News & Events

news source:https://betakit.com/applyboard-co-founder-launches-passage-to-address-canadas-skilled-worker-shortage-with-40-million-seed-round/

After spending seven years helping international students apply to study abroad with Kitchener-Waterloo EdTech unicorn ApplyBoard, Martin Basiri has set his sights on a new challenge.

The ApplyBoard co-founder and former CEO’s new startup, Passage, aims to help fill Canada’s skilled labour gap.

Founded this year and armed with $40 million CAD in initial seed funding led by Ohio-based Drive Capital, Passage is building a software platform designed to match international students and immigrants to Canadian workforce needs and connect them with financing.

Whereas ApplyBoard enabled international students of means to apply to study abroad more easily, Kitchener-Waterloo’s Passage aims to help skilled folks in foreign countries who lack financial resources secure the funding required to learn and work here—a barrier that prevents many from coming to Canada in the first place. It will target both job seekers and people looking to apply to school.

In an interview with BetaKit, Basiri noted that ApplyBoard caters to international students who can already afford to attend post-secondary school in a new country. “On ApplyBoard, you must have money. At Passage, we say, ‘Hey, if you don’t have money, it’s okay, go apply.’”

Through Passage, Basiri hopes to help smart, prospective immigrants looking to study and work in in-demand fields like science, technology, engineering and mathematics, cybersecurity, and health care, but can’t afford to migrate.

“With thousands of jobs sitting unfilled in the economy, affecting goods and services Canadians need, Canada is facing a socio-economic crisis that must be addressed,” Drive Capital partner Nick Solaro said in a statement. “Martin and his talented team are doing just that.”

Drive Capital previously led ApplyBoard’s Series C round. Basiri declined to disclose the other investors in Passage’s seed round but claimed it also saw support from other previous ApplyBoard backers.

ApplyBoard most recently raised $375 million CAD in Series D financing led by the Ontario Teachers’ Pension Plan Board in 2021 at a $4 billion valuation.

Basiri quietly departed as ApplyBoard’s CEO last summer and was replaced by his brother Meti in a move that the company didn’t officially announce until early 2023.

For international students and immigrant workers, coming to Canada can be expensive, and accessing loans and other forms of financing are often particularly difficult. “Only the top one percent of wealthy people can afford to come here and [take] this life-changing opportunity,” said Basiri. “But what if the financial barrier wasn’t an issue?”

Basiri initially left ApplyBoard last summer and launched a charitable foundation to help tackle this issue, but said he soon realized the problem called for another strategy. “The scope of the problem is bigger than just one charity,” he argued. “We need a platform.”

Basiri launched Passage in February, and closed this seed round shortly afterwards, in March. Beyond the top-line amount, the Passage founder and CEO declined to disclose the financial terms of the deal.

Passage plans to take into account a variety of factors, such as target school, field of study, degree type, skillset, city, profession, and job market, in order to evaluate candidates’ future earning potential. “Everything we do is with data, data data,” said Basiri.

With this approach, Basiri expressed confidence that Passage will be able to find backers willing to support its vision and lend to new Canadians.

Passage plans to use this seed funding to develop its software and build out its operational capacity, as it looks to bring on its first batch of students in 2024. The startup also intends to execute its first pilot project, designed to help over 100 female-identifying students from Afghanistan access education in Canada with clear paths toward fields with worker shortages.

Basiri acknowledged that given the state of the economy, it is an “extremely tough time for lending businesses.” But the CEO said he embraces the challenge. “If I make Passage work at this time, it will work for any time,” he said.