Degreed Co-Founders Raise $3.5 Million to Help Employees Take Training...


Degreed Co-Founders Raise $3.5 Million to Help Employees Take Training Sabbaticals

By Wade Tyler Millward     Apr 21, 2020

Degreed Co-Founders Raise $3.5 Million to Help Employees Take Training Sabbaticals

Eight years after he co-founded corporate learning platform Degreed, David Blake continues to battle a major obstacle to employees learning new skills to advance their careers—not enough time in the day.

At many companies, education often falls between the cracks in work-life balance. Employers and workers may see training while on the job as a sacrifice of the day’s to-do list and short-term productivity. And asking workers to partake in training during their time away from work can lead to burnout and lower morale. “There is an inherent tension,” as Blake puts it.

Just 2 to 5 percent of eligible employees use tuition assistance programs for education and training, according to Lumina Foundation. Forty-three percent of working adults don’t know if their employers even offer a program. Those unfavorable figures come despite increased investor attention to corporate learning, with eight corporate learning-focused companies accounting for 39 percent of edtech investing in 2019, according to EdSurge data.

Blake and fellow Degreed co-founder Eric Sharp propose a new approach to employee training through their recently launched startup, Learn In, which provides a platform to help companies figure out how to finance and allocate time for employee training. The company recently raised $3.5 million in a seed round from Album, GSV and Firework Ventures. Village Global and angel-investor Michael Levinthal also participated in the round.

The tool shows clients what programs fit best based on cost constraints and how to divide employees’ time between regular duties and training during the workday. Employers will also see data to see how much they’ve saved from investing in helping internal staff develop new skills, versus hiring for them.

The Salt Lake City-based company currently has no paying employer clients but has a growing roster of program partners, which includes Flatiron School and Podium Education. Learn In aims to help employers negotiate program discounts and scholarships for workers. And some companies may already have tuition reimbursement benefits that can go toward Learn In education programs. The IRS allows employers up to $5,250 in tax reductions for tuition reimbursement for college courses.

The company also offers to connect employees with bachelor’s and master’s programs. Program providers are responsible for delivering assessments to users who take their courses. But Learn In will help employers and managers track progress toward course completion.

Learn In looks to woo North American and European companies of all sizes and industries, particularly large-sized enterprises. Some already have sabbatical models in place for employees—Salesforce offers one week of unpaid learning time for each year of full-time employment, for example. And companies like McKinsey & Co. and Goldman Sachs have long sponsored their workers to pursue MBAs in exchange for staying with their employers.

But that latter model is ineffective for workers who can’t forgo a salary and can’t dedicate the time to lengthy programs, Blake says.

Workplace sabbaticals remain rare despite reports of cost savings when employers train existing employees instead of hiring new ones. A 2019 report from Whiteboard Advisors and commissioned by General Assembly found that companies can spend $30,000 or more on recruitment fees, advertising and recruitment technology just to hire a mid-career software engineer. Instead, the authors claim, they could spend $20,000 or less by training an existing employee in the desired skills.

For online education providers, some research suggests that shifting online education to the workplace can help completion rates. A survey published in Harvard Business Review found that just 15 percent of people who enrolled in massive open online courses earned a certificate of completion. But 58 percent of learners who received financial support from employers completed them.

Learn In employs a team of six and is still tinkering with its pricing model. The company launches at an uncertain time for American workers. The COVID-19 outbreak has some economists putting April’s unemployment rate at about 20 percent, and they expect the unemployment rate to hover at about 10 percent by the end of the year. An unemployment rate of about 4 percent is considered the ideal norm.

Blake hopes that companies consider sabbaticals as alternatives to layoffs and furloughs as they navigate COVID-19’s impact on business. “Don’t add to the layoffs,” Blake says. “This is a smarter move and a more efficient option.”

Learn In is one of the first startups to launch from The Future of Work Studio, an investment, business incubation and advisory firm where Blake and Sharp are managing partners. The other company launched by Future of Work Studios so far is BookClub, which provides a platform for authors and readers to connect.

Like Learn In, BookClub lists Blake as CEO and Sharp as chief technology officer. Blake will balance his time leading both companies and continue as executive chairman of Degreed, providing his time as needed.

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