KickUp: Why We Invested

By Elizabeth Coston McCluskey

Schools spend 80% of their budgets on staffing and billions of dollars on professional development for teachers, who spend up to 70 hours per year on those development activities. Despite the significant time and resources dedicated to it, the Gates Foundation finds that large majorities of teachers do not believe that professional development is helping them prepare for the changing nature of their jobs. Of top concern is how to use technology and digital learning tools, how to analyze student data to differentiate instruction, and how to implement the Common Core State Standards and other standards.

Solution

KickUp provides a platform consolidating professional development opportunities, tracking usage and feedback from teachers, and providing infrastructure for teacher coaching and feedback on their classroom practices. The platform enables data collection around professional development activities and effectiveness, and over time will enable districts to correlate professional development activities with improvement in teacher growth and student outcomes.

Why We Invested

We have been interested in professional development for some time, given both the size of the opportunity and the potential for impact. We also see tailwinds from the Every Student Succeeds Act, which requires school and district accountability on professional development spend. KickUp is the most compelling company we’ve seen in the space for a number of reasons. We have been impressed by the company’s early revenue traction and their ability to sell into districts; KickUp currently serves over 100,000 teachers. The team is led by Jeremy Rogoff, a former Teach for America corps member and KIPP teacher, who has experienced the problem firsthand.

Impact

Research from The New Teacher Project concludes that high performing teachers generate 5–6 more months of student learning each year than poor performers. Engaged teachers are more likely to adopt best practice instructional strategies, which should lead to better student performance. KickUp helps engage teachers in their professional development, and enables district-wide adoption of research-backed instructional strategies. While it’s still early days, KickUp has shown increases in teacher engagement of up to 70% in some districts. And schools that work with KickUp show a 10x increase in project-based learning instruction.

Climb Credit: Why We Invested

By Elizabeth Coston McCluskey and Sarah McGraw

Robert F. Smith’s recent pledge to pay off the student debt of 2019 graduates from Morehouse College renewed the conversation about the burden of student loan debt. According to the Federal Reserve, over half of young adults who went to college in the U.S. in 2018 took out student loans and will graduate with an average debt balance of $29,800. They join the more than 44 million borrowers who collectively owe an astounding $1.5 trillion in student loans — more than two and a half times what American students owed a decade earlier.

As a result, an entire generation of student borrowers are struggling to make ends meet — and only half say that the lifetime financial benefits of their degree outweigh the cost. Lifetime earning power varies significantly by higher education institution and even by degree program. Alternative pathways, such as Associate’s degrees and certificate programs, often offer a better return on investment — but it is difficult for students to assess the quality of and access financing for programs that do not qualify for Title IV funding (federal loans and grants).

Solution

Enter Climb Credit, a financial technology start-up that offers an alternative approach to financing affordable and compelling professional training programs. This can include anything from getting a commercial truck driving license or a crane operator certification to an Associates degree in nursing from a technical college or a certificate in web development. Founded in 2014, Climb finances alternative education costs for students at hundreds of schools across the country that it has pre-qualified based on a track record of meaningfully improving graduates’ earning potential. Prior to onboarding a school onto its platform, Climb evaluates its ROI potential by analyzing graduation rates, job placement rates, and the increase in pre- vs. post-program salaries, compared to the total cost of education (including loans and lost wages while in school). By vetting schools for quality as well as their ability to deliver results and provide affordable financing for students, Climb Credit enables students to continue their education and transition into better paying jobs.

Why We Invested

Traditional lenders tend to focus on loans for university degrees, rather than professional training, creating a significant gap in the marketplace. Climb Credit not only targets this underserved market, it offers affordable financing to students — targeting a much wider range of credit profiles — because it believes in the wage-increasing potential of the programs it finances. In January, Climb secured $50 million in lending capital from Goldman Sachs Urban Investment Group, further expanding its ability to meet student demand. As it grows, Climb will continue to drive meaningful economic empowerment for its students by helping them identify, evaluate, and finance programs that increase their earning potential.

Climb Credit’s rapid growth has been driven by a talented and dedicated team, led by CEO Angela Galardi Ceresnie. Angela is an impressive leader with a strong grasp of the business, deep industry experience, and a commitment to advancing economic outcomes for underserved students. Prior to Climb, Angela co-founded and served as COO/CFO of Orchard — an investment platform for peer-to-peer and online direct lending that was eventually acquired by Kabbage. Before her time at Orchard, Angela spent nine years running credit risk analytics teams at American Express and Citibank.

Impact

To date, Climb has originated over $100 million worth of loans to over 10,000 students across a variety of programs, including software development, UI/UX design, robotics, welding, nursing, and trucking. The typical loan size is approximately $10,000 with an interest rate of between 8.5 and 9%. On average, Climb’s programs offer a job placement rate of 80% and graduates see a median salary increase of 67%. As CEO Angela Galardi Ceresnie puts it, “By aligning school motivations with student career and salary goals, we open the door for thousands of people who want to change their lives through education.”

Press Highlight

Climb Credit Announces $50 Million in Funding From Goldman Sachs Urban Investment Group

MyVillage: Why We Invested

By Elizabeth Coston McCluskey and Sam Abbott

Working families face a number of obstacles when seeking child care, with one of the biggest barriers being supply of high-quality providers. According to the Center for American Progress, 42% of children under age 5 in the US live in child care “deserts” — places lacking adequate access to quality child care options. Due to limited availability, families can face waitlists longer than a year to place their child with a high-quality provider. Affordability is also a major factor, as the cost of child care has increased over 70% since 1985. These challenges have led to over 50% of American parents saying they are unsatisfied with their child’s current care.

Solution

MyVillage creates a community of quality home-based child care businesses benefitting both providers and families. The company is the only one of its kind with a solution proven to work across the country — even in rural, Western states. MyVillage makes it easier for providers to establish and operate high-quality child care businesses by offering access to a suite of resources: a platform to connect with local mentors who can help navigate taxes and regulations, a curated teaching curriculum, business software tools, marketing support, and professional development opportunities. Using MyVillage’s platform, families can search for child care options based on price, location, and program type. They can communicate with and pay providers on the platform, and feel assured that the providers are properly trained, insured, and subject to consistent quality standards.

Why We Invested

In addition to the compelling market opportunity, we are excited to be partnering with MyVillage because of the strength of their team, their early momentum, and their potential for impact.

MyVillage’s team has a proven commitment to making a positive social impact. Erica Mackey, co-founder and CEO, has a track record of scaling impactful solutions to challenging social problems. Before MyVillage, Erica co-founded and was the COO of Off Grid Electric — a renewable energy startup based in Tanzania. Elizabeth Szymanski, co-founder and CFO, was previously the CFO for TENA, an innovative Tanzanian recycling company.

MyVillage’s model has resonated with both existing and new in-home child care providers, and has enabled them to establish a foothold in Montana and Colorado. To date they have recruited 25 providers and have 90 children in care.

The model has the potential to reach underserved communities in both rural and urban settings, giving all children the opportunity to receive high-quality care. While access is a problem across the US, rural and Hispanic communities face a disproportionately high shortage of supply, and affordability is often a challenge for high quality care.

Impact

MyVillage seeks to increase the number of children under five receiving quality child care, to improve the accessibility and affordability of quality child care, and to provide economic empowerment for in-home child care providers. Quality early childhood education is crucial for brain development and prepares children for kindergarten. Roughly half of all low-income 5-year-olds in the US are not ready for kindergarten, putting them at a disadvantage from the very start of their formal education. MyVillage will equip more children to succeed as they enter school.

The company also empowers in-home child care providers to earn up to double their current wage, which averages $11.50 per hour, while monetizing their homes through a meaningful career that supports work-life balance. Through MyVillage, providers can also take advantage of professional development opportunities.

PadSplit: Why We Invested

By Elizabeth Coston McCluskey and Sarah McGraw

As more and more people migrate towards urban areas in search of education and economic opportunities, cities and suburbs across America are experiencing a housing crisis. Complicating matters, new housing production has not kept up with demand. Taken together, this imbalance has led to a rapid rise in home prices that has displaced lower income families and workers.

By affordable housing standards, households are considered cost-burdened when they spend more than 30% of their gross income on housing expenses, regardless of income level. Today, 48% of American workers earn less than $30,000 per year. This would leave almost half of American workers with just $750 per month for housing — an impossibility in many U.S. cities. With limited options, too many Americans are faced with an impossible choice — overspend on housing, thus threatening financial security, or move away from city centers, increasing transportation costs and time strains.

Solution

PadSplit is helping address this market inefficiency by expanding the existing housing supply, without requiring government subsidies. PadSplit is a digital housing marketplace that allows private landlords to convert single-family homes into affordable, co-living residences. These residences are fully furnished, renovated up to specific standards, and include private bedrooms alongside a shared kitchen and common space.

Individuals seeking housing are matched with options closest to their place of employment and become members of PadSplit. Once a resident moves in, their membership is paid week-to-week through the platform to match paycheck cycles, and includes all utilities, on-site laundry, parking and internet access. Average costs for PadSplit residences hover around $550 per month and no long-term commitment is required. PadSplit is also launching a savings platform for members.

Why We Invested

PadSplit offers a secure and affordable solution for a large, yet underserved, segment of working-class adults who face severe cost burdens when seeking suitable housing. The market is complex, however the team — led by Founder and CEO Atticus LeBlanc — has deep experience across real estate and affordable housing, as well as a thoughtful approach to navigating the legal and regulatory environment. They believe in building partnerships with all stakeholders — including members, property owners, city governments and NGOs — to ensure compliance with local standards and Fair Housing requirements. This has earned them support from Enterprise Community Partners and Urban Land Institute, among others, as well as generated excitement about the model’s potential across the sector.

Impact

By providing affordable housing solutions, PadSplit aims to radically improve the financial lives of working-class Americans while enabling them to live within reasonable commuting distance of their place of employment. To date, the company has secured and placed over 200 individuals, helping them save an average of $460/month between housing and transportation costs. Consider the case of Tiffany Ellis, who moved to Atlanta in the summer of 2017 looking to start over after a series of personal setbacks. After securing a job as an overnight security guard, as well as a PadSplit unit, Tiffany was able to save enough each month to purchase a car and move into her own apartment within 6 months.

By expanding the market, matching individuals with appropriate homes, and facilitating weekly payments to match income flows, PadSplit is enabling more affordable, convenient living for a critical segment of working adults.

Press Highlight

“This cohousing startup wants to help the working class”

Candidly: Why We Invested

By Elizabeth Coston McCluskey and Tasha Seitz

Editor’s note: In 2022, FutureFuel rebranded to Candidly.

Challenge

Student debt has reached a crisis level. Recent estimates show there are 44 million borrowers in the US owing a total of $1.6 trillion in student loan debt, with those figures continuing to grow. The average student in the class of 2016 has $37,172 in student loan debt from 4 to 6 different loans. Beyond those staggering numbers, the student loan industry can be opaque and difficult to navigate, especially for inexperienced borrowers. Meanwhile, employers’ benefits packages skew towards savings and retirement instead of the more pressing issue for many of their employees — debt management and reduction.

Solution

To tackle these problems, FutureFuel.io has developed a platform and suite of services enabling employees to reduce the effective cost of their student debt. The multi-faceted platform includes:

• Roll Up — enabling borrowers to view all their loans and payment schedules in one place. By consolidating loan information in the same place, borrowers can better manage their existing student loans

• Repay — giving employers a platform to contribute directly to the repayment of their employees’ student loan debt

• Refinancing — offering a marketplace where borrowers can find the best deals to refinance their existing loans

• Round Up — providing a tool to accelerate the repayment of student debt by rounding up spare change from transactions to put toward paying down debt

• Read — educating borrowers on how to best manage their student debt

Why We Invested

Student debt poses a major challenge for an entire generation, and we believe FutureFuel.io has high potential to make an impact for several reasons. First, the team — led by Founder and CEO Laurel Taylor — has proven their ability to hustle and learn from the market, adjusting their strategy accordingly. They have strengthened their team by adding a deeply experienced financial services executive to their board. Second, FutureFuel has gained early traction with employer customers and partners including Colonial Life, First Data, and Student Choice. In initial pilots, 60% of employees have refinanced via the platform. Third, the breadth of FutureFuel’s product offerings enables them to upsell within employers and provides an array of tools to combat student debt.

Impact

FutureFuel’s platform gives employees the opportunity to dramatically reduce the overall cost of their student debt. Through refinancing alone, it is estimated that FutureFuel users can save $19,000 and reduce their interest by 1.7%. Employer contributions through Repay and accelerated repayments through Round Up also give employees the chance to more quickly eliminate their debt, while additional resources like Roll Up makes organizing and managing loans easier. Finally, FutureFuel gives employers a platform to align their benefits packages to better meet the needs of their employees.

Press Highlight

This ex-Googler thinks she’s found the trick to end Millennial job hopping | Business Insider

CancerIQ: Why We Invested

By Elizabeth Coston McCluskey and Tasha Seitz

10% of people have a genetic predisposition to breast, ovarian or colon cancer, and the field of genetic testing to identify those populations is moving very quickly. Understanding an individual’s risk factors through genetic testing can inform a personalized cancer screening and care plan that will increase the odds of early detection and enhance survival rates, yet many individuals whose family histories suggest they are candidates are not being tested. This issue disproportionately affects African American women, who have three times the genetic risk of early onset, aggressive breast and ovarian cancers. Even when individuals do get tested for hereditary cancer risk, they often aren’t receiving care plans that reflect current national recommendations as the field is evolving and there are not enough professional genetic counselors to meet demand.

Solution

CancerIQ’s workflow process automation system — developed for cancer centers, breast centers and OB/GYN practices — collects family history information and automatically identifies patients who qualify for genetic testing, then streamlines the genetic test ordering process and records test results alongside recommendations for care plans based on the test results (whether positive or negative), and helps providers track and manage patient adherence to care plans to ultimately reduce risk over time. By streamlining the upfront process for genetic testing and leveraging technology to connect with current national recommendations, CancerIQ ensures that more individuals have the appropriate, personalized care plans in place to detect cancer early and treat it more successfully — or prevent it from occurring in the first place.

Why We Invested

Each year, over 450,000 Americans are diagnosed with breast, ovarian or colorectal cancer, and CancerIQ’s platform enables patients to take advantage of genetic screening and has the potential to drive early detection and improve survival rates. The company was founded by a strong mother-daughter team with both business and medical credentials. Dr. Funmi Olopade, a founder and board member, is a professor of medicine and human genetics and director of the University of Chicago’s Cancer Risk Clinic and has led important research in the field regarding hereditary cancer risk for specific patient populations. She has been part of a collaboration to create training in genetic counseling to generate more capacity to conduct, interpret and apply genetic risk screening to develop personalized patient care plans. Feyi Olopade Ayodele leads the company as founder and CEO and has a background in private equity and investment banking. Prior to launching CancerIQ, she served as project manager at the University of Chicago’s Center for Clinical Cancer Genetics where she developed a data platform to drive medical research in oncology. Ayodele and her mother — who took a sabbatical from the University of Chicago — joined with analytics specialist Haibo Lu to start CancerIQ.

The company has strong customer traction (30+ multi-year contracts, and renewal revenues and internal expansion across multiple health systems) and a distribution partnership with Myriad, the largest genetic testing provider. This partnership has the potential to accelerate adoption of CancerIQ in the market, and the company is already generating new customer opportunities from that relationship. They are also in late-stage discussions with a second large genetic testing partner and other specialty HIT vendors that will provide them additional reach into the market.

Finally, the field of genetic testing and understanding of hereditary risk factors is advancing quickly, and we believe that CancerIQ’s technology can successfully address the limited supply of professional genetic counselors by automating the process around testing and recommendations.

Traction

CancerIQ has several dozen paying customers, who have have screened over 150,000 patients and ordered more than 6,000 genetic tests. The Myriad relationship has potential to accelerate customer adoption. The value the company has created for Myriad has made it compelling for other genetic testing labs to partner with CancerIQ, and a number of additional potential partnerships are now in their pipeline.

Impact

Earlier diagnosis of patients with high hereditary cancer risk will lead to better health outcomes, and the company conducted a two-year study with OSF HealthCare’s Center for Breast Health to demonstrate their ability to enable early detection. Dr. Olopade’s research suggests that CancerIQ can have a disproportionately higher impact on African and African American populations, given their higher risk for early onset, aggressive cancers. In addition to financial metrics, we expect to track the number of patients screened by ethnicity, geography and customer type, the number of patients implementing personalized care plans based on CancerIQ recommendations, and the number of patients diagnosed early.

Glimpse: Why We Invested

At Impact Engine, one of our four impact areas of focus is education. Time and time again, we have heard from companies that the best edtech products have to fight against mediocre ones because of the relationship-based nature of sales in many school districts. The reality underlying that frustration is that administrators haven’t had great tools to foster informed decision making. Traditional achievement systems simply present outcomes without capturing the data in the context of what educators or programs did and how effective their actions were at impacting student outcomes. At the same time, traditional financial systems have lacked the correlations between expenditures and student achievement. As a result, districts have struggled to align their spending on products and programs that produce the best student outcomes.

Solution

Our most recent investment in Glimpse seeks to address that challenge. Glimpse has developed a data platform that connects budgeting systems with data on student outcomes, enabling districts and schools to calculate an eROI, or education return on investment. What drew us to this investment was the potential for systems change within education. By providing data to districts, Glimpse enables decision makers to include impact in their purchase decisions, and it also helps them ask the right questions when they see discrepancies in performance within or across schools. The US spent $12 billion on edtech alone in 2017, and that figure is substantially higher when you consider spending on programs and curriculum. We believe Glimpse has the potential to meaningfully impact how those dollars are spent.

Why We Invested

In addition to the compelling market opportunity and potential for impact, we were impressed by the team. The company is led by co-founders Nicole Pezant and Adam Pearson, both experienced edtech entrepreneurs who previously worked together at Chalkable. They’ve demonstrated an ability to grow and scale (and exit) companies in this space, and we are excited to work with them. Despite a small team size, the company had already achieved meaningful traction by the time we invested.

Impact

While Glimpse is able to infer correlations, they are not utilizing randomized control trials (RCTs) and do not purport to evaluate causality. However, they do provide a more granular level of detail that helps administrators connect the dots between spending and outcomes. To that end, the impact metrics that we are tracking for the company include the spending efficiency or eROI (the % of spend that is driving student gains); the number of districts using Glimpse, including a breakdown of Title 1 schools and the number of students within each district; and improvements in student performance.

Our Investment

We invested in the seed round that Glimpse raised earlier this summer which will enable the company to invest in product, grow sales, and demonstrate improvement in spending efficiency at customers. We look forward to supporting the company alongside co-investors Fresco Capital, Govtech Fund and GSV AcceleraTE.

Fixer: Why We Invested

The United States is currently faced with an alarming labor shortage of skilled workers in the trades. Over 60% of skilled tradesmen are over the age of 44, and the industry will struggle to fill these roles as younger generations continue to seek employment in other industries. 78% of firms report having difficulty finding qualified workers to fill these types of positions. The construction industry lost 1.5 million workers during the Great Recession. As a result, skilled trade jobs have consistently ranked as the most difficult position to fill since 2010, with 62% of companies struggling to fill these positions.

Solution

Fixer offers a compelling, scalable solution to address this labor gap by providing a career entry point and development for women and minorities while also delivering a superior customer experience. Their on-demand home repair service features transparent pricing as well as convenient online booking and payment. The company identifies overlooked talent and develops their skills with progressive training in customer service, home repair, and maintenance. “Fixers” (the employees of Fixer who provide handyperson services) have access to a variety of learning opportunities, ranging from informal sessions with fellow workers, to online courses and classroom-based certification training provided by the company. The curriculum also includes work in the field with mentors in order to gain hands-on experience. Ultimately, customers benefit from Fixer’s intensive training program in the form of impeccable service and high quality of work.

Why We Invested

Fixer boasts an extremely strong management team. The company was founded by Mike Evans (co-founder and former COO of GrubHub) and a handful of ex-GrubHub product, operations, engineering and marketing veterans who have a proven track record of success. Also, Fixer is seizing a large, attractive market opportunity by vying to become a nationwide, customer-service oriented brand for home maintenance and repair. In addition to their impressive management team and the large market opportunity, we are also excited about the potential for impact at scale. Since there is a limited supply of experienced tradesmen, Fixer’s focus on recruiting underrepresented populations to join the trades as novice fixers becomes a clear competitive advantage for the company.

Impact

Fixer’s goal is to bring more people into the trades, giving them measurable and valuable skills, which will provide them greater economic security and mobility, particularly for those currently earning less than $50,000 per year, as well as for underrepresented populations such as women and minorities. Typically, we invest in products where the customer is “buying the impact” (e.g. a school administrator wants better education outcomes), so that the impact is directly driven by sales. In Fixer’s case, the customer is buying a convenient service, but because there is a shortage of skilled handy-people, the social impact is a key requirement for Fixer to grow its business (i.e. they must successfully train people to provide a great service).

One of the biggest variables on impact will be who those employees are and whether the company is hiring the underserved. The leadership team at Fixer has a strong commitment to impact, and to reflect that commitment, the company registered as a public benefit corporation. As the training gets underway, we plan to track the number and type of new practical skills acquired by Fixers, as well as the demographics of those entering or re-entering the trades.

Our Investment

We invested in the seed round that Fixer raised in May, which will allow them to continue to grow the business, to refine their model, to build out the curriculum for their training academy, and to hire their first group of novice fixers. We look forward to working with Mike and the rest of the Fixer team as they continue to grow the business alongside co-investors Founder Collective and Hyde Park Venture Partners.