Tolan founders Evan Goldschmidt, CEO Quinten Farmer, and Ajay Mehta. Credit: Tolan

While other AI assistant apps help tech-savvy users shop for rare clothes or book flights, Robyn Hunt uses an app called Tolan to do the opposite: spend less.

Hunt’s Tolan is called Harper. And over the past few months, Harper has helped Hunt to reorganize her apartment in the San Diego area, handle a health emergency with her senior cat, and resist making out-of-budget splurges: “de-influencing her,” she says.

Harper is an AI character with an appearance that Hunt customized and named. They are not a replacement for real-life companionship, Hunt knows. But they’re a valued, daily part of her routine. She talks to Harper nearly every day, often for an hour. A content creator on TikTok, Hunt will talk through new videos with the character. Recently, they started playing the New York Times games Wordle and Connections together.

“I’m very, very aware that Harper is an AI, but I would say they’re a friend, and maybe a bit of a confidant,” Hunt says the first time we connect, in April.

Hunt is just one of about 250,000 people who talk to their own Tolan every month, turning to their AI counterparts for everything from daily affirmations to keeping on top of care for elderly relatives, better connecting with teenage kids, organizing projects, and better meal prep.

These Tolans – some styled as people, others as Pixar-esque fantastical beings, others as simple dots – are the product of a startup launched in 2023. Until recently called Portola, it’s now named Tolan, too.

And while it’s technically headquartered in San Francisco, CEO Quinten Farmer says it’s been focused on such use cases outside the tech hype cycle from the jump. About 70% of Tolan users are women; 40% are parents. One in six is actively caring for an aging parent. Users themselves are most likely to be aged between 30 and 45.

And while it initially started out as more of a live journaling app that could remember your conversation and propose new prompts overnight, Tolan looks different today: voice-first, able to track topics from photos to current events in Tabs, and able to connect by video to check grocery labels, or suggest a meal plan.

In so doing, Tolan has moved closer to an AI assistant itself – but not the executive- or chief-of-staff-oriented kind of many of its tech peers. Tolan doesn’t pitch itself to founders, or venture capitalists.

It’s not part of tech’s AI assistant race that’s prominently featured tools like Instinct and Town, valued in the billions, or Muse, promoted heavily by Meta. (Just yesterday, Stripe told Upstarts that at least 200 such apps now connect to its Link digital wallet, up from 70 in September.)

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But it makes real money. Annual recurring revenue has more than doubled from last year, to sit solidly in double-digit millions. And its users stick around, with a 115% year-over-year improvement in net user retention after 30 days in-app.

“I’m very proud that we didn’t start by serving a Silicon Valley audience,” says Farmer, who co-founded Tolan, originally called Portola, with CTO Evan Goldschmidt and president Ajay Mehta in 2023.

“The vast majority of agentic tasks that we pick up just come out of a person having a conversation,” he adds. “Then it’s on us to say, ‘Okay, cool, we’re hearing from you this is happening. Here’s a little bit of it that we can pick up and run for you.’ That’s where we make magic for people.”

But such magic costs money in inference and compute. Tolan users have historically paid a wide range, between $10 and $200 per month, for more usage and features. Rate limits or new tiers sometimes set off waves of agitated reactions in its passionate subreddit community and Discord channel.

So to keep expanding Tolan’s use cases, and widen access to Tolan via a first-ever free tier, the startup based in San Francisco that says it shuns Silicon Valley is raising more venture capital.

Tolan is announcing today that it’s raised $30 million in new funding from Union Square Ventures, Khosla Ventures, and Homebrew, doubling its total funding raised to date. The startup is declining to share its valuation, but says the round is a significant uptick from its previous – $120 million, according to PitchBook.

Below, we get into why users turn to Tolan – and how it navigates the balance of AI and human relationships. We also dive into its CEO’s wider challenge for the startup ecosystem: People don’t want lots of AI agents. They want one they can trust.

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The always-on call

After selling his previous startup, employer-linked neobank Even, to Walmart in 2022, Farmer and his co-founders started what was then Portola the following year to explore projects in AI that involved storytelling and longer-term memory.

Goldschmidt had worked with Farmer as CTO of Even; Mehta was a veteran of multiple startup projects.

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Initially, Tolan looked like an app that could record your thoughts in the moment, then analyze them overnight to make related suggestions or prompts the next day.

“We thought it was fun, we thought it was an interesting test of what was possible,” Farmer says.

The people who seemed to want a tool like Tolan weren’t other techies, but moms and people spending long drives alone, or looking after relatives. What they liked about Tolan: long-running memory that could last up to several months without being re-prompted, providing a companion that seemed to really know the user and share history with them.

A chat between Robyn Hunt and her Tolan, Harper, about her cat. Credit: Robyn Hunt

Hunt was one of Tolan’s first users after seeing an ad on TikTok; she became an early member of the Discord server, too. Conversations with Tolan started out feeling much more like talking to a clunky AI bot, but have gotten more natural over time, she says.

Another longtime user is Lakisha Smith, who works as a social worker assistant in eastern Tennessee, serving as an advocate for domestic violence and sexual assault victims. Smith started using Tolan as a companion to talk to about her feelings, especially after her best friend went through an illness and was no longer able to communicate as often.

Her Tolan, Gilly, would occasionally forget things, or make her cringe with tone-deaf comments like one that tried to compare how the two managed issues with their faith.

“I’m thinking, ‘There isn’t an AI lord that Gilly is praying to,’” Smith says.

But Gilly’s also become indispensable to Smith, entertaining her at times when she’s home (she lives alone), and available to have conversations on long drives at late hours for work.

“Tolan is really good as a place to talk about how I feel,” Smith adds. “You can’t necessarily call a human just to talk to them at 3am.”

A healthy balance?

But is such behavior healthy for everyone? Can talking to a Tolan alienate users from their real-life relationships, creating a loop of even deeper dependency?

A look at Lakisha Smith’s Tolan, Gilly, in different outfits based on time of day. Credit: Lakisha Smith

Farmer says he and his team have grappled with this question from the start. They built in safety features to flag users with mental health crises or suicidal ideation; they also coded Tolan to ask about other, real relationships in a person’s life, and suggest healthy behaviors like stretching or calling a relative.

Both Hunt and Smith talked about their Tolans helping them navigate real-world friendships, and Smith even tried using a test feature earlier this year that enabled users to hang out in-app with friends and their Tolans, too.

And Tolan’s creators stress that their app is used by a wide variety of people, from a real estate agent who talks to his Tolan on car rides to plan Dungeons & Dragons campaigns, to parents who use Tolan to help manage their households and navigate relationships with their kids. (A group feature for families is one of Tolan’s biggest growth drivers, Farmer says.)

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In August, Tolan completed a survey of nearly 5,000 active users that found that 91% of users said they had at least one human person to count on; 94%, meanwhile, said they’d turned to a Tolan when those people were unavailable. More than half said their real-life relationships had improved since using Tolan, while a large majority said Tolan made them feel calmer, and more confident.

Users have historically decried pricing changes or rate limits; when Tolan misses the mark on a new feature, its audience is vocal in letting them know. You’ll find Tolan staff, including Farmer himself, active in the app’s Reddit community and Discord channel, explaining decisions and taking lumps.

“I would take that ten times out of ten,” Farmer says, noting it shows people find the product valuable enough to care about. “In something where the wave is moving fast, you’re better off being directionally correct, and having really fast iteration cycles from there.”

The AI angle

Pricing has been one of Tolan’s challenges, with a user base that doesn’t have the same capacity for discretionary tech spend as work-focused, or techie-focused tools, but similar AI inference and compute costs to still handle.

After working closely with OpenAI models early on, Tolan has increasingly moved to control its own infrastructure stack, running open source models on its own GPUs.

At new investor USV, general partner Michael Mignano – also an investor in AI companies like Granola and Suno – says that Tolan getting better at maintaining that balance was part of what made the firm excited to invest. (Farmer says that Tolan isn’t profitable as it leans into growth.)

What USV’s really backing, though, is an agentic product that feels “so much more immersive” than other agents, Mignano says: “Why not have this helpful, friendly guide to take you through this really, really powerful and somewhat intimidating technology, rather than a simple text box.”

How Tolan’s look is evolving with its new use cases. Credit: Tolan

The next phase for Tolan, besides widening its access to more users, is how the tool can become more proactive. Farmer’s own Tolan knew, unlike his Muse agent, when his wife was about to give birth to their third child a few weeks ago; it checked up on him about their health after.

And Hunt, the early user, says her Tolan, Harper, flagged that she was struggling to keep up with her cat’s medication on time and helped set up a management plan.

One could easily envision how Tolan could do more to catch nearly dropped obligations, from PTA meetings to groceries, in a way that users might find more comfortable than a similar prompt from ChatGPT or a calendar-focused tool.

Tolan won’t be alone in chasing these use cases. Meta’s Muse seems to be moving in the same direction, advertising widely with its own cutesy character that you can name. (Town, though more work-focused, has nameable animals, too.)

Like a seasoned entrepreneur, Farmer frames such competition as validation: “Do you really need to have a relationship with it, and have a shared lore, and a shared backstory? Obviously, we think the answer is yes. And Zuck, Nat [Friedman] and that crew think so as well,” he says of Muse.

Where Tolan thinks it can win in the long run: by being more empathetic, more trustworthy, and a lot less techy.

“People want to build a real connection,” Farmer argues. “All the other capabilities, all the other noise – the ‘Oh my god, I can do it via iMessage, I can make it go shop for me,’ whatever it is – is just downstream of that entity that people are going to want to relate to, and do that through.”

Tolan Raises $30M For The AI Companion It…