Montreal-based start-up EdTech Paper closes C $ 123 million (US $ 100 million) Series C funding as the company seeks to develop its educational support software for K-12 students .
“There are a ton of resources available for families with means and almost nothing available for everyone. “
The investment was led by US venture capital firm Institutional Venture Partners (IVP), with the participation of returning investors Framework Venture Partners, Bullpen Capital, Reach Capital, Birchmere Ventures, Salesforce Ventures, BDC Capital and ETW.
To date, Paper has raised nearly C $ 150 million (US $ 121 million). As part of the deal, Tom Loverro, general partner at IVP, has joined Paper’s board of directors.
The Series C funding is Paper’s third funding round to close in the past 18 months, and also follows a year of growth for the startup, which has managed to grow its user base by 20 times. With this new funding, Paper seeks to continue to develop its offer to support more actors in the education sector, which has undergone dramatic changes since the start of the COVID-19 pandemic.
Founded in 2014, Paper (formerly known as GradeSlam) offers an educational support system for students in Kindergarten to Grade 12. The startup’s mission is to provide students with an equal opportunity to succeed academically and to help school districts cost-effectively support large-scale learning.
Paper’s educational support system provides students with high-dose tutoring, which typically refers to one-on-one tutoring or tutoring in very small groups, at least three times a week. The startup partners with school districts in Canada and the United States (US) and, for a fixed cost, students can access homework help, commentary writing, and study support. Teachers can also customize tutoring with virtual teaching assistants.
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Paper was founded by CEO Philip Cutler, who worked as a teacher in the K-12 school system, and recognized a lack of equity in the education system for students who needed academic help.
“I spent some time analyzing the options available for these families and came to the conclusion that there were a ton of resources available for families with means and almost nothing available for everyone” , Cutler told BetaKit.
The COVID-19 pandemic has brought about a sudden, global shift away from the physical classroom. Online learning and other educational technology startups rose to prominence during this time as many sought new ways to educate students from a distance.
While the pandemic has been a boon for EdTech startups, such as Toronto-based Top Hat, it has also highlighted several challenges associated with K-12 distance learning, including how whose students can receive personalized support.
According to a 2020 discussion paper, the average student will return to school with only 63-68% of learning gains in reading and as little as 37-50% of math learning gains per year. compared to a typical year.
Tutoring provides an opportunity to fill this gap and help students better understand and retain information from personalized tutoring. The generally high cost of tutoring is usually borne by parents, especially those who can afford such services. For those who can’t, students are more likely to fall behind.
The paper seeks to fill this gap. The startup claims to have experienced marked growth over the past year, especially following the major disruption to education caused by COVID-19.
In 2020, the startup’s user base stood at 50,000 students. Today, Paper claims to have supported over a million students. The support system is currently used by 100 school districts and the startup has grown its tutor base from 100 to 1,000 tutors. Paper’s corporate team has also exploded over the past year, from 30 to over 130.
Cutler noted that unlike many e-learning companies, Paper did not directly benefit from school closures due to the pandemic, and claimed the business was growing rapidly before COVID-19.
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What has changed, Cutler said, is an increase in investments in the physical and network infrastructure of schools. With the infrastructure in place, Cutler said the next step for schools is to effectively deploy this new technology, which Paper has benefited from.
The CEO said the pandemic has also highlighted the fairness gap that exists for students, which Paper seeks to close. He noted that Paper aims to make tutoring accessible not only to families who can afford it, but to all students in a given district.
“This whole idea of being able to support students and doing it fairly hasn’t been to the fore,” Cutler said. “Districts were well aware of these gaps, but they never had to really make these changes. Now with everything that has happened, they’ve really invested in it.
With the new funding, Paper seeks to continue to grow and invest in its education support system. Cutler plans to continue to work collaboratively over the next several months with school districts to ensure that every district and every student can benefit from Paper’s offering.
“This is a very significant investment in EdTech, particularly in the Canadian EdTech ecosystem and the Canadian K-12 EdTech ecosystem, which is virtually unheard of,” said Cutler. “This is a big step forward that will hopefully inspire many other businesses in Canada and even elsewhere to see that you can really create huge transformative companies in education.
Unsplash image source. Photo by Giovanni Gagliardi.