US based online university platform University of Nexford has raised $8 million in a Series A round co-led by New Markets Venture Partners and Learn Capital, two prominent US edtech venture capital firms that have invested in Pathstream, Udemy and Coursera. Jason Palmer, general partner of New Markets Venture Partners and Greg Mauro, managing partner of Learn Capital, join Nexford’s board of directors.
The tech-enabled startup, launched by Fadl Al Tarzi in 2019, fills the affordability and relevance of education. Since the traditional college experience has not changed in many years, edtechs like Nexford are pioneering a paradigm shift in higher education that puts students first and equips them with the skills to succeed in the present and the future.
Nexford University offers students a fully online education and allows them to study at their own pace. Once students apply and are accepted into a degree or course program, they choose how fast or slow they want the program to be. Nexford’s main markets are traditionally disadvantaged Anglophone communities such as Nigeria. The West African country is the only market where the US-based edtech has learning communities that help students get around infrastructure problems such as the Internet and transportation. The company plans to launch such centers in markets such as Kenya and the Philippines.
Nexford University offers the same programs as last year. Bachelor’s degrees include courses in business administration, AI and automation, business analytics, and product management; business administration, advanced AI, e-commerce, hyperconnectivity, sustainability and international business courses are graduate degree programs. In a recent interview with ukbusinessupdates.com, CEO Al Tarzi said his company plans to add more programs in the next six to 12 months, such as software engineering, data science, clean energy, business analytics, digital marketing and project management based on the question from students.
The chief executive also said Nexford plans to launch several pathway programs — six-month programs designed to give students the skills they need to land specific jobs in five vertical areas, including the new courses mentioned above — as supplement to the training.
“The Pathway programs are also being incorporated into our training,” he said. “So what that means is if you complete the pathway program, if you want to go ahead and get a master’s or bachelor’s degree, you can do that,” he said. “But if you have a job and want to come back a few months later, you could. So the path gives you the skills you need and a certain percentage for a formal college degree.
This stackability factor is one of several ways Nexford differs from traditional institutions, Al Tarzi said. He also praises the platform’s day-to-day academic support and affordability, adding that conventional universities in the US can charge as much as three or four times Nexford’s price for Pathway programs. For example, Nexford’s accredited degrees cost between $3,000 and $4,000 (which are paid in monthly installments), but the average annual tuition for a master’s degree in the US is about $36,000.
Regardless of costs and unique selling propositions, edtech platforms must prioritize results. And in the three years that Nexford has been in existence, the measurement results have changed. Many traditional and new edtech starters measure learning outcomes through placements. For Nexford, it’s just one of three, which includes getting a promotion and higher salary and taking practical courses to grow a business as an entrepreneur.
“I think one of the most fundamental developments we’ve had is that we now have a lot more data on learners and outcomes that gives us more confidence that our alumni will succeed after graduation,” said the CEO. “In our last study, we saw that about 92% achieve that.”
Internally, the edtech platform also wants to improve business operations by becoming profitable. Al Tarzi said Nexford has positive margins due to sales of 2x in 2021 compared to the previous year, and that the number of registrations has increased from 70 countries to 90+ this year.
Last June, the three-year-old startup announced a $10.8 million pre-Series A round. It seems to be a downward round; Al Tarzi disagrees, however, saying the company’s valuation in Series A is relatively higher than the latest raise, calling the drop in funding to a “significantly oversubscribed and expanded” pre-Series A.
Investors participating in the Series A round include the Learn’s Emerging Markets Fund, anchored by International Finance Corporation (IFC), Bisk Ventures, Global Ventures, Future Africa, UK-based investment firm AMK Investments and the Future of Learning Fund.
Nexford said in a statement that the proceeds will take the company into new markets, broaden the company’s academic offerings, including career path programs, and improve its technology infrastructure. “We will continue to invest in product and geographic expansion and technology. The latter allows us to work as efficiently as we do, so we don’t have to increase our tuition fees,” said the CEO. “Last year, we reduced customer retention costs by nearly 50%, thanks directly to the operational efficiencies enabled by technology. So we will continue to invest in technology to increase efficiency and preserve student tuition now.”