StudentFinance Secures $5.3 Million Seed Funding

StudentFinance, a fintech company facilitating success-based financing for students, has successfully closed a $5.3 million (€4.5 million) seed funding round. The investment was co-led by Giant Ventures and Armilar Venture Partners, bringing the startup’s total funding to $6.6 million.

Expansion and Market Entry

Initially launched in Spain, StudentFinance subsequently expanded its operations to Germany and Finland. Plans are currently underway for a launch in the United Kingdom within the current year.

The funding round also saw participation from existing investors, including Mustard Seed Maze, Seedcamp, and Sabadell Venture Capital.

Core Technology and Services

Established in early 2020, StudentFinance delivers the technological infrastructure enabling educational institutions to offer adaptable payment options through Income Share Agreements (ISAs).

Furthermore, the company provides valuable data insights into the job market, forecasting employment trends and demands.

Current Traction and Partnerships

Currently, StudentFinance collaborates with 35 educational institutions, overseeing ISAs totaling over €5 million.

The platform also supports upskilling providers such as Ironhack and Le Wagon.

Key competitors in the market include Blair, Leif, Vemo Education (all US-based), Chancen (Germany), and EdAid (U.K.).

Differentiating Factors

According to Mariano Kostelec, co-founder and CEO of StudentFinance, the platform distinguishes itself by offering a complete, cross-border infrastructure for delivering ISAs.

“We not only support the ISA financing model but also provide employment market data and a career-focused platform designed to connect students with suitable job opportunities,” Kostelec stated. “This creates a balance between the availability of skilled workers and employer needs.”

The ISA Model and its Benefits

With an ISA, students begin repayment of tuition fees only after securing employment and exceeding a predetermined income level.

Repayments are structured as a percentage of their earnings, representing a “success-based model” that transfers financial risk away from the student. The increasing need for workforce reskilling, driven by digitization and the pandemic, is expected to increase the popularity of this model.

Founding Team

StudentFinance was founded in 2019 by Mariano Kostelec, Marta Palmeiro, Sergio Pereira, and Miguel Santo Amaro.

Prior to this venture, Kostelec and Santo Amaro co-founded Uniplaces, a European student housing platform that secured $30 million in funding.

Investor Perspectives

Cameron Mclain, managing partner at Giant Ventures, highlighted the platform’s ability to empower educational institutions to offer ISAs as an alternative to traditional tuition or student loans, thereby increasing access to education.

Duarte Mineiro, partner at Armilar Venture Partners, emphasized the strong business fundamentals and proprietary software technology underpinning StudentFinance’s compelling core purpose.

Sia Houchangnia, partner at Seedcamp, noted the critical need for workforce reskilling and StudentFinance’s potential to address this significant societal challenge.

Angel Investor Support

The startup has also attracted investment from a range of angel investors, including:

• Victoria van Lennep (founder of Lendable)
• Martin Villig (founder of Bolt)
• Ed Vaizey (former U.K. Culture & Digital Economy Minister)
• Firestartr (U.K.-based early-stage VC)
• Serge Chiaramonte (U.K. fintech investor)
• and others