StudentFinance, a European fintech that supports education programs for individuals through revenue-sharing agreements, has raised €39 million ($41 million) in Series A funding.
In the year Founded in 2019 from Spain, Student Finance has partnered with educational institutions such as Ironhack and Le Wagon to provide financial support to those who wish to study in areas such as software development, cyber security and artificial intelligence.
It said it has developed AI models to find the skills needed in the sector and map out the most suitable education providers to fill this gap.
“We track publicly available job listing data, showing trends and fluctuations in labor demand.” Student Finance founder and CEO Mariano Kostelek explained to TechCrunch. “We also use data to analyze systemic and market changes, such as government incentives for companies to go ‘green’. This gives us information on future growth – or decline – sectors.”
in addition to, Kostelek also said Monitor salary data, which may indicate demand for certain skills.
“We are developing machine learning models that use this data to predict future labor market demand and predict future income levels.” Kostelek continued. “This is the area where we invest.
Indeed, Kostelek said it plans to use the new funding to expand its internal data and AI capabilities through strategic hiring, enabling it to better predict labor market demand.
From a student perspective, a revenue share agreement means that graduates only pay for their tuition when their salary reaches a certain level, and then pay a percentage of their monthly income back to StudentFinance in installments that vary based on that income. If they don’t get a job they don’t pay anything, even if it’s completely unrelated to their course, but if they get any kind of job that meets the income level, they’re still liable to pay.
In addition to the interest fee collected from each student, the student finance revenue stream includes fees charged to course providers for each student who begins the course.
The fourth industrial revolution
The funding comes as the World Economic Forum (WEF) predicts that more than 1 billion people will need to be retrained by the end of the decade as the so-called fourth industrial revolution brings rapid societal change with technologies such as AI and automation. Likewise, VC-backed student funding platforms have similarities to StudentFinance, including San Francisco-based YC alum Blair, New York’s Leif and Arlington’s Vemo Education.
StudentFinance is looking to do the same, but with a focus on the European market. The platform and financing are currently available in Spain, Portugal and the UK, although the institutions are raising the funds themselves by offering the platform on a SaaS basis in collaboration with educational providers in Germany and Finland. Later this year, Student Finance plans to expand its full range of services to Germany, having already received regulatory approval from the German financial regulator (BaFin).
“The need to grow the workforce has never been greater,” Kostelek said. “We are on a mission to plug this gap across Europe. We aim to expand our coverage to build the workforce of the future, especially in areas such as technology, AI and climate change.
Before now, Student Finance had raised a $5.3 million seed round of funding two years ago, and with a new $41 million cash injection, the Spanish start-up has been well-funded to support its loan capital and operating costs, as well as strengthen its funding. Hire wishes.
The Madrid-based company is also preparing to launch alternative payment options, including installments whose monthly amount is not directly linked to student income.
The Series A round includes a mix of equity and debt, though the company declined to disclose the amount. It said 70% of the round’s “funding potential” would be allocated to Spain and Germany, with the rest targeted at the UK, where it launched last year.
The equity component was led by Iberis Capital, along with Armillar Venture Partners, Mustard Seed Maze, Giant Ventures, Seedcamp, Monzo founder Tom Blomfield and former UK MP Ed Vaizey. Part of the debt was provided by French asset manager SmartLenders Asset Management.