As Packback continues its pivot away from an online textbook platform and into artificial intelligence software for college courses, Mark Cuban and other investors are pouring more money into the Chicago startup.
Packback announced Wednesday that it has raised a $4.2 million Series A round of funding led by University Ventures. Cuban, the Dallas Maverick’s owner and “Shark Tank” investor, along with Wintrust Ventures and Wildcat Capital, also invested in the round. The round includes the $1.5 million investment Packback announced last September from University Ventures.
The new funding comes as the startup’s AI-powered online discussion platform is quickly catching on with schools across the country. Packback’s technology helps professors measure a student’s response to written questions and essays, allowing professors in large lecture classes to quantify difficult-to-measure behaviors like a student’s critical thinkings skills.
Packback says its discussion platform is used by professors in more than 100 universities—including the University of Illinois, Ohio State and the University of Georgia. Packback’s co-founder Kasey Grandham said the startup expects 130,000 new students to use its platform this year.
The company saw revenue double during the second half of 2017 compared to the first half, Grandham said, and it expects 2018’s revenue to more than triple the year before.
Launched in 2014, Packback made waves when it appeared that year on Shark Tank and scored a $250,000 investment from Cuban. At the time the startup was offering 24-hour e-textbook rentals for $5 a piece. Now, as the company has pivoted into a much different technology platform, Cuban remains a supporter of the business.
“He’s really fascinated in AI, especially as it relates to the future of work and automation in education,” Grandham said.
Grandham said Cuban has been a valuable resource for the young company, and he even emailed the team some words of encouragement as Packback was working through its pivot to AI.
“Success never comes on a straight line,” Cuban wrote. “I’ve been broke. Terrified. Excited. Rewarded. But every step of the way, I had to grind. Packback reminded me of that … every successful student, every happy school has been taking Packback closer to the rewards I know are in store.”
Packback has now raised $7.8 million to date, and has grown to around 35 employees.