Euan Blair is understandably quick to declare that his father — the former British prime minister and staunch advocate of the supremacy of university education — is a big supporter of his edtech start-up that aims to challenge just that.
While Blair senior wanted to put half of young people in Britain into universities, his son wants to change how people approach education entirely by creating rival vocational routes for young people.
But their goal is the same: to level the playing field for those who typically get overlooked for the best jobs because of their background or lack of access to money.
“At the time [the late 1990s] it was believed the more people who went to university, the more opportunity would be spread evenly, and that we would end up having a fairer society,” said Blair of his father’s ambitions in an interview with the Financial Times.
“It hasn’t panned out like that.”
Marketed as a buzzy alternative to university for talented young people, his start-up Multiverse uses automated predictive software to select apprentices, matching them with companies on the basis of aptitude and attitude rather than grades.
Applicants build a profile on its platform that replaces a CV, including video. Levels of engagement are tracked to see if someone is falling behind on learning targets. Digital platforms offer meetings with fellow apprentices, and trainees are given one-on-one mentoring and opportunities for networking.
Investors such as StepStone Group and Lightspeed Venture Partners are backing his vision. This month, Blair secured a $1.7bn valuation for Multiverse. The rapid growth of the newest UK “unicorn” surprised some observers given just 8,000 apprentices had so far passed through its training and placement programme.
But Blair, who co-founded the group in 2016, said the valuation reflected the future growth of a company he hopes will become present around the world. Multiverse has increased its revenue ninefold in the past two years, and he hopes to take the number of apprenticeships to 100,000 in “three or four years”.
“[Investors] look at the vision and what we’re doing, and the fact that this is about building an outstanding alternative to university, and something that can be global,” he said. “People believe that what we’re doing can be completely transformative, but also huge, and in the end, reach millions.”
Blair saw the need to democratise access to further education at first hand after leaving Bristol university with a degree in ancient history and a masters in international relations from Yale. He took a job at Morgan Stanley, where he found colleagues came from broadly similarly affluent and advantaged backgrounds.
“The thing that stuck was that everyone was from the same small handful of social backgrounds — it’s basically privileged, middle class people. And none of us had a divine right to be there,” he said. “But we were sort of being pre-vetted and pushed towards this, so I started to get much more interested in how to broaden out the spread of opportunities and education.”
Employers are also facing skills gaps at a time of falling college enrolment in the US. Although university figures remain robust in the UK, with just over four in ten 18-year-olds applying for entry, rising costs to students and no guarantee of entry into graduate-level careers have increased the appeal of alternatives.
Multiverse has not made a profit — Blair said because it is focused on customer growth, especially in the US where it now has more than half its business. The new money raised will go to funding that growth.
“The US is a massive priority for us. It’s a huge market, huge opportunity, because college is so fundamentally broken,” said Blair.
Much of the company’s revenue comes from employers paying it to run training and work packages for new and existing employees through the apprenticeship levy scheme in the UK, which requires larger companies to set aside a portion of their annual salary bill to fund training. In the US, companies pay for training directly.
The latest Multiverse fundraising of $220mn has bucked the more recent trend in edtech, with investment falling away after the early heady days of the pandemic when learning moved online. But the post-lockdown challenges of tight labour markets and skills shortages offer new opportunities for digitally focused companies.
Workplace automation, knowledge gaps in areas such as digital or sustainability and the need to retain staff mean so-called “enterprise learning” — products helping employers to train staff — has become “really attractive to investors”, according to Citi analyst Tom Singlehurst.
“In a service-based economy, investment in learning and development is self-serving because you want your people to have the right skills and it’s cheaper to retrain than fire and rehire,” he said.
Edtech by the numbers
So far this year, the global edtech sector has attracted $5.9bn in investment, according to Dealroom — far behind 2021 when it netted $21bn. But workplace skills-focused companies have attracted a decent share of that: four of the 10 biggest deals, including Multiverse, are in the subsector, according to VC firm Brighteye Ventures.
Guild Education, a US company which links adult learners to training, closed a $175mn funding round to reach a valuation of $4.4bn this month, and Handshake, a start-up connecting students to roles, hit a $3.5bn valuation in January.
Public companies like Coursera and Udemy, which market courses to individuals and for employers, are facing stiffer competition. Andy Bird, chief executive of Pearson, in February said the company would adapt to the “great resignation” trend by focusing on life-long learning — also a key aim for Multiverse.
But the edtech market is not without risk. Valuations for EU and US start-ups are considered to have benefited from China cracking down on the sector last year, removing some competition from the pool of available funding, but Beijing’s move also showed how susceptible education providers are to switches in local policies.
Another “massive concern” is that any economic slowdown will limit companies’ willingness to spend on training projects, warned Singlehurst. “As inflation kicks in and growth slows down and we’re on a recession footing this stuff is seen as nice to have rather than essential.”
But Multiverse’s should support the business ahead of rivals, according to analysts and investors.
Danny Rimer, partner at Index Ventures, an early backer of Multiverse, said the decision to reinvest was down to confidence in the company, rather than the category.
“The top 5-10 per cent of companies will be able to lean into this environment and Multiverse is clearly one of them,” he said. “There is a flight to quality.”
Widening the playing field
Multiverse employs more than 250 full-time “coaches”, but Blair stresses that on-job education was just as important. “They can actually start delivering on business objectives immediately as part of their learning — it’s really important.”
More than 200,000 candidates have applied to the group for apprenticeships, of which just 8,000 have secured positions with more than 500 companies such as Verizon and Cisco, in part owing to the whittling down process of its online admissions.
“The bar is very high to be a Multiverse apprentice,” he said, adding that more than half of successful applicants are women, more than half are people of colour and 35 per cent come from economically marginalised communities. “What we’re doing is finding exceptional talent but from much, much more diverse backgrounds than you might get from university.”
Blair is keen to play up the social elements too, having enjoyed this part while a student himself. He was once most famous for being found drunk by the police after a night out celebrating his GCSEs in the West End of London.
He said: “One of the things that’s always had such attraction around college and university is the idea of meeting people and networking. We embed all that within our apprenticeship programme.”
Not every apprentice ends up with a job, although Blair said Multiverse had a success rate of more than 90 per cent in long-term employment.
Shifting payment to the employer helped remove financial and social barriers and while using a platform to identify the best candidates meant the playing field was levelled for job hunters, said Blair.
He also sees a wider societal issue. “How do you make sure the best jobs in the next decade don’t simply go to all the same people as the best jobs in the last? Because if we can’t solve that piece, we’re going to end up with more people in society feeling that they don’t have a stake.”
Additional reporting by Tim Bradshaw and Cristina Criddle