Goldman Sachs and Sesame Workshop pour money into this edtech firm’s newest fund – By Natasha Mascarenhas (Techcrunch) / Feb 11 2021
Reach Capital III is a $165 million investment vehicle
Shauntel Garvey and Jennifer Carolan liked edtech before the sector was cool, so the duo co-founded Reach Capital in 2015 with a $53 million debut fund. The San Francisco-based venture firm has since put checks into education startups including Newsela, Sketchy, ClassDojo and Outschool, landing six exits so far.
Now, after seeing its portfolio accelerate in the wake of the coronavirus, Reach is announcing its third fund aimed at backing edtech startups. Reach Capital III is a $165 million fund, the firm’s biggest to date. Reach’s team, which also includes Chian Gong, Wayee Chu and Esteban Sosnik, started raising the investment vehicle over the summer. New LPs in the fund include Sesame Workshop, National Geographic, Kaiser Foundation Hospitals and Goldman Sachs.
The Reach Capital team. Image Credits: Reach Capital
Reach plans to reserve half of its fund for follow-on investments for its startups, and the other half will go toward net-new investments. The firm intends to back 20 startups through Reach III, targeting about 15% ownership in each deal.
The edtech market raked in more than $10 billion in venture capital investment globally in 2020, but for students, parents and teachers, the past 12 months were defined more by its scramble than its surge. Reach as well as other firms have the opportunity to back startups that could change the broken bits, which is no easy feat.
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