Stride Funding, a fintech startup based in Boston, has raised $12 million in seed funding to help students supplement their student loans with Income Share Agreements.
The funding round was led by Firework Ventures with participation from Juvo Ventures, Graham Holdings, GSV Ventures, Slow Ventures, and Sinai Ventures. Several angel investors, which include industry and academic leaders, and serial entrepreneurs, also participated in the round. Brigette Lau, Founding Partner at Firework Ventures, referred to the firm’s participation in the round by stating:
“We are pleased to back an extraordinary entrepreneur generating impact by realigning EdTech and FinTech.We view Study Now, Pay Later products as the future of educational funding, as they provide much-needed downside protection to students, while aligning the incentives of schools and investors with student outcomes. Stride is purposefully shaping this space and we’re thrilled to join them in this journey!”
Stride Funding was founded back in 2018 by Tess Michaels, a Harvard Business School student at the time, with the mission to help students pay for school more easily and affordably, improving their economic prospects once they graduate. The startup achieves this by making use of Income Sharing Agreements, income-linked loans, and Deferred Tuition Agreements (DTAs), which bring more flexibility than traditional loans. Michaels said about this mission:
“Stride is powered by the fundamental belief that equitable education financing should be based on students’ potential and opportunity, not their past. We help young adults underserved by the traditional credit markets gain access to educational programs that improve their economic and career outcomes. Closing our Series A is a significant milestone, but we are just getting started on our quest to make the $130 billion private student loan market more equitable, flexible, and above all – a runway for economic mobility.”
According to the Education Data Initiative, 43.2 million American students have accumulated over $1.75 trillion, a value that is growing 6 times faster than the country’s economy. Of all debtors, over 35 million have found themselves in the need to apply for debt relief as they were unable to handle the payments. Stride Funding believes that by offering alternatives to traditional student loans, it can help prevent the collapse of the financial systems while helping students fulfill their higher education dreams without being tied to debt for life.
