Parchment – a leading education technology company streamlining the verified credential process – announced Wednesday that it has closed a $10 million follow-on investment led by the globally-recognized merchant bank, The Raine Group. This addition of capital brings the business’ grand total to $45 million raised.
Led by Blackboard co-founder Matthew Pittinsky, it isn’t surprising to see such a promising business concept grow with a prominent figure in higher education spearheading operations. Pittinsky has the experience, skills and demeanor required to transform an up-and-coming startup into a success story, and that became abundantly clear when we talked about Parchment’s investment announcement Monday.
Pittinsky shared more information about the funds that will go towards accelerating the company’s development and roll out of new product offerings, tools and resources for its ever growing network. He talked about empowering the tech-savvy generation to leverage their credentials to explore new opportunities with the investment made by The Raine Group and Parchment’s already existing institutional investors.
This capital backing comes after Parchment had a successful fourth quarter, facilitating the exchange of more than 1.8 million credentials in Q4 2013 and more than five million credentials over the following twelve months. That’s a 59 percent increase from last year.
An American University alum, Pittinsky and I immediately found common ground when conversing over the phone, but it wasn’t his admiration for his alma mater that sparked my attention. Rather, it was Pittinsky’s passionate description of his baby, Parchment, and honest assessment of his company’s progress since inception.
We took about a half an hour to chat about Parchment’s capital achievement, which turned into quite a telling interview about Parchment’s future. Check out the Q&A below:
InTheCapital: Tell me a little bit about Parchment.
Matthew Pittinsky: Parchment is bringing online a part of the everyday education world that isn’t online yet: the degrees, certifications, licenses, diplomas. We live in a little bit of a credentialed world, but to request that credential is very frustrating and not really easily available in digital form. That’s where we come in.
We’re a technology company and our platform allows schools, associations, universities and all the different kinds of organizations involved in producing or consuming diplomas and certifications to do so digitally. We enable the consumer to be able to request and collect and share and verify with our credentials online to make their lives easier and hopefully help them realize opportunities more effectively.
How did you come up with the idea for Parchment?
The idea for Parchment came to me while I was at Blackboard. Blackboard was a wonderful opportunity to see education come online. We were innovating the educational process, but not the credential – the currency people need to succeed.
It was then that I left Blackboard to work for Docufide in L.A. Docufide helped high schoolers send transcripts online to colleges. I saw an opportunity to build a bigger digital credentialing platformed, renamed the company Parchment and moved to Arizona. So while we say Parchment was founded in January 2011, corporate history dates back to 2004.
Do you find that you still run into issues with potential clients who don’t trust the online credentialing process?
It took about seven years to transact the first million transcripts. Now, we’ve done about five million in just 12 months. There are still employers and associations that don’t realize they can go digital and save time and money, but that’s changing pretty rapidly.
What local schools does Parchment currently have partnerships with?
American University, Wesley Theological Seminary and the State Office of the State Superintendent – D.C. Office.
What are your plans for the new investment announced Wednesday?
We’re a little bit like GrubHub or OpenTable. We have an organization side of what we do and then the consumer side – the data driven tools that help students see what they can do with their credentials.
Most of our capital has been focused on the organizational side and getting that right. For this round of capital, we plan to focus on the consumer side. We’ve seen significant growth on consumer growth and engagement on the platform – about 90 percent growth in 12 months.
We want to invest to accelerate our expansion of credentials we work with on Parchment. Not just academic credentials, we want to get into those professional and lifestyle credentials, too. We also have plans to expand data driven tools we provide for users like the high school admission tool.
Image via Parchment