The Seattle startup, which sells AI-powered software to help people practice real-world conversations such as sales calls and feedback sessions, announced a $40 million Series B round on Tuesday to fuel growth. WestBridge Capital, a $7 billion global investment firm, led the round.
The fresh funding comes less than a year after the company’s $13.7 million Series A round in May.
Yoodli’s software lets users create personas to simulate conversations with another person or multiple people. The company’s model is trained on effective communication techniques and can be customized depending on an organization’s goals. Customers include SAP, Google, Snowflake, the University of Washington, Korn Ferry, and others.
“At a moment when AI is replacing human jobs, we’re doubling down on a different belief: that AI should help people become the best version of themselves in the conversations that matter most,” co-founder and CEO Varun Puri wrote on LinkedIn.
Yoodli’s revenue has grown around 900% in the past year. Its headcount has tripled to more than 40 people.
Yoodli co-founders Esha Joshi (left) and Varun Puri at the GeekWire Awards in Seattle last year. (GeekWire File Photo / Dan DeLong)
Puri told GeekWire earlier this year that Yoodli is like a “batting cage before game time,” or a flight simulator for communication. The idea is to replace passive formats such as slide decks and training videos with interactive practice that builds conversational muscle memory.
The company said it will use the new funding to expand into what it calls “experiential learning.”
“Experiential learning is the next step of conversation coaching — helping people learn, practice, and apply skills with roleplays at the center of their experience,” Puri wrote. “We’re making learning more fun and actionable for individuals and much more closely tied to ROI for organizations.”
The raise comes amid competition in the AI-powered workforce training market, as employers look for tools to upskill workers in communication, leadership, and customer engagement — areas where traditional learning management systems may have limitations.
Puri and Esha Joshi launched Yoodli in 2021 at the AI2 incubator in Seattle. The startup got off the ground with a consumer-focused offering targeted at practicing public speaking.
Neotribe and Madrona also participated in the latest funding round. Total capital raised is nearly $60 million.
From left: Avante CEO Rohan D’Souza, Fuse founding general partner Kellan Carter, and GeekWire editor Taylor Soper at a Seattle AI Week panel discussion last month. (Photo courtesy of Jen Haller)
If you’re building an early-stage startup and trying to raise venture capital dollars to fuel your big ideas — focus on solving a specific problem, make sure you have strong conviction, and think hard about distribution in the age of AI.
Those were some tips shared during a recent Seattle AI Week panel discussion I moderated with Kellan Carter, founding general partner at Bellevue, Wash.-based firm Fuse, and Rohan D’Souza, CEO and co-founder at Seattle-based healthcare benefits startup Avante.
The pair know each other well. Fuse led Avante’s $10 million seed round in late 2023, before the company was generating meaningful revenue.
Carter initially met D’Souza several years earlier. “There’s so much trust that had been built,” Carter said, reflecting the importance of relationship-building between founders and VCs.
The title of the panel discussion, hosted by Seattle VC firm Ascend, was “The New Series A Landscape” — a nod to shifting expectations in the AI boom.
Fuse founding general partner Kellan Carter. (Fuse Photo)
The median Series A round in Q1 of this year was $7.9 million, according to Carta. But there were also nine companies that raised more than $200 million for their Series A rounds in Q3, according to CB Insights.
“The variance for Series A is wider than ever,” Carter said.
For those companies raising massive Series A rounds, Carter said it’s about “unfair insight” that creates conviction and opens doors to capital.
“The insight is so clear it’s getting investors excited to cut that big of a check — because the prize is so big right now,” Carter said.
Venture funding has increased to a 3-year high, largely thanks to AI, which accounted for 51% of all funding and 22% of deals in Q3, CB Insights reported.
Carter joked that AI is “always in the pitch now — even if it’s not AI.” For Fuse, assessing a pitch is about determining the best way to solve a customer’s problem — with or without AI.
Carter said investors lean toward founders who have domain knowledge and understand a first- or second-priority customer problem better than anyone else. “They have insight that’s going to give them credibility in a customer conversation,” he said.
And in a world where AI is shifting how software is sold, Carter said he’s looking for a clear distribution advantage. “Product won’t win,” he said. “Distribution will win.”
He added: “We love founders that have the domain experience, that have the insight, and they can get us super excited about a distribution strategy that’s a little more clever or unique in an AI world.”
When it comes to talking about AI during a pitch, the conversation will differ depending on whether you’re talking to a customer or investor, according to D’Souza.
He said customers may have “FOMO” when it comes to AI — fear of missing out — but they probably actually have “FOMU”: fear of messing up. D’Souza said it’s the founder’s job to help customers understand that it’s about “unlocking a whole new way of productivity.”
For investors, D’Souza said it’s important to show how AI improves margins — for example, by speeding up customer acquisition and onboarding.
Avante CEO Rohan D’Souza. (LinkedIn Photo)
Avante officially launched earlier this year as it scales its software product that aims to help companies decrease HR administration workload and reduce overall benefits program costs.
As he thinks about raising a Series A round of funding, D’Souza said one advantage of bringing in fresh cash is that it acts as a signal to enterprise buyers — some who may be wary of an early stage, 20-person startup tucked away in the Pacific Northwest.
“There’s a little bit of that perception of, what will happen if these guys go away?” he said. “So as a founder, I’m like, OK, should we really aggressively start to pursue more money on the balance sheet? To send a clear message out that, we’ve got a lot more gas in the tank, even though we didn’t necessarily need it.”
As for competitors, D’Souza said founders should focus less on similar startups and more on incumbents. “What are they doing to unlock a feature set? And how do you get there much faster?” he said.
Carter noted that Fuse stays clear of companies that might directly compete with the likes of Microsoft, Amazon, OpenAI, or Anthropic.
“If we think that there is an inkling that they’re going to release a product and the next thing you know, everyone is competing against free or bundling — that’s a problem,” he said.
D’Souza, a former product chief at healthcare automation company Olive AI, stressed the importance of transparency with investors.
“Be very clear about your timelines,” he said. “If you need three months or six months to really build out the core of your product, be extremely transparent about it.”
D’Souza said Avante deliberately planned no recurring revenue for 2024, ran an early adopter program that wasn’t free, then came out of stealth in April 2025 and converted pilots into multi-year deals. “We created a little bit of scarcity and FOMO around this concept of an early adopter program,” he said.
D’Souza also advised his fellow founders to “focus on the one core thing that you do 100X better.”
Image created by ChatGPT based on the text of this column.
Editor’s Note: GeekWire co-founders Todd Bishop and John Cook created this column by recording themselves discussing the topic, asking AI to draft a piece based on their conversation, and then reviewing and editing the copy before publishing. Listen to the raw audio below.
If we look out GeekWire’s office window right now, down at Seattle’s Burke-Gilman Trail, we can practically guarantee one thing: if we wait 5 minutes, at least one Rad Power Bike will zip past. Probably more. They are ubiquitous — the “Tesla of e-bikes” that seemed to redefine urban transport during the pandemic.
But that physical prominence masks a brutal business reality.
In the last few weeks, the Seattle tech scene has been rocked by two stories that feel like different verses of the same sad song, as documented by GeekWire reporter Kurt Schlosser. First, Glowforge — the maker of high-end 3D laser printers — went into receivership and was restructured. Then came the news that Rad Power Bikes might be forced to close entirely.
We’ve each covered the Seattle region’s tech ecosystem for around 25 years, and if there is one enduring truth in the Pacific Northwest, it is that hardware is not only hard, as the old saying goes, but for some reason it seems harder here.
It is naturally harder to manipulate atoms than digits. If Windows has a bug, Microsoft pushes an update. If a Rad Power Bike has a busted tire or a faulty component, you can’t fix it with a line of code. You need a supply chain, a mechanic, and a physical presence.
But the struggles of Rad and Glowforge go beyond the physical manufacturing challenges. They are victims of two specific traps: the quirks of the pandemic and the curse of too much capital.
The COVID mirage
Both companies were born before the pandemic, but they boomed during it. When the world locked down, the thesis for both companies looked invincible. We were all sitting at home in our PJs, desperate for a hobby — so why not buy a Glowforge and laser-print trinkets? We were wary of public transit and looking for recreation — so why not buy an e-bike?
Many tech companies, including giants like Amazon and Zoom, bet big that these behavioral changes were permanent. They weren’t. And we are seeing some of the indigestion of that period play out with massive layoffs at tech companies that got too big, too fast during the pandemic years.
The world went back to normal, or at least found a new normal, but in the meantime these companies had scaled for a reality that no longer exists.
The VC curse
Then there is the money. In 2021, Rad Power Bikes raised over $300 million.
When you raise that kind of cash, you are no longer allowed to be a nice, profitable niche business. You have to be a platform. You have to be a world-changer. Rad tried to build a massive ecosystem, including direct-to-consumer retail stores and mobile service vans to fix bikes in people’s driveways.
Building a physical service network is agonizingly expensive. Had they raised less and stayed focused on being a great bike maker, we might be having a different conversation. But venture capital demands a “Tesla-sized” outcome, and that pressure can crush a consumer hardware company.
The ghosts of Seattle hardware
History tells us we shouldn’t be surprised. Seattle has a painful relationship with consumer hardware. We’ve got one word for you: Zune. Or how about the Fire Phone? Or Vicis, the high-tech football helmet maker that crashed and burned.
For those with long memories, the current situation rhymes with the saga of Terabeam in the early 2000s. They raised over $500 million to beam internet data through the air using lasers. It was a B2B play, not consumer, but the pattern was identical: massive hype, massive capital, and a technology that was difficult to deploy in the real world. They eventually sold for a fraction of what they raised.
We still love seeing those bikes on the Burke-Gilman. But in this economy, with inflation squeezing discretionary spending, $1,500 e-bikes and $4,000 laser printers are a tough sell.
Seattle may be the cloud capital of the world, but when it comes to consumer hardware, we’re still learning that you can’t just download a profit margin.
From left: David Wickwire, Minh Le, and Craig Sherman are the managing directors for Service Provider Capital’s new PNW fund. (Wilson Sonsini; Stifel Bank Photos)
Seattle’s startup lawyers and bankers have long helped founders raise capital. Now they’re pooling some of their own money to invest in promising early stage tech companies across the Pacific Northwest.
A trio of longtime Seattle startup service providers — Minh Le of Stifel Bank and Craig Sherman and David Wickwire of Wilson Sonsini — are teaming up to lead the Pacific Northwest fund for Service Provider Capital (SPC), a national firm that invests region by region.
SPC launched in 2014 out of Colorado with a unique startup investing model. It co-invests in early stage rounds led by institutional venture firms, typically writing smaller checks into those same deals.
The investors — limited partners, or LPs — come from law, banking, accounting, and insurance communities, reflecting an effort to let the professionals who support startups also invest in them. Angel investors and serial entrepreneurs are also part of the mix, using SPC as a way to back more local founders.
“It’s folks that support the ecosystem but oftentimes don’t have access to the asset class,” Le said.
The model aims to “index” a region’s early-stage activity, backing dozens of companies rather than betting on a few. SPC has expanded its model from Boulder into other regions such as New England, Texas, and Chicago. It has raised 11 funds across six regions, investing in about 60 companies per fund.
Jody Shepherd. (LinkedIn Photo)
SPC began exploring a Pacific Northwest fund about a year and a half ago. Jody Shepherd, co-founder of SPC, said the region felt like a “perfect fit” given its strong venture community and deep talent pool around tech giants such as Amazon and Microsoft.
“Once we found a team like Minh, David, and Craig to lead the fund, plus an outstanding crew of well-connected LPs, an SPC Pacific Northwest fund was a no-brainer,” he told GeekWire.
Le, Sherman, and Wickwire are mainstays of the Seattle tech ecosystem. Le, a former Silicon Valley Bank leader, joined Stifel Bank in 2023. Sherman and Wickwire have a combined four decades of experience at Wilson Sonsini, representing many of the region’s top venture-backed startups.
Unlike traditional funds, the local managing directors keep their day jobs. They help surface deals through their networks, while Service Provider Capital makes final investment decisions.
The goal isn’t to generate new business for their firms, they said, but to strengthen the broader ecosystem by expanding access to early capital. The fund’s LP base includes many of their professional peers and competitors, from other law firms and banks across the region.
The fund’s model is intentionally broad and formulaic. Diligence is minimal; meeting the criteria (early stage tech or life sciences startup in the Pacific Northwest raising its first round from an institutional investor) is often enough.
Because the fund relies on trusted institutional leads, founders don’t need to pitch SPC directly — if they meet the criteria, the fund can join a round quickly.
The new Pacific Northwest fund has raised $3 million and has already made two undisclosed investments. It writes checks in the $50,000 to $100,000 range.
The fund also aims to fill a gap left by longtime angels who’ve retired or joined venture firms, serving as a kind of “strategic angel” to help complete early rounds, Wickwire said.
The Seattle startup ecosystem has long been critiqued for lacking local capital to invest in up-and-coming companies. The closure of Techstars Seattle last year created another gap in early stage funding and mentorship.
“There are great entrepreneurs here, there are great engineers here — and the more capital there is supporting the local market, the better off we’ll all be,” Sherman said.
OPINION -- I recently had a conversation with senior intelligence community leaders about their desire to build stronger partnerships with private-sector technology companies—the so-called “Silicon Valley” ecosystem. They were asking for advice on how to engage, build relationships, and ultimately establish strategic partnerships.
But the companies they were most interested in? They were largely consumer-facing platforms. Innovative, yes—but not mission-aligned. That conversation highlighted a broader, more fundamental gap I’ve been thinking about for a long time: Why are there no U.S. offensive cyber unicorns?
We certainly have defense contractors who do cyber work—on site, on contract, embedded with the government. And we have standout cybersecurity companies like CrowdStrike, Mandiant, and Dragos focused on detection, response, and resilience. But where are the startups building offensive cyber tools and platforms? Where’s the VC-backed innovation model we’ve seen in drones, hypersonics, and space?
Save your virtual seat now for The Cyber Initiatives Group Winter Summit on December 10 from 12p – 3p ET for more conversations on cyber, AI and the future of national security.
Companies like Anduril and SpaceX have proven that Silicon Valley-style innovation—product-focused, capital-efficient, fast-moving—can thrive in the national security space. So why hasn’t that approach been applied to offensive cyber? Yes, there are legal and secrecy constraints. But those same constraints haven’t stopped commercial companies from building weapons systems or highly classified ISR platforms.
Take a look at the NatSec100 - a curated list of top defense and national security startups. You’ll find companies working on AI, autonomy, sensing, and cybersecurity. But not a single one focused on offensive cyber. Why not?
Shouldn’t we want the best minds at CrowdStrike or Mandiant to spin off and build next-generation offensive platforms? Shouldn’t the DOD and IC be seeding these ideas and building an ecosystem that encourages this kind of innovation?
I believe we should.
Follow Bryan on LinkedIn or right here at The Cipher Brief.
The Cipher Brief is committed to publishing a range of perspectives on national security issues submitted by deeply experienced national security professionals.
Opinions expressed are those of the author and do not represent the views or opinions of The Cipher Brief.
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Chris DeVore, founding managing partner at Founder’s Co-op, at the GeekWire Summit in 2022. (GeekWire File Photo / Dan DeLong)
Seattle venture firm Founders’ Co-op unveiled its sixth fund — $50 million, matching the size of its previous fund — to back another batch of early-stage tech startups.
Chris DeVore, founding managing partner at Founders’ Co-op, said about 80–90% of investments will go to Pacific Northwest founders, typically at the pre-product or pre-revenue stage.
Founded in 2008, Founders’ Co-op was an early backer of billion-dollar companies such as Remitly, Outreach, and Auth0.
The firm is sticking to its core strategy of backing ambitious technical founding teams in its backyard and helping them build companies that go on to raise capital elsewhere.
“Our strategy has always been to be the best first-check investor in our chosen market, not to grow our AUM and wind up competing with the money-center investors our founders need for the next leg of the journey,” DeVore wrote in a blog post.
He added, in reference to the fund size: “It’s not bigger, because as they say in venture, ‘your fund size is your strategy.'”
GeekWire previously reported on the fund earlier this year.
The new fund will go to about 30 companies. Average initial checks will range from $1 million to $1.5 million. The firm aims for 10% ownership at the first investment. It does not invest in specific verticals, instead placing more weight on entrepreneurs.
“We’re lucky to be alive in the greatest era of compounding technological advancement in human history,” DeVore wrote in the post. “And we expect that acceleration to continue. But no moment in the hype cycle — up to and including the current LLM wave — matters more than the people we back and the problems they choose to solve.”
Aviel Ginzburg. (Founders’ Co-op Photo)
Founders’ Co-op is now based inside Foundations, the new hub for Seattle-area entrepreneurs founded last year by Aviel Ginzburg, general partner at Founders’ Co-op. It has quickly become a magnet for the city’s startup community — and an advantage for Founders’ Co-op.
“Foundations is Aviel’s love-letter to the local founder community — so it’s not a fund project — but by making Seattle a better place to be a founder, and helping the strongest and most committed founders connect and share with each other, it has absolutely put compelling new investment opportunities in our path,” DeVore told GeekWire.
Asked this morning if the firm is still bullish on Seattle, DeVore said: “like you wouldn’t believe.”
Some of the firm’s more recent investments include land use data startup Aarden AI, business automation AI company Logic, and internal help desk startup Ravenna.
DeVore said one team “particularly worth watching at the moment” is RowZero, a Seattle startup that sells spreadsheet software and raised $10 million in a seed round earlier this year.
Most limited partners in the new fund are returning investors, with a few new backers from outside the region who “believe in small funds and the PNW as a differentiated and underserved market,” DeVore said.
Founders’ Co-op raised $50 million for its fifth fund in 2021 and $25 million for its fourth fund in 2018.
DeVore previously led the Techstars Seattle accelerator but stepped down in 2019 to focus on Founders’ Co-op full time. Ginzburg, a Simply Measured co-founder who joined the firm in 2015 and became general partner in 2018, was managing director of Amazon’s Alexa Accelerator from 2017 to 2020.
Ginzburg launched Foundations in the aftermath of the surprising closure of Techstars Seattle last year.
Other Seattle-area firms raising new funds include Ascend, Flying Fish, and Graham & Walker. Longtime firm Madrona raised $770 million for its new funds earlier this year.
Image created by Google Gemini based on the audio of this week’s GeekWire Podcast.
This week on the GeekWire Podcast: Why is Amazon laying off 14,000 people in the middle of an AI boom — and is it really a boom at all? We dig into the contradiction at the heart of Seattle’s tech scene, discussing Amazon CEO Andy Jassy’s “world’s largest startup” rationale and what it says about the company’s culture and strategy. And we debate whether AI progress represents true transformation or the familiar signs of a tech bubble in the making.
Then we examine the vision of Cascadia high-speed rail — the ambitious plan to connect Portland, Seattle, and Vancouver, B.C., by bullet train. Is it the regional infrastructure needed to power the Pacific Northwest’s next chapter, or an expensive dream looking for a purpose?
With GeekWire co-founders John Cook and Todd Bishop
When Tim Chen tried to break into venture capital six years ago, multiple firms in Seattle turned him down. “Nobody wanted to hire me,” he recalled in an interview with GeekWire. “I was too technical, they said. Too nerdy.”
Chen, a University of Washington graduate and infrastructure engineer who had just sold a startup, decided to launch his own firm.
Six years later, Chen’s investors — known as limited partners, or LPs — line up to give him money before he even opens a pitch deck.
Chen recently raised $41 million for a fourth fund at Essence VC, his venture firm that backs infrastructure startups. His LPs include institutional investors such as Andreessen Horowitz’s Martin Casado and Cendana Capital’s Michael Kim.
TechCrunch described Chen as “one of the most sought-after solo investors,” highlighting how investors preempted the latest fund.
“I had no deck, no memo — I hadn’t even started raising,” Chen told GeekWire. “The LPs just all came in.”
Chen used AngelList to raise $1 million for his first fund in 2019, focusing on developer tools and infrastructure — categories he knew inside out. The experiment quickly snowballed: he raised $5 million for Fund II and $27 million for Fund III.
A dozen companies from the Essence portfolio have been acquired, including Tabular, a data management startup that sold to Databricks last year for a reported $2.2 billion.
What started as rejection has become a calling for Chen — and an unconventional venture capital success story.
After studying computer science at the UW, Chen worked at Microsoft and VMware, helped launch open-source cloud startup Mesosphere, and later founded Hyperpilot, an “AIOps” company acquired by Cloudera.
Chen’s experience as a software engineer and operator has become his edge in VC — especially amid the AI boom. He’s able to make faster decisions and gain respect from founders.
“Tim asked the hardest, most interesting questions about how we were going to build what we said we were going to build,” said Jordan Tigani, CEO of Seattle startup MotherDuck. “From a founder perspective, this let me trust that he actually believed in what we were doing and was coming to his decisions on his own.”
Seattle entrepreneur Patrick Thompson raised capital from Chen twice — with his previous startup Iteratively, which was acquired, and his current company Clarify. “He’s one of the most technically-minded people, but also super humble and easy to work with,” Thompson said.
The combination of engineering depth and empathy has helped Chen win competitive early-stage deals. He’s built a niche around helping technical founders translate research and code into products and go-to-market strategies.
“I’m looking for people that have a deep enough background, with high intensity, and huge flexibility on learning,” he said.
Essence’s portfolio spans across the U.S. and beyond. LPs ask Chen why he hasn’t moved to the Bay Area yet.
Chen is staying in Seattle, where he’s lived since high school. He believes Seattle’s tech scene is under-networked but brimming with talent.
“There’s so much great engineering talent with great iconic companies here,” he said.
Essence plans to make around 40 investments out of its fourth fund. Seattle is certainly on Chen’s radar.
“Of course,” he said. “I’m meeting people here, like UW PhDs. I like technical people. The nerdier, the geekier, the better.”
The Cipher Brief's Special Report on Nat Sec EDGE 2025
The Nat Sec EDGE 2025 conference took place June 5–6, 2025 in Austin, Texas.
Foreword
The 2025 Nat Sec EDGE Conference brought together a diverse coalition of leaders from government, industry, investment, and innovation to confront a shared reality: America’s national security advantage is eroding-and our ability to adapt at speed will determine the outcome of future conflicts.
Across two days of discussions, senior officials, technologists, operators, and investors delivered a clear message: the U.S. is engaged in an unprecedented strategic competition with near-peer adversaries who are moving faster, with fewer constraints, in an effort to achieve dominance in emerging domains. While the U.S. still holds an innovation edge, our traditional systems for acquisition, classification, and risk management are too slow, too fragmented, and too siloed to respond to the velocity of today’s threats.
What emerged from this gathering in Austin, TX was not just urgency-but clarity. The U.S. needs a new model for national security innovation-one built around speed, trust, integration, and mission-first execution. This means enabling “new primes” that can move at the pace of technology, equipping the defense industrial base with secure pathways to scale, and empowering operators and decision-makers with the tools to bridge policy, procurement, and operational need.
It also means recognizing that the problem is no longer technological- it’s sociological. The innovation exists. The capital exists. The threat is clear. What’s missing are the connective tissues: the incentives, partnerships, and trust frameworks that can accelerate solutions from concept to deployment.
This report captures the most critical messages and moments from Nat Sec EDGE. It is intended as both a record and a roadmap-for those shaping the future of American security.
Suzanne Kelly, Brad Christian, Ethan Masucol and Connor Curfman contributed to this report.
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