According to Y Combinator’s estimates, today, there are more than 100 startup accelerators in the U.S., which is almost awe-inspiring considering that there were only four as recently as 2007. While the number of accelerators and incubators continues to rise, popping up in nearly every vertical, Education has been slower to get the memo.
However, with early-stage capital beginning to pile into the EdTech space, it happens to be an excellent time to start an education company. Of course, it’s not as easy to start an EdTech company as “wanting to change the world.” Luckily, over the last year, we’ve seen a reversal of the trend, with a handful of education-focused accelerators opening their doors. Even the 70-year-old Kaplan and publishing giants like Pearson have hopped on the train.
Today, one of the veteran EdTech accelerators is adding significantly more fuel to the fire, with its very own Start Fund. Taking a page out of the TechStars and Y Combinator incubation texts, Imagine K12 launched in 2011 to offer support to education-focused founders in the form of a little seed capital — $14K to $20K in exchange for six percent equity — alongside mentoring, coaching and free workspace. Now, two years later, the accelerator is kicking funding for each startup up to $100K.
Initially, as we wrote last year, founders Geoff Ralston, Tim Brady and Alan Louie weren’t sure that the accelerator model would jive with education. But, in spite of early reservations, Imagine K12 received 100 applications for its first batch, and it’s been struggling to keep up with the interest since.
In October, Imagine K12 graduated its third cohort of startups, bringing its total to 30 companies, with 9 more set to join its fourth batch.
The founders tell us that Imagine K12 startups have raised more than $30 million collectively thus far and that products created by Imagine K12 grads are now in use in more than 400K classrooms. Notable and quick-growing graduates include ClassDojo and Educreations, which up until its third batch had been its two “most successful incubations,” the founders said, with ClassDojo reaching over 4 million teachers and raising $1.5 million from Paul Graham, Ron Conway, Jeff Clavier, Flixter CEO Joe Greenstein, OpenFeint Founder Jason Citron, Start Fund and General Catalyst — to name a few.
Educreations, in kind, has taken its whiteboard tutorial creator to over 12,000 schools in 117 countries and has raised $2.2 million from Accel and NewSchools Ventures, among others. From its most recent batch, NoRedInk is already beginning to stand out, having raised some early seed money and having begun to scale rapidly since we last wrote about the grammar-mastering startup in October.
Today, Imagine K12 is looking to make these startups the norm rather than the exception, by giving them the runway they need to take their businesses to the next level. And, for better and for worse, that starts with seed capital. Going forward, each Imagine K12 startup will receive $100,000 upon acceptance into its program — an $80K to $88K hike when compared to the seed capital behind its first three batches.
The new capital comes out of Imagine K12 Start Fund, a new fund launched by the accelerator’s founders, thanks to contributions from investors like Paul Graham, Yahoo co-founder David Filo, Angela Filo, LinkedIn CEO Jeff Weiner, Chegg CEO Dan Rosensweig, NewSchools Venture Fund and GSV Asset Management.
The accelerator’s new fund now puts the capital offered on par with TechStars and Y Combinator — each of which has their own version of the “Start Fund.” In fact, Imagine K12 will now offer more seed capital than YC’s new fund, YC VC, which offers $80K per startup.
With the new starter investment, each Imagine K12 company will now receive up to $20K directly from Imagine K12, along with a convertible note for $80K from its Start Fund — the size of which the founders attribute to “the early success of its graduates.”
“Imagine K12 companies have invented products that are now used by over 10 percent of US teachers,” Brady says, and the additional funds will give companies a longer runway to build out their products, partner with teachers and try to overturn the legacy, broken infrastructure that still runs rampant in education today.