I think there are two primary things to note on the investor side," Caroline Pugh, co-founder of VirtualU, explained in an email. "There's the fact that the VT Alumni network was truly amazing and supportive in not just investing in VirtualU but [also] serving as great local mentors and advisors. We were really happy about being able to work with a lot of local people." As examples, Pugh mentioned that one of VirtualU's first investors was Win Sheridan, co-founder and CEO of Apex Systems, which sold for $600 million in 2012.
Other investors with Virginia Tech ties who played a role in this round of funding include: Adam Rossi, president and founder of Platinum Solutions (sold for $90 million in 2010); Kevin Minnick, vice president of product management for Cloud for Rackspace; Garnett Smith, former CEO and founder of Advanced Auto Parts; Don Howell, former CEO of ADMMicro (sold to GridPoint in 2009); and Sonu Singh, CEO and founder of 1901 Group, who was one of the first investors in Pandora and CVENT. A Virginia-based angel investment group, Radiant Ventures, with several Virginia Tech alums also invested.
"The other thing to note are the more institutional and bigger name investors we have on board," Pugh added. She specifically talked about the great impact New York-based Future Perfect Ventures has had on VirtualU. Managing Partner Jalak Jobanputra "was a huge asset and win to our round considering her background being the Director of Mobile Investments for Omidyar and just experience in venture capital in general," said Pugh. "It was a huge validator in our traction."
Pugh cited three more outstanding contributors, too. Paul Murphy, partner at Betaworks – a VC fund that has invested in tech giants like Twitter, Tumblr and Airbnb – invested personally into the round, as did a former Managing Director of Citigroup, whose name could not be disclosed. Last but not least, there was Mark Lucas, a serial entrepreneur whose claim to fame is being the first franchise owner of Five Guys and former CEO of Provox.
In an interview over the phone, Pugh shed some light on how the most recent round of funding will affect VirtualU. "Financing will take us through the rest of the year or more," she said. "It's really going to be all about team expansion and getting customers on the gym and consumer side a great experience."
On the business side, Pugh said that VirtualU plans on hiring more sales reps and business development professionals as well as at least one more engineer, starting this summer.
On the consumer side, it's going to be all about making sure every interaction, everything that happens with the scanner – good or bad – is a pleasant experience. "Users need to know that they're being taken care of. We want to have them involved in the whole problem solving process so that they understanding what is going on," Pugh explained.
As for plans for the future, VirtualU's tech-savvy scanner VFit will be placed in a couple of Blacksburg locations over the course of the next few weeks. We're going to have to wait a little bit longer here in District, for the biggest rollout in the D.C.-area is not due to take place until the summer.
Image via VirtualU
