As the job market remains tight (massive layoffs and tech hiring freezes aside), companies are focusing on retaining staff. One of the areas they invest in is upskilling, which aims to teach employees new skills in departments they are unfamiliar with. For example, Walmart announced in 2021 that it would invest nearly $1 billion over the next five years to provide its employees with access to higher education and training.
Unsurprisingly, “skills” platforms have benefited enormously from these investments. According to Crunchbase, upskilling and reskilling startups raised $2.1 billion from VCs between early 2021 and 2022. One of the winners is GrowthSpace, founded by Omer Glass, which leverages algorithms to match individual employees and from groups of employees to experts for development sprints. The company announced today that it has raised $25 million in Series B funding led by Zeev Ventures, with participation from M12 (Microsoft’s venture capital fund) and Vertex Ventures, bringing the total raised from GrowthSpace at $44 million.
GrowthSpace was founded in 2018 by Dan Terner, Izhak Kedar and Glass. A former management consultant, Glass was approached several years ago by Terner, who was then COO of Signals Analytics, a company facing a significant churn problem.
“Terner realized that there was no effective, results-driven employee development platform to enable companies [including his] to better invest in their employees,” Glass said. “This led to the creation of GrowthSpace…During the pandemic and in the current economic uncertainty, companies realized they needed to redouble their efforts to develop their talent.”
GrowthSpace combines a software-as-a-service platform with a marketplace of experts – providers of mentoring, coaching, training and workshops. Based on a taxonomy of career paths and skills, which includes tags in areas of expertise, industries and roles, the platform’s AI model tries to predict the right programs and coach-student matches. with the greatest likelihood of achieving the desired development results.
Of course, the AI doesn’t always get it right. Biased datasets can lead to unreliable predictions and, possibly, coach-student matches. Upskilling already suffers from a human bias problem, with PwC research showing that companies focus too much on upskilling postgraduate degree holders to the detriment of almost everyone else. Workers are often passed over for training because of their ethnicity and gender, PwC also found, with women twice as likely to report gender discrimination as men.
When asked, Glass did not provide a detailed account of GrowthSpace’s debiasing efforts. But he said the AI system tries to mitigate bias by presenting a “mirror data image” of each user that excludes personal characteristics such as race, gender and age.
“GrowthSpace has developed a unique algorithm that removes 90% of users’ personal data from its platform within three weeks of user onboarding, once the data is no longer in frequent use,” Glass said. “[This enables] in order to minimize its exposure to users’ personal data.
The GrowthSpace platform can be implemented in a modular way to meet the needs of large enterprises or configured as a complete solution, Glass explains, allowing leaders to allocate resources between different types of programs. All startup departments are mapped to corporate KPIs to provide management with reports to measure the impact of development programs on business performance.
“The industry must evolve significantly to meet business growth and professional development demands over the next decade,” Glass said. “The Great Recession has heightened the importance of measuring growth more accurately, providing employees with more scalable and consistent ways to upskill and retrain at a much faster pace. Learning and development must also be more agile and responsible.”
GrowthSpace competes with platforms like GOMYCODE, Worker.ai and Scaler, the last of which surpassed a $700 million valuation in January. But Glass says GrowthSpace has grown substantially over the past year, now reaching 3,000 active users out of 200 paying customers, including a US government agency, Microsoft, Siemens, EY and Johnson & Johnson.
In fact, Glass says he wasn’t actively looking to raise capital.
“Once investors became aware of the recent growth…they approached [me] invest,” he said. “GrowthSpace will use these funds to expand globally to meet rapidly growing demand and continue to expand its competitive advantage through technology innovation.”
The startup – which has $44 million in the bank – also plans to expand its 70-person New York-based team, aiming to reach 100 employees by the end of the year.