It’s an exciting day for us at GrowthSpace. We’re thrilled to announce our $15 million Series A funding round. These funds will help us expand our technology to connect employees with relevant experts at scale, while measuring and fulfilling business KPIs.
But first, let me share a little bit about how we got here. Our vision began a few years back when co-founder Dan Terner and I realized the need for a human-led employee development platform that would solve the L&D industry’s main problem.
The L&D Industry Doesn’t Work
I’ll never forget the day that Dan called and asked me, “How do you create effective employee development?” At the time, he was working at a growing analytics startup of 150 employees, and, despite significant funds invested in L&D, they were experiencing high employee turnover. My answer to his question was, “Nobody knows”.
The one thing that everyone did know was that the L&D industry wasn’t achieving the goal of properly training employees, a problem made worse by the absence of real data, best practices, and a method to scale.
To this end, multiple studies published by Harvard Business Review showed that billions are spent on training, but only 25% of respondents said that training measurably improved performance, and only 12% said that they actually acquired skills that they could implement in day to day work.
Planting the Seeds of GrowthSpace
Dan, Izhak, and I came to understand that this is a problem of scale and data. You can easily develop individuals (usually the top people in a company), but there was no way to expand existing methods to handle thousands of employees at all levels of a company. Moreover, there are a multitude of areas for employee development, for both soft and hard skills, and it’s very difficult to find just the right expert.
In order to scale, you need a lot of experts; a lot of data; an understanding of what works and what doesn’t; and a sophisticated tool that can match the right people and measure results.
Plus, how do you measure the success of a training program? Maybe the trainer gets 5 stars because they are nice, but the employee still does not necessarily improve in their area of training.
Coaching Isn’t Going to Be Enough
At first, as a big fan of coaching, who was coached by one of the world's best, and as the founder of a career school for employees, I thought the solution lay in the right type of coaching firm. But, with the help of early customer feedback, we learned that the solution needs to be so much more than just coaching.
One of our first clients, Taboola, taught us a lot about what it would take to realize our vision. We shaped the platform accordingly:
They did not want coaches exclusively; their employees had various types of challenges, so they also wanted mentors, trainers, and other experts. I understood that this requires extensive data as a way to match specific training needs to experts in very granular areas.
They wanted to make the L&D platform their own, i.e. their own branding, style of communication, processes, terminology, and measurement parameters. We designed the platform accordingly to be easily customizable.
They wanted reliable data to show management the effectiveness of training programs, and how a trainee’s direct manager views their progress. I therefore made the decision to use feedback from direct managers as a way to measure success in reaching KPIs.
Fine-Tuning the Fix
These valuable insights from our first customers showed that to make this platform truly successful, we need to listen actively and continuously to our customers’ needs. We also realized that the only way to move the needle and help employees be the greatest they can be is to automate this once-tedious L&D process.
All in all, after the initial foray of GrowthSpace into the market, our dream is now to enable companies to empower and develop their employees in a way they never could before; and the right data and technology would be the tools to help them do inspiring things.
Getting to Series A
Due to our fast traction, and cash positive business model, we didn't need to fundraise in 2021. However, we were presented with an opportunity to obtain a Series A round from great partners like M12 - Microsoft’s enterprise software venture fund - and Vertex Ventures, so we decided to go for it and drive our growth even further.
We are applying the funding to build our company across multiple areas of operations (sales, R&D, customer success, etc.) in the effort to try to solve this huge industry challenge. For example, we use NLP (Natural Language Processing) to search plain text for detailed development requirements, and this enables us to get very precise matching of experts. With this funding, we will continue to develop such technology.
Looking to 2022
There’s a lot of growth ahead! We want to evolve GrowthSpace into a comprehensive platform for all human-led L&D, using the same concepts we have already built: A platform that is personalized, data-driven and connected to business KPIs. We’ll expand one-on-one growth programs to many more topics - to cover every competency for every employee. We will also be applying our technology to support our customers' internal mentoring programs, as well as enabling group training, workshops & lectures.
The key to this is an enterprise-scale system that answers precise training needs, delivers a personalized solution for companies, and facilitates a data-based method for measuring training success. And, throughout all development processes, we will continue to actively listen and learn from everyone’s professional challenges.
At least for the time being, we seem to be on the right track. Of all of our customers so far, 96% of employees and 80% of direct managers have reported improvement in business KPIs; and we plan to continue measuring and optimizing this success.
We believe there is greatness in every employee, and are excited to have the opportunity to bring it out.
To find out how GrowthSpace can help you take your employee development efforts to the next level, click here to book a demo.