A startup that frat guys and sorority girls love just raised $2.2 million at a $20 million valuation

Ryan Young and Madison Wickham were fraternity brothers at Texas State University. Shortly after they graduated, they came up with an idea for a startup.

During their fraternity days, the men would often use a catchphrase, "total frat move," when telling a ridiculous story to one another. Young and Wickham created a Twitter-like feed of statements ending with "TFM" and launched it in 2010. One early post read, "A sick lax pinnie, khaki shorts, and Sperry's is my required work from home dress code. TFM."

Like other college-targeted acronyms ("FML" for F--- My Life and "TFLN" for Texts From Last Night), TFM began to go viral. Over the next few years, Wickham and Young built up a loyal base of fratastic followers. They began producing longer articles which generated millions of reads per month and launched an apparel brand, Rowdy Gentleman, which now generates 75% of the revenue for TFM's parent company, Grandex. Two of Rowdy Gentleman's best selling T-shirts are "Back to Back World War Champs" and "Dadbod."

Pairing e-commerce with ad dollars is an increasingly popular business model for media startups. Thrillist, a larger Grandex competitor, owns clothing brand JackThreads. JackThreads generates most of Thrillist's revenue.

For its first few years, Texas-based Grandex was bootstrapped. Now it has raised its first round of financing from a bunch of strategic angel investors. It took a lot of work and 18 months, but the company has raised $2.2 million at a $20 million pre-money valuation. That valuation is about two times Grandex's projected 2015 revenue.

Investors include former Dell CFO Jim Schneider, Tory Burch board member John Hamlin, former Lockheed Martin COO and president Chris Kubasik, EMC CEO Joe Tucci, EMC Vice Chairman Bill Teuber, and Seagate president Rocky Pimentel.

Wickham tells Business Insider that Man Outfitters, Grandex's new clothing line that launched in February, is on track to generate $1 million this year without spending any money on third-party advertising.

Although revenue is up, Grandex's article traffic has remained relatively flat, in part because of Facebook's ever-changing algorithm. Wickham says Grandex's content sites, Total Frat Move, Total Sorority Move, and Post Grad Problems, are seeing a combined 10-20 million unique visitors per month.

While the funding process took a long time, it enabled Wickham and Young to keep the controlling stake in their five-year-old venture.

"It was definitely a challenge to manage the fundraising and the business at the same time," Whickham tells Business Insider. "During the 18 months, we had about 3 months of hardcore fundraising at the end of 2014/beginning of 2015, where we raised the majority of the money, but it definitely consumed a lot of mental space during the entire time period."

Being a revenue-generating startup allowed Wickham to take his time during the fundraise. The company is also relatively lean with just under 50 employees. "We have never operated the business with a cash burn, so there wasn't a specific point in time where we had to close all of the funding," Wickham says. "This allowed us to be a little more lax with the timeframe."