Study Abroad EdTech Company ApplyBoard Raises $55 Million Series C Extension At $1.4 Billion Valuation

^Iranian brothers Massi, Meti and Martin Basiri had such difficulty applying to study in Canada, they quit their jobs in 2015 to build the Common Application equivalent for international students. Now their Waterloo, Ontario-based company ApplyBoard is the world’s largest digital hub for international student recruitment—having helped 120,000 students identify and apply for 1,200-plus schools abroad. Today they announced $55 million in Series C extension funding from Educational Testing Service, Index Ventures, Blue Cloud Ventures and Harmonic Growth Partners at a $1.4 billion valuation.

“Our company happened accidentally,” 32-year-old cofounder and CEO Martin Basiri told Forbes. “Meti, Masi [Basiri] and I came to Canada 10 years ago and in the process we figured out how hard the process is. From day one, we knew this is such a big problem that if our idea works it would be an extremely big company.”

Currently, ApplyBoard has over 500 employees in 20 different countries ranging from Nepal to Mexico, (150 of whom were hired during the pandemic to mostly work from the company’s Waterloo headquarters as this is where 70% of employees are based). Deloitte named it Canada’s fastest growing company in 2019 with 12,525% revenue growth from its 2015 inception to 2018. Last year Martin’s 27-year-old twin brother-cofounders Meti and Massi landed on the Forbes 30 Under 30 Education list. So what made them decide to raise a Series C extension at the same valuation rather than a Series D?

“Our new investors approached us immediately after the Series C,” said Basiri. “As the time frame was very close and the amount was smaller than what we’d consider for our next raise level, we decided to do it as a Series C extension, rather than a Series D. If we do a Series D, it would be for a substantially larger amount.”

On ApplyBoard.com students from 100-plus countries fill in their academic interests, credentials and financials and ApplyBoard’s AI matches them to corresponding undergraduate and graduate institutes. Much like the Common App, students then submit a universal application—essays, test scores and demographic information—to institutions that pique their interest on ApplyBoard. After being accepted, students can utilize ApplyBoard’s team of experts for guidance through the visa application process. Applyboard provides all of this to students at no cost. Once the student is enrolled and visa-approved, ApplyBoard makes money by taking a cut of the student’s university tuition. Though the company will not disclose their revenue, they say they made $300 million in 2019 selling universities on ApplyBoard.

Though U.S. students can’t currently travel abroad, Applyboard has experienced a 300% uptick in schools signing up for its service during the pandemic as universities seek substitutes for face-to-face interactions with prospective students. ApplyBoard works with major institutions like University of Delaware, Arizona State University and Johns Hopkins in the U.S. (though international students cannot currently apply for these schools) and others like McGill University in Canada and the University of Manchester in the U.K.

“It really doesn’t matter when the pandemic finishes because we are on the road to educate the world,” says Basiri, taking a rosy outlook on the current travel restrictions.

Overall, the company has raised $130 million from venture firms and angel investors. The Series C extension they announced today marks the fifth time the Educational Testing Service (ETS), the world’s largest test administration nonprofit behind assessments like the TOEFL and GRE, has invested in a company.

“The company is growing significantly and in areas that are highly relevant to ETS—some of our assessment products are really complementary,” Ralph Taylor-Smith, managing director of ETS Strategic Capital, told Forbes.

With class-from-home, venture firms are pouring funds into edtech companies. By August 31, edtech companies had already received $4.8 billion—more than they received in the entirety of 2019, according to CB Insights. Non-U.S. companies have received increased interest from investors during the pandemic as some of the highest funded edtech companies of 2020 are foreign and teach English—like China’s Zuoyebang, which raised $750 million in June and India’s BYJU’s, which closed a $500 million round in August—showing the pandemic-proof attraction for investors in platforms to facilitate English learning. Further, the number of international students has tripled over the last decade to 6 million—who account for over $200 billion in tuition spend. For San Francisco and London-based Index Ventures that, alongside the belief that U.S. universities have excess capacity for international students with a growing global middle class, marked an opportunity for investment in ApplyBoard unhindered by the pandemic.

“We are incredibly bullish on the demand for an international education despite the short-term disruption of Covid,” Dino Becirovic, a principal at Index Ventures, told Forbes. “Whether students enroll in schools physically or virtually, it’s clear that the demand for studying abroad has not diminished as the company has seen minimal deferrals to date. Despite the impressive growth, they are just getting started. The market is enormous and growing rapidly.”