The Idea:
In late 2023, Quinten Farmer had already won once. His last company, Even, had been sold to Walmart for a reported $300 million, and he wanted to run it back with the same crew. He teamed up with Even’s former CTO Evan Goldschmidt and Ajay Mehta, a founder of consumer brands with over a million customers. Everyone around them was using generative AI to build more vertical B2B SaaS, which Farmer found deeply uninspiring. So they went the other way. Their first idea was an AI creative tool for kids, in the spirit of Neal Stephenson’s The Diamond Age. One of their own investors, Zach Klein, backed them and called it a terrible idea in the same breath. Parents, it turned out, mostly want to buy babysitting. But prototyping showed them something bigger. Models were getting fast and cheap enough that you could have a real friendship with an AI character, at a price that worked for consumers. So they built a cute alien. Then the wrong people showed up.
This was the beginning of Tolan.
The Execution:
- June 2024: After months of play testing with 10 to 14 year olds, the soft launch flooded their Discord with 18 to 24 year old women instead. The team pivoted to follow them.
- February 2025: Tolan officially launched with 500,000 users already on board from the soft launch, plus a $10M seed led by Lachy Groom and backed by Nat Friedman, Daniel Gross, Amjad Masad and Instagram’s Mike Krieger. Tolans were deliberately non-human and programmed to avoid romance.
- Early 2025: The near-death moment. The team added a memory check before each reply, pushing median response time to around 2.5 seconds. That 500 millisecond change tanked every metric in the product and sparked a wave of angry user emails.
- March 2025: Months of seeded TikTok content from Mehta finally hit when a video of a woman cooking with her Tolan pulled 7 million views in 72 hours, driving a 10x download spike. ARR jumped from $1M to $4M in four weeks.
- July 2025: Khosla Ventures led a $20M Series A on the back of 3 million downloads, 100,000 paid users and over $1M a month in revenue, all with a team of 12.
- October 19, 2026: USV, Khosla and Homebrew put in another $30M, doubling total funding and lifting PitchBook’s valuation estimate from $120M to over $268M. ARR is now in the double-digit millions.
- Today: Tolan has 250,000+ active users who’ve had 70 million conversations in the past year. The audience has grown up with it: 40% are parents, 70% are women and one in six cares for an ageing parent. It isn’t profitable yet, and the new money funds its first free tier.
The lesson?
Tolan was built for 12 year olds. The people who turned up were 22 year old women, and today 40% of users are parents. Farmer never argued with his Discord. He followed it, and when everyone assumed AI companions were for lonely men, refusing romance became the selling point. Build for the user who shows up, not the one in your pitch deck.