Why I got my first investor after 5+ years of successful bootstrapping…
By Shaily Baranwal (email@example.com)
As the founder-CEO of an education technology growth company, already multi-million dollars in sales, and about to launch its second product, my focus lately has been on…you guessed it…fundraising.
I can comfortably say that in the last five+ years, we bootstrapped the company to success. It started as an internship graduate school project through alternative sources of funds support. I started with an initial grant from the Zell Lurie Entrepreneurial Institute at the University of Michigan as well as winning various business plan competitions. After that, we self-sustained to-date. In the same amount of time, the company has reached 30,000 American students and used disruptive technology to provide intervention at schools for at-risk students, elevating their assessment scores and overall learning.
My company, Elevate Learning (as Elevate K-12), has delivered one million hours of educational instruction, thanks to our network of 600 teachers across the country, and has grown to many millions of dollars in sales since 2010. We planned our sales and expenses meticulously in order to have funds to successfully re-invest in the business each year, and it worked! Our sales and expenses both grew at a remarkable, sustainable rate.
New concept, disruption, discipline
We made location irrelevant to education by providing structured virtual classes to excel students in K-12 beyond what is offered in the American education school system. And I attribute that in part to discipline. Not only discipline on the behalf of my team to make every hour and dollar count, but also as the role discipline plays in the service we offer, which has made all of the difference.
Plan to raise only when the product-market fit is ready
Since its start, the business has grown by 100% each year staying cash flow positive the entire time. We took some time to really understand what the market needs were. We took a year or two to perfect Elevate K-12. We always listened to customer feedback and worked hard on giving the “best” service possible. We hit a point where in order to reach more kids and expand both Elevate K-12 and our second new service Classblox, now in beta, into a diversified education platform, it was time to find the right investor.
Finding the right strategic investor
I was very clear since day one that our investor must understand and believe in the company cause and desire to impact K-12 education for all kids and also believe in our focus to build a sustainable company rather than a quick unicorn.
This spring we finished our first round of funding with Andy Bluhm (Delaware Street Capital) a well-known, savvy hedge fund billionaire with a passion for disruptive education technologies. I am extremely glad that a person as passionate as him is a part of the company. All of Andy’s investments in my company will go to scale Elevate K-12 and launch and grow Classblox. He also signed on to serve as a board observer and closely guides the vision for the two services.
Thanks to Andy’s investment and guidance, along with the hard work of my team, we are now massively scaling Elevate K-12 and conducting targeted pilots of Classblox around Chicago, IL and Ann Arbor, MI. The response from parents and kids using the classes while in beta has been phenomenal. We have seen a 3.6% conversion rate from visit to buy which breaks industry conversion metrics for revenue generating pilots.
Our goal is to give parents, students and schools access to these resources irrespective of whether they are in Montana or Rhode Island. With Elevate K-12 and Classblox, access to quality instructors and classes will not be restricted to where the student lives.