Batch 7 (Where I Would Invest)

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Vemo Education works at the intersection of education and finance, helping colleges and universities to power income-based student financing models.  Our team of education finance experts design and deploy programs that enable postsecondary institutions to signal institutional commitment to their students by aligning the cost of college with student outcomes. Our platform helps higher education offer flexible and personalized financing to students and families.

Last Funds Raised: Seed Undisclosed, December 2016

Headquarters: Oakton, Virginia

 

What I Like:

  • I really like the education technology space because there is such a large opportunity and the industry is not overly mature yet.
  • This company is also trying something completely new which is the income-sharing approach type of student financing as opposed to traditional student loans.
  • The company has partnerships with universities already and has proven their business model by students using the service today.
  • There is a strong vetting process for students to be onboarded to the platform, so that investors can be more comforted that the students will turn out to be successful investment vehicles.
  • The company has an admirable mission of wanting to improve access to higher education and eliminates burdensome student loans, with a friendlier approach.
  • The founding team has strong backgrounds that meet all the requirements to expand Vemo Education, one of the most paramount of those being a credit/risk analytics specialist.

 

What I Don’t Like:

  • The fact that Vemo is pioneering a new solution to student financing means that people may be hesitant to use it.
  • The returns have not been proven yet and won’t be for a few years because students need to start careers and begin paying back the investors. This will be a problem for any investment in income sharing companies because the model is brand new.
  • The firm has recently received funding, so they may not be looking for additional capital. Additionally, they may not need more capital because they might become cash flow positive depending on if a management fee is structured into their fund.

 

Conclusions:

  • This was the only company in the United States implementing the unique income sharing solution to student financing, so I believe there is a lot of potential. I do believe students and investors will welcome this as a way to make education more accessible.

 

Sidenote –

There is another company with a similar business model called Lumni that has not received any funding, but targets South America. The company is based in Bogota, Colombia and has financed nearly 7,000 students to date.


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Fulcrum Labs turns Students into Learners and Learners into Confident Subject Matter Masters. Learning shouldn’t be one-size-fits-all, like an old pair of sweatpants. We believe training should begin with personalization and engagement. It should build confidence and lead to mastery. And, it should provide insightful, actionable data to verify mastery; predict which employees might not be able to apply the training; and help evaluate and fine-tune the course.

Our personalized, adaptive learning and predictive analytics (PALPA™) SaaS platform is a result of this philosophy. Through real-time performance and behavioral data, Fulcrum’s machine learning algorithms deliver the right content at the right time. The result: a combination of mastery and confidence that reduces Scrap Learning (the 45-80% of training that’s never applied). Your employees are more engaged and capable of applying the training back to the workplace. Our customers have seen tremendous results in markets including commercial aviation, healthcare, manufacturing, certification prep and higher education. And Fulcrum was recently awarded both Brandon Hall Bronze for Best Advance in Compliance Training and Gold for Best Advance in Technology for Testing and Learning Evaluation.

Last Funds Raised: None, Founded 2014

Headquarters: Los Angeles, California

 

What I Like:

  • The company is combining artificial intelligence and education technology, which are both very hot investment spaces at this time.
  • The firm is targeting both employee education and higher education, which give it a substantial market size opportunity. However, it will be important for the company to focus on one market to gain strong footing before spreading themselves too thin.
  • The company seems to have strong traction in a relatively short period of time without having to take any funding. By starting out as a consulting firm, the company got strong experience and then developed a customized solution based on the constant problems they encountered.
  • The founder has experience both in the corporate world and in entrepreneurship through his long career. The team does not seem to have an engineering founder, which is a bit concerning considering the company has strong engineering requirements considering it is AI. Although it is possible the engineer does not have a Linkedin or public online presence.
  • The company has not raised any funding yet, so it could be a great opportunity to be first money in.

 

What I Don’t Like:

  • The firm does not have an engineer listed as a founder or full-time employee, so it is concerning because the company is so software driven.
  • The Learning Management System space is becoming very crowded, so Fulcrum Labs will have to differentiate themselves when it comes to gaining clients.
  • The company does not list any marquee companies or universities that use them, so it makes me wonder how much traction they really have in the competitive market.

 

Conclusions:

  • I would want to talk with the founders and hear their vision for the company as well as their current metrics including: users, user growth, revenue, revenue growth, profitability and how they intend to scale.

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Snapwiz works with publishers to offer a unique learning solution that is personalized, powerful, and accessible everywhere using web, smartphone and tablet. Snapwiz’s adaptive learning platform is ideal for rapid learning. It creates a customized course based on students’ skills, available time, and what they need to learn to maximize their test scores. Snapwiz isn’t just adapted for some: it’s adapted for every individual.

Snapwiz’s platform makes courses available to students when they are on the move. Students can access their study plans and course material on the web, on their smart phone, or on their tablet, anywhere and anytime.

Snapwiz utilizes learning tools such as computer adaptive quizzes, entertaining video lessons, step-by-step problem solving videos, virtual flash cards, and other stimulating activities to transform passive content into an interactive and engaging learning content.

 

Last Funds Raised: $1.1M Venture, April 2011

Headquarters: Fremont, California

 

What I Like:

  • The company has clear traction with 21,000+ schools and colleges utilizing their platform.
  • Snapwiz is targeting the personalized learning sector, which is expanding and will only grow as time goes on and parents want the best education for their children.
  • The company has clearly defined their market and offers products that are helpful for problems that a lot of schools constantly come across.
  • The founders seem to have the necessary skills required to grow the company from an engineering and leadership standpoint.
  • The company has only raised money once and it was back in 2011, showing how successful it has been over the years not requiring additional capital. I believe this provides an opportunity to inject more capital in order to scale revenue growth given their strong client-base.

 

What I Don’t Like:

  • As another Learning Management System company, the space is highly competitive, but I like this company because of the traction they have in their 21,000+ schools.
  • Since the company has achieved such high penetration it will be up to the team to increase revenue per client and get more money out of each school they are working with. This may be difficult given that their product is fairly cheap in its current state.
  • There must be a reason the company has not raised additional capital and it could be they don’t want/need it or that VCs have not been comfortable after hearing their pitch.

 

Conclusions:

  • Given the company’s strong client-base I believe this presents a great opportunity especially considering the early stage of fundraising. New money and new ideas could be just what the company needs for continued growth.

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Firecracker is a next-generation mobile and web learning platform that helps students study the right material in the right way at the right time. It’s like giving them their very own personal tutor — 24/7.

We help premedical and medical students rapidly learn — and efficiently retain — the key facts they need to ace their classes and standardized exams, and provide evidence-based care in the clinic.

Firecracker was started by Harvard physicians, based on neuroscience and continuously validated by data. Content written by top students, residents and attending. Technology developed by world class engineers and statisticians.

Last Funds Raised: Bootstrapped, Founded 2009

Headquarters: Boston, Massachusetts

 

What I Like:

  • Very specialized solution to a targeted demographic that has gained strong traction across the medical student community. 20% of medical students use Firecracker to study for their exams.
  • I believe the same process for teaching could be applied to other post-graduate types of learning, such as law, to broaden the companies market and get access to more users.
  • The company has a strong team of people with technical, entrepreneurial and business experience representing a group that could expand the company.
  • The company was also bootstrapped with money from the founders, so they have skin in the game and have clearly demonstrated their passion after working on the project for 8+ years.
  • The company was recently announced as a finalist in an education technology competition because of their longevity and proven success in helping students.

 

What I Don’t Like:

  • My largest problem with the company is that the founder/employees are not full-time and have other jobs on their Linkedin’s. For example, the founder, Ben Williams, is working at a venture capital firm as of 2016.
  • The fact that the employees have started to work for other firms makes me think that the company may have plateaued and the team simply lost interest because of a lack of opportunity.
  • The product is hyper focused on medical students, which is a positive initially, but I think becomes a negative since the market is so small. The potential market size may not be enough to justify the riskiness of an investment.

 

Conclusions:

  • The company has such a strong userbase that it seems like a shame to just let it go to waste because I believe that they have already achieved one of the hardest parts and now they just need to scale and serve a broader audience.

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