New Markets Venture Partners Raises Over $160 Million for Oversubscribed Economic Mobility Fund
- Cat Burchmore
- Feb 27, 2023
- 4 min read
Updated: Nov 13, 2024
The nation’s longest-running edtech and workforce technology VC has generated outsized returns and measurable social impact by investing in evidence-based solutions
New Markets Venture Partners, the nation’s premier edtech and workforce technology venture capital firm today announced that it successfully raised more than $160M for its new fund, New Markets Education Partners III, LP. Founded in 2002, this is the MD-based firm’s fifth fund and is specifically designed to advance New Markets’ strategy of investing in early- and growth-stage companies with demonstrated efficacy in improving student and workforce outcomes.
Over the last two decades, New Markets has made equity investments in 41 companies, with a particular focus on edtech and workforce technology companies, measurably improving economic mobility for more than 47 million Americans while generating $3.3 billion in value for shareholders. With 26 realizations since 2012, New Markets has one of the strongest proven records of successful exits, cash distributions back to limited partners, and positive social returns of any impact investor in the country.
The firm’s disciplined investing strategy has consistently generated outsized returns for limited partners with a very low loss rate, while focusing on evidence-based solutions that generate authentic, measurable impact. This track record is the result of New Markets’ expertise in finding double-bottom-line companies led by visionary founders with research-based, efficacious interventions that drive systemic change and strong risk-adjusted returns in lockstep. The New Markets team has a long history as a double-bottom-line investor and has been driving sustainable social impact since pioneering work in the Socially Responsible Investor (SRI) movement of the early 1990s.
“We are fortunate to have this unique opportunity to provide capital and support to the most deserving mission-driven education and workforce entrepreneurs,” said Mark Grovic, Co-Founder and General Partner of New Markets Venture Partners, who has dedicated his life and career to market-rate impact investing since the early 1990s when he served as Portfolio Manager at the Calvert Group, a pioneer in impact investing. “Over the last three decades, we have accumulated the assets and experience to understand the challenges faced by the nation’s top education and workforce entrepreneurs and to help them overcome these challenges.”
Over the last three years, New Markets has invested in seven new companies and realized 10 investments including Credly, Presence, LearnPlatform, Signal Vine, Kickboard, Mursion, StraighterLine, Whiteboard Advisors, Galvanize, and Graduation Alliance, which totaled more than $1 billion in market value and returned over $100 million to limited partners.
As explained by Gregg Rosann, President, CTO, and Co-Founder of Graduation Alliance, the market-leading high school dropout recovery platform, which was acquired by KKR Global Impact, “Find an investor that understands you, your potential, your roadblocks and ways to overcome them. New Markets understood us – they were the right partner at the right time.”
The continued growth of New Markets and its portfolio comes at a time when global edtech investing is down by nearly 50%, according to HolonIQ. The new fund underscores and strengthens New Markets’ proven ability to successfully navigate three previous recessions and commitment to invest in innovative, scalable companies with evidence-based solutions that focus on increasing the proportion of underserved Americans who achieve critical, research-based, developmental milestones in education, career, and life.
The Fund will target Series A and B investments and opportunistic recapitalizations focusing on companies generating $2M to $50M of revenue with a high potential to grow to $50M to $200M in revenue and reach profitability within three years of the initial investment.
Former entrepreneur Jason Palmer, General Partner of New Markets and previously Deputy Director of Education at the Bill & Melinda Gates Foundation, comments, “We are honored to work with the nation’s most innovative founders, scaling new technologies that can truly transform education and work. These entrepreneurs are literally re-inventing education-to-workforce connections, building more equitable pathways to the middle class for millions of Americans from underserved backgrounds – and doing so in a way that proves capitalism can do good.”
In raising this fund, New Markets received significant support from its existing investor base and also welcomed several new U.S. and European education-focused foundations and endowments. Equally importantly, New Markets received commitments from multiple publicly traded strategic investors validating the firm’s evidence-based investment strategy to drive collective impact, unique deal flow, and thought leadership. These new limited partners include academic publishers, global skills development leaders, human resources experts, and large-impact investment funds, among others.
Robb Doub, Co-Founder and General Partner of New Markets Venture Partners adds, “We are honored to be trusted by a group of limited partners with deep knowledge of the education and workforce industry. We look forward to continuing to work with exceptional management teams and fellow impact investors to build successful companies.”
New Markets’ hands-on approach and deep expertise along the education and workforce continuum help visionary entrepreneurs and their teams form partnerships with school districts, universities, states, and employers. These types of mission-critical relationships measurably improve the lives of students and workers throughout the United States, especially those from underserved backgrounds.
“New Markets played an instrumental role in supporting Presence from its infancy to our current leadership position in the special education teletherapy market,” said Kate Eberle Walker, CEO of Presence. “Their team brought a consistent and intentional focus to company building and evidence-based solution development focused on student outcomes. This expertise enabled our company to achieve rapid growth while remaining true to our mission to empower all who serve students with diverse needs. New Markets was a critical partner in our success over more than eight years, a thoughtful advisor through thick times and thin, and continues to support us as an important connector to emerging innovative partners in our sector. New Markets’ commitment to double bottom-line investing and efficacy-based solutions is unparalleled.”
About New Markets Venture Partners
New Markets Venture Partners is one of the nation’s leading impact venture capital firms that invests in and actively assists early- and growth-stage education and workforce technology companies. The New Markets team has three decades of experience supporting evidence-based, high-growth companies that improve economic and social mobility by leveraging deep relationships with centers of education and workforce innovation. New Markets prides itself on adding value to its portfolio companies before, during, and after the investment process, with the ultimate goal of improving both individual outcomes and America’s education and workforce system. To learn more, please visit www.newmarketsvp.com
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