Multiverse nabs $220M at a $1.7B valuation to expand its tech apprenticeship platform
We've been tracking a worrying trend of layoffs in the technology industry, but that is not the full story. There is, concurrently, a wave of organizations that are also in the process of training and hiring to fill a number of technology-related roles, specifically by way of apprenticeships. Today, a startup called Multiverse that has built a platform both to connect people with those opportunities, as well as to arguably spread the word around the concept of apprenticeships overall, is announcing a major round of funding to expand its own business.
The company -- founded in London and now co-headquartered also in New York -- has closed a Series D of $220 million, with its post-money valuation coming in at $1.7 billion.
For those keeping track, that is double Multiverse's valuation compared to its $130 million Series C, which closed just eight months ago. StepStone Group (not to be confused with recruiting platform StepStone) and previous backers Lightspeed Venture Partners and General Catalyst all co-led this round, with Founders Circle Capital and past backers Audacious Ventures, BOND, D1 Capital Partners, GV and Index Ventures all also participating.
Euan Blair, the CEO and co-founder (who is the son of ex-Prime Minister Tony Blair and high-profile barrister Cherie Booth Blair), said in an interview that the plan will be to use the funding both to continue expanding in the U.S. -- where it has operations in nine cities -- and its home market, as well as to continue investing in its technology.
Multiverse's basic approach is to pair human coaches -- employed by the startup itself -- with apprentices and then embed them together with organizations that are taking on the apprentices -- a list that now numbers 500 big names, including government organizations, Cisco, Verizon, Box, financial services companies and many others. Jobs that are covered in the Multiverse universe range from software engineers through to data analysts, professional services and related roles. Blair told us that the Multiverse community -- which includes apprentices as well as coaches -- now numbers 8,000.
The company's business model follows from this:
Mutliverse charges employers a small recruitment fee for sourcing apprentices for them, and then charges them for the cost of training, which accounts for the majority of its revenue, Blair said. Employers then pay the apprentices a salary. "A cardinal rule for us is that it must be free to the apprentice, and they must be paid a salary," he added. "We provide employers with a platform that gives them access to non-graduate talent from diverse backgrounds and the ability to reskill those who need it, brilliant coaches (employed by us) to deliver the training, supported by our tech, a formal credential for that individual in their chosen field of specialism and a vibrant community experience."
Multiverse is also leveraging developments in how governments are trying to help encourage more routes to the job market for more people.
In the U.K., employers largely pay for training via the Apprenticeship Levy, Blair said, referring to a government scheme that takes a small tax from companies which they can spend on apprenticeships. In the U.S., apprenticeships are tax deductible to employers and there are some small incentives on a state-by-state basis, he said. "Either way, there's no specific tax incentive in either market available to Multiverse directly."
That human element is not going to be automated in any way, Blair emphasized, but there are still a number of tech features that the company plans to introduce to enhance how the whole system works.
"It’s not an either-or with automation, but a coach for us is essential," Blair said, but said that technology can be applied to improve how to present materials and to help people learn in a way that supplements human coaching. "Automation also becomes increasingly important for spotting when they are struggling or falling behind in progress reviews," he added.
And as the platform grows, it's also expanding the kinds of roles it's building apprenticeships around, and each will come with its own set of coursework and more to build out, alongside the rest of the infrastructure for managing these engagements.
Some of the more advanced roles arguably cross into territory for what a person might have learned in a computer science course at university, which makes Multiverse disruptive both in terms of how it's tackling not just the job market and the tech talent race; but also that of education and specifically higher learning. If you were open to the idea of working in a tech-related field and might have considered a major or courses in a related area, why not consider an apprenticeship, where you get a decent $65,000 starting salary (this is the figure Blair quoted to me) and bypass huge student debts?
It's an approach that seems to be getting some traction. Despite the many challenges presented by COVID -- specifically, the shift so many organizations with knowledge workers made to remote environments; and a number of organizations freezing hiring initially -- Multiverse's customer base grew ninefold over the last two years. Multiverse notes that specific job roles like like Software Engineering have seen a 260% growth in enrollment year over year with a completion rate of over 85%.
Blair credits this in part to the pandemic: The so-called digital transformation that many organizations went through in getting their teams to a point of being able to work remotely also spurred many of them to rethink people management, and teams overall, and how to invest in them. Among individuals, meanwhile, younger people who might have been on the fence about university have been shown to be choosing not to enroll, with numbers there in decline.
"College is failing the needs of a lot of people, so how can we support them? Through apprenticeships," Blaire posited.
Indeed, the existence of tech and professional services apprenticeships, which still allow for getting paid and getting professional training on the job, is the kind of model that gives many of those people options.
This is particularly needed in countries like the U.S., where two-thirds of adults do not have a college degree but are trying to make way in job markets where 65% of jobs require a degree or higher-learning qualifications. Blair told me that typically the retention rate for apprenticeships run by Multiverse is 85% -- in other words a drop-off rate of 15% -- compared to what he said was a completion rate of just 9% for professional training courses typically run as MOOCs. He added that 90% of those who complete also stay in the jobs at the companies where they carried out their apprenticeships.
“Apprenticeships can help thousands of companies better train workers for the jobs needed to thrive in the age of digital transformation,“ said Hunter Somerville, partner at StepStone Group, in a statement. “Multiverse has a demonstrated track record of success, building an unparalleled global platform to find, train and develop talent.”