Andela Raises $100 Million to Extend Its Training Mission
January 28, 2019
From all accounts, 2018 was a bumper year for edtech companies on the funding front. Among the many huge wins was an announcement by Byju’s in late 2018 that it had raised $540 million in private equity funding. One month into 2019, there are already strong indications that venture capitalists will continue to invest in edtech over the coming year and may be especially interested in companies with a global reach. On January 23, Andela–a New York-based edtech company that brings tech training to students in Africa–announced raising $100,000 million in a recent funding round.
Andela, which launched in 2014, aims to train African software developers and place them in jobs around the world. As reported on TechCrunch in 2017, Andela is highly selective about which applicants they accept to their program. To date, they’ve trained about 500 people from an applicant pool close to 70,000. Once accepted, the company not only provides high-quality training from one of its bases in Nigeria, Kenya, Uganda, or Rwanda but also takes care of its trainees along the way. Perks include a stipend, laptop, housing at a discounted price, two daily meals, and after six months, a job placement with a decent salary (adjusted to the cost of living in different cities).
Since Andela’s trainees don’t pay any tuition, they are required to sign a four-year commitment to Andela, which includes a two-year requirement to work at the company. But so far, most of Andela’s trainees stay well beyond the two-year requirement. According to a recent article in TechCrunch, 98% of the company’s developers choose to keep working for Andela beyond the commitment period.
Another Successful Funding Round
On January 23, Andela announced that it had secured $100 million. But this isn’t the first time Andela has attracted high-profile investors. Existing Andela investors include the Chan Zuckerberg Initiative. Thanks to its ability to attract investors, the five-year-old company is now estimated to be worth between $600 million and $700 million. But this raises an obvious question: What does Andela plan to do with its latest influx of cash?
According to TechCrunch, Andela will use its new funding to double in size over the coming twelve months. The company plans to hire an additional 1000 developers. It is not clear whether this will entail setting up new training hubs outside the four African nations where the company is already operating.
On Andela’s blog, CEO and Co-founder Jeremy Johnson was a bit more cryptic about what the $100 million might mean for his company. In a post announcing the successful funding round, Johnson opened with an epigraph from sci-fi writer William Gibson that reads, “The future is here, it’s just not very evenly distributed” In his post, Johnson went on to explain that Andela was launched to bring highly-qualified developers to companies who desperately need them.
As Johnson writes in the conclusion to his January 23 post, “The future is here — and it’s not fully distributed — but it will be.” Whatever comes next for Andela, two things appear clear: Its CEO is confident that it is well positioned to drive the future of distributed training and work and several key investors appear to agree.