Video Chat App Rounds Raises $12M In New Funding Led By Sequoia

Rounds, a video chat company based in Tel Aviv, Israel, is announcing that it has raised $12 million in Series B funding.

The company was founded back in 2008 under the name Gixoo, launching a video platform called 6rounds a year later. Rounds says it now has 25 million registered users, and CEO Dany Fishel told me that the “vast majority” of them joined in the past few months.

Fishel said that growth hasn’t come from heavy marketing efforts (“We haven’t spent a dime on advertising”), but rather a “100 percent shift to mobile.” The company offers apps on iOS and Android, and it says it has been featured in either the Apple App Store or Google Play more than 100 times in the past few months.

In particular, Fishel highlighted the latest Android version as being the “slimmest” video chat app around, at 8.8 megabytes. He also argued that Rounds stands out from the many chat apps that have taken off recently because of its focus on creating a live, shared experience among multiple friends rather than an asynchronous chat that takes place over a long period of time — so, maybe closer to Skype or FaceTime, but with support for large groups (the app supports up to 12 people joining a single session) and for doing more than talking, like watching YouTube videos together.

“The sharing experience, doing stuff together, that’s the fundamental communication element that connects people,” he said. “This is the sole purpose of our DNA.”

Fishel added that more than 30 percent of Rounds sessions could be considered “meaningful,” i.e., longer than 3 minutes. The company also says that 94 percent of those calls involve some degree of interactivity beyond video chatting, whether it’s playing games or using video effects.

The new round was led by Sequoia Capital (which, as Fishel pointed out, was the only investor in Facebook-acquired WhatsApp), with participation from Samsung Ventures and previous backers including Verizon Ventures, Rhodium, and Draper Fisher Jurvetson’s Tim Draper.

This brings Rounds total funding to $22 million. Fishel said this will help the company invest in continued product development, research, and business development, as well as continued growth internationally. (The team remains largely based in Tel Aviv.) On the product side, his goals include making the chat experience even simpler to start, while adding more content and possibilities for interaction.

Rounds from Rounds on Vimeo.