Altius Education, an online college service provider based in San Francisco, raised $8 million in Series A funding co-led by Maveron LLC and Spark Capital along with participation from The Noah Fund.
Altius Education Inc, a San Francisco-based for-profit company that partners with non-profit universities to launch fully accredited online colleges, today announced that it has closed an $8 million Series A funding round co-led by Maveron LLC and Spark Capital along with participation from The Noah Fund. The company also announced the addition of Maveron Partner Amy Errett and Spark Capital Partner Alex Finkelstein to its board of directors.
“Maveron and Spark are ideal financial partners to help fuel our growth,” said Altius Education CEO Paul Freedman. “Maveron has significant experience in developing high quality consumer brands, and is unmatched in its knowledge of the education market, with its prior investments including online education leader Capella Education Company (Nasdaq: CPLA). Spark has a phenomenal track record in funding technology, consumer and media companies. The pairing of these two firms, which bring tremendous experience and strategic support in the tech, consumer and education sectors, is an enormous advantage for us.”
Since its inception in 2007, Altius Education has quickly emerged as an innovator in designing and building high-quality online postsecondary education degree programs in areas that are underserved by incumbent institutions. Addressing the growing gap in the higher education market at the junior college level caused by resource constraints and funding cuts at many community colleges, Altius Education has partnered with Tiffin University to establish Ivy Bridge College. Ivy Bridge College offers an online two-year program that provides students an accredited, affordable, and flexible path to admittance into a high quality four-year university program. In order to ensure the success of its students, Ivy Bridge College offers 24×7 tutoring and pairs each student with an academic coach. In its first year, Ivy Bridge College enrolled students from around the country, affirming the demand for its unique positioning as a low cost community college partner that prepares students for a traditional four-year degree. In addition, Ivy Bridge College currently maintains student retention rates that are significantly higher than those of its largest competitors, demonstrating the value of its student service model.
Ivy Bridge College sets itself apart from other distance learning programs through transfer agreements in place with 24 partnering four-year institutions that have agreed to accept credits earned at Ivy Bridge, paving the way for Ivy Bridge students to pursue bachelor degrees when they complete their associate degrees. In addition, every student is assigned a success coach to support his or her academic pursuits. “The partnerships we have in place with four-year schools, and the mentor program, are unique to Ivy Bridge and are major selling points that truly differentiate us from our competitors,” said Freedman.
“Many colleges are aware that they lack both the resources and web recruitment acumen to be competitive online providers despite having expert faculty and established programs. With Ivy Bridge, Altius Education has demonstrated its expertise in leveraging existing infrastructure and academic assets to create a unique brand that is able to attract and retain a targeted student population,” said Maveron Partner Amy Errett. “Altius Education CEO Paul Freedman comes from an impressive educational background and has woven that experience into the DNA of the company. We believe Altius Education represents a significant opportunity and is a perfect fit for us, intersecting our expertise and leadership in the education space with our broader consumer Internet investment strategy.”
“Altius Education clearly stood out as an investment opportunity for us,” said Spark Capital Partner Alex Finkelstein. “Paul Freedman has previously achieved a meaningful level of success in the education market as the founder of Academic Engine, a student recruitment technology company, which he sold to Hobsons Inc, a subsidiary of the Daily Mail and General Trust (UK: DMGT). We were impressed with his vision and business model and the company’s ability to generate significant revenue prior to securing outside capital.”
Altius Education will use the new capital to fuel the growth of Ivy Bridge College and launch additional programs in other underserved educational areas such as preparing students for careers in a sustainable economy and addressing the shortage of qualified workers in the healthcare industry.
Online learning is an increasingly popular alternative to classroom instruction that makes higher education affordable and accessible, and enrollment nationwide is soaring. According to the Aslanian Group, a higher education market research firm, nearly 12 percent (2.1 million) of all students at degree granting institutions in 2007 were enrolled solely in online programs. Enrollment in online higher education is projected to nearly double by 2013. A U.S. Department of Education study published earlier this year found that, on average, students in online learning conditions performed better than those receiving face-to-face instruction.
About Altius Education
Altius Education, Inc. partners with academic institutions to help them unlock the potential of their existing curricula. By establishing separate legal entities and providing them with the key financial and strategic resources, we are able to transform academic institutions’ existing curricula into fully-formed online college programs. Our strategy is to identify gaps in the postsecondary education market and leverage our partnerships, capital, online learning capacity and marketing experience to create focused college programs to serve market needs. We have proven success with our first college, Ivy Bridge College, which provides innovative online associate degree programs with unparalleled access to mentoring and support and transferability to four-year colleges and universities. Privately-held Altius Education is backed by top-tier venture capital firms, Maveron and Spark Capital. For more information, visit www.AltiusEd.com.
Maveron is a leading venture capital firm founded by Dan Levitan and Howard Schultz. Maveron’s mission is to partner with entrepreneurs in the creation of extraordinary consumer-based companies in order to generate outstanding financial returns. Current representative Maveron investments include fast-growing consumer companies, such as Potbelly Sandwich Works, Pinkberry and LiveMocha, and powering technology companies such as VideoEgg. Monetized investments include eBay, Capella Education Company, Shutterfly, Cranium (acquired by Hasbro), Qsent (acquired by TransUnion), Good Technology (acquired by Motorola) and lucy activewear (acquired by VF Corporation). Based in Seattle, Washington, Maveron has approximately $750 million under management and 23 active portfolio companies nationwide. For more information about Maveron, visit www.maveron.com.
About Spark Capital
Spark Capital is a venture capital firm with investments focusing on the conflux of the media, entertainment and technology industries. The partners of Spark Capital carry diverse expertise in media and technology industries with proven track records identifying and actively building market-leading companies in sectors including infrastructure (Qtera, RiverDelta, Aether Systems, Broadbus and BigBand), networks (College Sports Television, TVONE and XCOM), services (Akamai, thePlatform, Admeld) and digital media (Twitter, Boxee, 5min). With a deep network that spans technology and media, investing and operations, Spark Capital provides world-class entrepreneurs and revolutionary companies with the resources to succeed in today’s marketplace. Spark Capital has $622 million under management, and is based in Boston, Mass. To learn more, visit www.sparkcapital.com.
About Noah Fund
Noah Fund LLC is a premier investor in and advisor to education and related businesses. Noah Fund was founded in 2008 guided by the principle that investors who are passionate about the education industry can combine firm investment discipline with outsized returns. With investments across the education lifecycle, Noah Fund maintains board positions in Altius Education Inc, Global College LLC, and founded Hayground Cove Student Partners LP. For more information, please visit www.thenoahfund.com.