US — TechCrunch
Tolan snags $30M for its AI companion that helps users navigate life
AI1 min read
Tolan, an AI companion app that helps people with daily life, emotions, and goals, has raised $30 million more. The round doubles its total funding and pushes its value above $120 million.
What happened
Tolan, a startup that makes an AI companion app, raised another $30 million. Investors in the new round include Union Square Ventures, Khosla Ventures, and Homebrew. Users talk to the app through a cartoon-style character that offers support and helps them get through their to-do lists.
Key numbers
- New funding: $30 million, which doubles the total raised so far.
- Valuation (what the company is worth): above the previous $120 million. PitchBook estimates more than $268 million, but the company did not share its own number.
- Revenue: annual recurring revenue (yearly income from subscriptions) is in the "double-digit millions."
- Users: more than 250,000 active users who had more than 70 million conversations in the past year.
- Users are about 70% women and 40% parents.
How Tolan makes money
Tolan earns money through tiered memberships, which are paid plans with different levels. Users need a paid membership to use all of the app's features. The app seems to appeal to neurodivergent people (people whose brains work differently, such as those with ADHD or autism), who may find extra help with feelings or organizing tasks useful.
Why it matters
Many AI companion apps have failed to catch on. Tolan seems to balance being helpful with not seeming too strange. A rival, Friend, faced harsh criticism for its pendant-style device, and Character.ai went bankrupt. But Tolan faces new competition from AI agents that do tasks, not just talk. The company also must handle the risks of AI emotional support, since lawsuits claim chatbots contributed to some users' suicides.
Glossary
- AI companion
- A chatbot app that talks with you and offers support, like a friend who is also a computer program.
- Valuation
- How much a company is judged to be worth.
- PitchBook
- A company that tracks and estimates the value and funding of startups.
- Character.ai
- An AI chatbot company that lets people chat with computer characters; it recently filed for bankruptcy.
- AI agents
- AI programs that do tasks for you, such as planning and organizing, not just chatting.