Tech Training and Apprenticeship Startup Kenzie Academy Raises $4.2M

Digital Learning

Tech Training and Apprenticeship Startup Kenzie Academy Raises $4.2M

By Sydney Johnson     Jul 18, 2018

Tech Training and Apprenticeship Startup Kenzie Academy Raises $4.2M

When coding bootcamps first arrived on the (predominantly coastal) scene, they pitched themselves as alternatives to the college experience. But a series of closures have raised questions about whether these short-term skills-training programs are can be financially sustainable—or deliver results for students and investors.

Now Kenzie Academy, a tech training and apprenticeship program, wants to usher in a new era of skills-training programs—and has raised a $4.2 million seed round to attempt to do so.

Founded in 2017, Kenzie Academy is two-year program that currently focuses on software engineering skills, and plans to soon offer curriculum around user design and digital marketing with money from the seed round. The program costs $24,000 per year, and students can choose an income-share agreement, which allows students to delay tuition payments until they complete the program and land a job that pays at least a $40,000 salary.

Like many startup entrepreneurs, Kenzie’s CEO and co-founder Chok Leang Ooi claims he wants to do things a little differently. For starters, the second year of the program is an apprenticeship, where students work in Kenzie Studio, the company’s consulting arm. Part of the seed round will be used to build out that consulting arm, which will partner with tech companies for projects that students can work on to get real-world experience. And money from those companies will go towards supporting the students and Kenzie. (Partner companies have yet to be determined, according to Leang Ooi.)

Kenzie Academy “seems to be a part of the growing interest in next-gen forms of apprenticeship,” says Sean Gallagher, founder of Northeastern University’s Center for the Future of Higher Education and Talent Strategy. Kenzie’s business model and curriculum appears to combine trendy elements in alternative education these days, such as a focus on coding skills, work engagement and now consulting elements built-in. “That itself is a trend when various online or microcredential programs are incorporating projects with real world employers,” says Gallagher.

So far the school has attracted students from a mix of backgrounds, ranging from 19-year-olds recently out of high school, to mothers with masters degrees looking to re-skill and return to work. Leang Ooi says the company also works with and has enrolled a student through The Last Mile, an organization that helps formerly incarcerated individuals reenter the workforce.

Unlike many bootcamps or other so-called college alternatives, Kenzie also plans to partner with traditional higher-ed institutions. It has already teamed up with Butler University, which is also an investor in Kenzie Academy. As part of the partnership, students who complete Kenzie Academy’s front-end web development, full-stack web development, and software engineering programs will receive a joint certificate from Kenzie Academy and Butler Executive Education, the university business school’s continuing education arm.

While other tech-training companies like Trilogy Education have also turned to traditional universities as strategic partners, Gallagher says it’s still “somewhat rare to see that linkage from non-institutional providers and bootcamps and actually awarding a higher education credential.”

Another major focus of the training program will be to develop tech talent in cities that are not major technology hubs like New York, Austin or the San Francisco Bay Area.

“Tech jobs are concentrated on the coasts. Our goal is to provide high quality talent in the rest of America, primarily Middle America, so that other companies besides Amazon might find an attractive hub for expanding,” says Leang Ooi. “Our goal is to supply talent so [companies] don’t have to move to San Francisco.”

There’s a bit of irony in that claim, as the company is headquartered in San Francisco. (Its one campus to date, though, is in Indianapolis.) To reach even more cities, Leang Ooi says the company is also developing a digital platform to offer online and hybrid education courses for students outside of Indianapolis.

Gallagher points out that the company’s geographic focus matches other patterns he sees in technology and workplace training spaces. “Where they are located is part of the trend to develop Middle America-types of cities… By being a player in a smaller market, there may be more community support and engagement. You can imagine if this started in New York, there would be a host of competitors.”

Yet investment data analyzed by Quartz shows that Silicon Valley investment firms participated in only around 10 percent of venture deals from 2012-2018 in Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin.

It’s too early to tell how this vision will materialize. The company just launched its first cohort in January 2018, and students will complete a year of technical training before entering an apprenticeship at the start of 2019.

Kenzie’s latest funding round was led by Rethink Education. Learn Start (a fund of Learn Capital), Gratitude Railroad, Kelly Services and Butler University also participated in the round. The seed round follows a $1.6 million seed raised in November 2017, bringing the company’s total amount raised to $5.8 million.

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