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Stride Funding Secures $30MM Facility with Silicon Valley Bank

October 22, 2021, 07:16 AM
Filed Under: Lender Finance

Stride Funding secured $30 million of low-cost education financing from Silicon Valley Bank (SVB) to fund the high-growth asset class of outcomes-driven funding products. The warehouse credit facility will be used to fund upskilling programs for graduates of SV Academy, the premier skills and employment platform for jobseekers transitioning into technology sales and customer success careers.

Stride Funding is the leading provider of outcomes-driven funding, such as deferred tuition agreements (DTAs), across alternative and higher education programs. Stride was founded with the mission of making education and pathways to career success more affordable and accessible.

Tess Michaels, Stride's Founder and CEO, noted, "We see this strategic partnership alongside SV Academy and Silicon Valley Bank as a milestone along our pathway to invest in students and further economic mobility. Partnering with industry leaders like SV Academy and SVB bolsters our ability to deliver on our mission of serving as a catalyst for career growth and economic mobility by providing educational and career resources alongside financial support for students of all backgrounds."

The capital provided through these financing agreements will allow SV Academy to better support employer hiring demand while helping jobseekers achieve their professional potential with outcomes-aligned education financing.

SV Academy, founded in 2017 and based in San Francisco, supports more than 400 technology employers with high potential and highly connected sales talent. Through its cohort-based learning platform and employer-driven instruction, SV Academy helps employers address the global skills gap across diverse communities of jobseekers returning to work or shifting careers. To date they've created 2.3x salary uplift post-program completion for graduates and achieved greater than 90% placement rates. They are also committed to further opportunities for learners from underserved backgrounds—60% of students are women and 72% are members of underrepresented communities in the technology sector.

Stride's platform offers schools an end-to-end platform for outcomes-driven funding including marketing, customized program design, origination, underwriting, income verification, payment management, wrap-around career support, and scalable financing.

SV Academy's deferred tuition program powered by Stride and financed by SVB allows graduates to pay tuition in equal installments only in those months where they are earning at least $3,750 per month (or $45,000 annualized), thus providing much-needed downside protection and aligning the cost and value of SV Academy's upskilling programs (where the average graduate earns more than $70,000 per year).

"Offering DTAs to our learners and leveraging Stride's end-to-end platform has spurred meaningful growth at SV Academy.  In the last twelve months we've seen a significant increase in job placements while maintaining the lowest delinquency rates in the market, demonstrating the importance of aligning the cost and value of education alongside a best-in-class operational partner," said Rahim Fazal, SV Academy CEO. "We are excited to expand the partnership with Stride Funding—together we will continue to support underrepresented jobseekers looking for high-growth careers with our partner employers."

"Having access to SV Academy through the Deferred Tuition program changed my life," says Nathalie Watson, who was a full-time barista at Starbucks for three years prior to landing her new job at a marketing technology startup. "The opportunity to apply my grit and determination to acquire new skills and connections without taking on tuition risk gave me the confidence to pursue a new career quickly. After completing the program, I've more than tripled my income working remotely from my home in Summerville, South Carolina."

"At SVB we actively collaborate with industry partners, organizations and clients to promote diversity, equity and inclusion in the innovation economy through our Access to Innovation initiative," said Nick Christian, Head of Specialty Finance at Silicon Valley Bank. "We are excited to support Stride's efforts to increase accessibility and affordability for students across the nation and further SV Academy's mission to help job-seekers forge a path into the tech sector."

Rahim Fazal, SV Academy's CEO, added: "DTAs continue to be a great tool to make our employer-driven programs more accessible for jobseekers from diverse backgrounds. After reviewing the funding landscape, Stride's aligned mission, and leadership designing and managing funding programs, while creating access to capital markets became apparent, and has been essential to our growth. SVB's support for our collective work will bolster our joint efforts to elevate career and economic opportunity for students of all backgrounds. Together we will continue reshaping alternative education and supporting more learners across the US."

Stride Funding is an outcomes-driven funding platform that supports students and creates transparency around outcomes across alternative and higher education. Stride offers flexible products like deferred tuition agreements (DTAs) as an alternative to private student loans. Stride has a dual-pronged go-to-market strategy and connects with students through a host of bootcamp and university partnerships as well as direct-to-consumer channels. The company collects and analyzes meaningful earnings data across a diverse set of customers over time and seeks to drive alternative credit underwriting to transform who can gain access to financial products.

Stride has raised venture funding from GSV Ventures, Slow Ventures, Firework Ventures, Juvo Ventures, Flybridge Capital Partners, etc, and assembled a strong team with experiences across SoFi, Goldman Sachs, JPMorgan, Klayvio, IBM, Liberty Mutual, and Wells Fargo.


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