To get you up to speed for the week ahead, we serve you a Monday Ristretto here on EDUKWEST by picking the most important reads from the past week, putting them in a grinder and extracting the essential information for a short and punchy brew.
Today we’ve got three shots for you. It’s all about inBloom and the data backlash, investments in peer-to-peer lending platforms and edtech IPOs.
inBloom, New York and the Student Data Backlash
The story had been in the making for quite a while already with the outcome being somewhat predictable. After getting into hot water with a what one might call laissez-faire attitude towards critical student data, inBloom lost its contract with the New York State Education Department. Even worse, the Gates Foundation backed startup was ordered to remove all student data from the state out of its database and lawmaker passed legislation that will make it more difficult for edtech startups to offer similar services.
While parent advocates applaud this move and the senate in California is working on similar legislation, Chris Dawson makes the point that inBloom is not evil and we need to open up to the idea that data will become the backbone of education. He also engages in a deeper conversation with Katrina Stevens in the most recent episode of On the Ed.
SoFi raised a $80 million Series C
With student debt breaking the $1 trillion mark late last year, startups that offer alternatives to classic loans from banks or the government are picking up steam and investment. About two weeks ago we wrote about CommonBond which expanded its list of MBA programs to lend against to over 100 or SimpleTuition which raised a $26 million Series E for its platform that offers assistance to students seeking loans.
Social Finance, or SoFi, raised $80 million last week which brings the company’s total VC funding to over $160 million plus an additional $150 million in a securitized loan offering. Like CommonBond, SoFi is very selective about who can apply for a loan to keep the risk as low as possible, and like its West coast competitor the system is built upon a community of loan takers and givers who have the same background and aim to help each other in other ways, as well. SoFi now wants to expand into other verticals like mortgages and personal loans.
Another week, another edtech IPO
On Thursday Chinese professional education platform Tarena International made its stock market debut. Other than 2U which closed slightly up one week earlier, Tarena closed flat after a quick peak during the trading day.
Now all in all it has been a bad two weeks for the Nasdaq and on Thursday even 2U’s stock was down quite a bit. Overall, edtech investors and entrepreneurs are moderately confident after 2U’s IPO says the WSJ. Coming back to the peer-to-peer lending space, rumor has it that Lending Club is preparing its IPO in 2014 which could lead to a consolidation of the market with Lending Club acquiring one of its vertical competitors after or just before the IPO.
Picture by Jonno Sea via Flickr