When Sebastian Fung enrolled in the Startup Institute, he had dreams of starting his own company. He left his comfortable finance job at PricewaterhouseCoopers, and moved from Toronto, Canada, to Boston in hopes of finding a co-founder — a task hard to accomplish with little to no network.
“I was originally intending to just grow my network to join a company,” Fung said in an email to BostInno. “But, I found two amazing co-founders and figured there was no time like the present.”
Had it not been for the Startup Institute, Fung might have never launched his own company. And simultaneously, various lifelong learning programs and developer bootcamps were changing the lives of others, as well.
The only problem was that those programs can be expensive. The Startup Institute’s full-time, eight-week program costs $4,750. “The original coding bootcamp,” Dev Bootcamp, rings in at a whopping $12,200.
With those kinds of hefty dollar signs in mind, Fung set out to launch LendLayer, a social lending platform meant to empower future technical talent by helping them pay for their education. The launch came with its own hefty dollar sign, however: $400,000.
On Tuesday, the LendLayer team announced the financing round, led by Skype Co-founder Jaan Tallinn and Bluefin Labs Co-founders Michael Fleischman and Deb Roy. With the funding, LendLayer will be able to start pilot programs with Hackbright Academy, MakerSquare, Insight Data Science and Hack Reactor, which each help aspiring software developers propel into new careers.
Rather than focus on credit score, the startup zeroes in on students’ future earning potential; interest rates are driven by the bootcamp being attended, a student’s GitHub commits and his or her work experience listed on LinkedIn, among other potential factors. The lender will then promise investors a return of eight to 10 percent, while students will face an interesting ranging from 15 to 20 percent.
As fellow Co-founder Steve McGarry told VentureBeat, some interest rates may be lower, and most students won’t be required to make repayments until after they graduate. If students can’t find a job after graduation, LendLayer will then help them find employment, as well as restructure their loan.
Fung and McGarry met at the Startup Institute, which they both attended in the spring of 2013. The duo tried launching a separate company, called itsDapper, which they brought through Providence-based accelerator Betaspring. While there, they met Matt Gibb and James Lovatt, the former of which had attended Insight Data Science, while the latter was a developer enamored by these kinds of bootcamps.
Each had seen firsthand the financial burden that came by balancing living expenses with no income during a full-time developer program. They then headed West individually, yet reconnected, and decided to launch LendLayer in June 2014.
“The ultimate goal for LendLayer is to help people improve their lives,” Fung said. “It sounds cliché, but the reason we chose this space is because we know the power that a bootcamp has to change someone’s career trajectory.”
Beyond that, programs’ payoffs were proving to be more and more worth it. Take the guy who spent $11,000 on a coding bootcamp and then doubled his salary.
“We chose to avoid consumer debt … because we’re trying to get people out of debt in the long-term,” Fung added.
And, given the early interest, it’s clear their method is working. So, keep your eyes peeled. By early 2015, the team also plans to be operating in Massachusetts, Illinois, Texas and New York.
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