Mariano Kostelec, CEO and co-founder, together with Marta Palmeiro, of StudentFinance, had it clear since childhood: "I imagined solutions for needs that I observed around me". Thus was born the idea of providing funding for students or young professionals who wanted to study outside their country and needed to overcome the cost barrier. "That's when I knew there was an opportunity."
His business idea fits like a glove to the business situation that Spain is experiencing, immersed in a deep drought of digital talent. A hole that does not stop growing motivated because technology progresses at a dizzying pace while the training of its workforce does not run even. In fact, there are 120,000 technological vacancies that remain to be filled, according to the Association of DigitalES Technology Companies. For the entrepreneur, the deficit of these necessary positions in the market has part of its origin "in the difficulty to access to finance this training".
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With this premise he launched the proposal of "study now and pay later". It moves away, thus, from the traditional student loans that, in addition, usually require income from the applicant. "It is not necessary to have payroll or income because our return is aimed at the future potential of the user." Something that makes possible the imported North American formula that is based on income sharing agreements or ISA financing (Income Shared Agreement) by which the student returns this item when he obtains employment. This formula has allowed it to enter 15 million euros and plans to manage with the same 400 million in three years.
The system works as follows: it is available in Spain, the United Kingdom and Portugal to apply for funding in any of the educational centers affiliated to StudentFinance in these countries. They are both face-to-face and online or hybrid programs. The loans are repaid with between 6% and 12% of the payroll when the student is hired, provided that he exceeds the minimum income threshold (between 16,000 and 18,000 euros). The interest rate (APR) is around 10%.
The business rests on the voracious demand for technological profiles and training in digital skills. Subject that finances the platform (data science, cybersecurity or web page development ...) via formats such as bootcamp (intensive software development programs) or master's degree whose duration ranges from six to nine months. "It is a window of opportunity for people who would never have considered this training due to lack of resources, but also for those who choose to retrain with these new skills."
After two years of travel, they already have the support of Banco Sabadell Venture Capital or Jobandtalent and with 2,000 users who have completed about 250 programs. "We grow in supply by closing commercial agreements with training centers, which we include in our platform, and that offer this shared revenue model." These centers incorporate a monthly payment simulator to help the future student in their calculation. For example, for a Full Stack developer program and UX/UI expert, calculate a subscription of 160 euros for 36 months, from a minimum income threshold that, in this case, figures at 16,000 euros.
The business has also been joined by investors such as Iberis Capital and SmartLenders Asset Management, who lead the new round of financing with which the company has raised 39 million euros. With a turnover of three million euros and losses of four million, the start-up offers more services than simple financing. As an added value, it makes available to the user the existing information on the employability and salary level of a certain profile.
Access to employment
It tries to overcome the two obstacles, in addition to funding, that a student faces: "Identify where the opportunities are and their sectors and access employment". Something for which they have the collaboration not only of their associated companies, but with the internal support of an entire network of companies developed to expand the job possibilities of these candidates. If all else fails, the entrepreneur also offers alternatives through the platform: "If you can't find a job, payments are paused and we help you correct your employability." And in an extreme case, "the payment obligation expires after seven years," he concludes.
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