Techtonic Group raises $2 million to transform tech hiring through apprenticeships

Creating a pathway for a more diverse talent pool to enter the technology industry has given the Techtonic Group, a development services firm that operates an outsourced apprenticeship program aimed at closing skill and equity gaps in high-tech fields, $2 million in new funding.

The capital came from education and training investment firm University Ventures and Zoma Capital.

Funding for these types of training programs has risen steadily in emerging markets where companies like Andela and Wizeline have raised nearly $150 million to bring high-paying jobs to skilled developers from Africa and Latin America.

Where the two companies are using price arbitrage between the costs of developers in emerging markets and coders in the U.S., Techtonic Group is simply offering access to talent.

The company’s program pitches itself not just as a development shop, but as a recruitment and training company connecting its clients with skilled entry-level talent. The firm’s clients actually can hire Techtonic Group apprentices at no additional cost after 1,000 hours of work together.

The company has fairly typical standards for the skills that it’s looking for, but it doesn’t require its apprentices to have a degree. Since its inception, more than 30 percent of the participants in the program have been women, half come from underrepresented minority backgrounds and one-quarter are veterans, according to a statement from the company.

Given the demands for new programmers across the economy, to most businesses it doesn’t matter where the qualified new employees come from. The company cited estimates that suggest as many as 1 million coding positions will go unfilled by 2020. And the industry’s struggle to develop and hire a more diverse workforce has been well-documented. 

“Tech companies are beginning to recognize the importance of expanding the talent pool to more diverse candidates as both a socially responsible decision and a good business practice,” said Heather Terenzio, founder and CEO of Techtonic Group, in a statement. “But hiring norms, including degree requirements, can box-out the very talent that employers want and need. Our model offers a new paradigm by enabling our clients to build software with a leading firm while they are building a team based on skills and potential, rather than pedigree.”

The Denver-based Techtonic Group was founded in 2006 as a software development shop, but it’s the company’s Department of Labor registered apprenticeship provider for software development that really attracted investors — including University Ventures, an education and training-focused investment firm, and Zoma Capital, a venture capital fund affiliated with the multi-billion-dollar family office of the Walton family (heirs to the Walmart fortune).

The company’s customers include Zayo Group, Well Wallet, Pivotal Software and Misty Robotics .

“In an industry that grapples with both pervasive skills gaps, and a troubling diversity challenge, Techtonic Group is pioneering a uniquely American solution: outsourced apprenticeships,” said Ryan Craig, managing partner of University Ventures, in a statement. “Techtonic Group’s outsourced apprenticeship model radically reduces hiring friction for employers and provides a pathway to great first digital jobs for Americans of all backgrounds.”

Techtonic isn’t the only company to attempt to bring the apprentice model to Middle America; there’s Kenzie Academy, launched by the Malaysian-born entrepreneur Chok Ooi and based off of a business he’d co-founded called Agility.io.

As we wrote back in November:

The principal idea behind Kenzie  — which is named after Ooi’s youngest daughter — is to address the gap between higher education and the world of employment. That’s in the form of a work-focused school that transitions students into the world of work with the skills they need, while helping talent-hungry tech firms fill vacant roles in a more efficient way.

As for Zoma Capital, much of its focus is on trying to alleviate some of the pressures wrought by the mass industrialization, globalization and evisceration of local economies that helped create the billions of dollars its investors are spending.

“We’re passionate about identifying and supporting promising solutions that tackle pressing social challenges,” said Ben Walton, co-founder of Zoma Capital. “Techtonic Group’s approach recognizes the power of on-the-job training and relationship-building to not only equip individuals with in-demand skills, but also help them identify fulfilling career pathways for the long-term.”