Henry Raises Funding to Expand Lambda School Model in Latin America

The burgeoning startup ecosystem in Latin America has seen significant venture capital investment, propelling companies like Rappi and NuBank to prominence. As these businesses grow, the demand for skilled professionals is increasing rapidly.

A seed-stage startup based in Buenos Aires, Henry, is aiming to address this critical need. The company has established an online computer science school dedicated to training software developers from underserved communities and preparing them for employment. Henry was founded by Luz and Martin Borchardt, alongside Manuel Barna Ferrés, Antonio Tralice, and Leonardo Maglia.

The company reports an estimated 1 million software engineering positions are currently available in Latin America, yet fewer than 100,000 individuals possess the necessary qualifications to fill them.

“Traditional higher education is accessible to only 13% of the population in Latin America,” explains Martin Borchardt, CEO and co-founder of Henry. “It’s often cost-prohibitive and doesn’t always equip individuals with the practical skills employers are seeking. We are providing an alternative pathway to opportunity.”

With 90% of its student body lacking prior formal higher education, Henry focuses on developing junior back-end and full-stack developers for the startup sector. The program is an intensive, five-month course running Monday through Friday, from 9 a.m. to 6 p.m., centered on essential software development skills. In addition to technical instruction, Henry provides career guidance, resume-building workshops, and ongoing professional development opportunities after graduation.

To enhance affordability, Henry is adopting a strategy similar to that of Lambda School, a Y Combinator graduate that has secured over $122 million in funding: income-share agreements. This model allows students to begin the program without any upfront tuition costs, and instead, they contribute a percentage of their income once they secure employment.

Lambda School’s income-share agreement requires students to pay 17% of their monthly earnings for 24 months after reaching a monthly income of $4,167, with a maximum total payment of $30,000. Henry’s terms are more favorable, reflecting the lower salary levels prevalent in Latin America. Henry students contribute 15% of their monthly income for 24 months once they earn $500 per month.

Students who are unable to find employment earning at least $500 per month within five years of completing the program are relieved of their repayment obligations.

Henry is also committed to increasing female representation in the field of software development. Currently, the company’s remote team is composed of 20% women and 64% men, a ratio mirrored in the student population.

A potential limitation of coding boot camps is that, while they can facilitate a transition from unemployment to employment, the absence of a traditional degree may hinder long-term career advancement. To address this, Henry has created a resource database for alumni, offering free access to up-skilling and reskilling opportunities in the latest technologies.

Successful job placement is crucial to Henry’s success. Currently, over 80% of students from the first cohort have secured employment, although it is still early to assess long-term outcomes. Approximately four Henry graduates are currently employed by the startup itself.

The demand for skilled talent in emerging markets has been recognized by others. Microverse, also backed by Y Combinator, is utilizing income-sharing agreements to expand access to education in developing countries, including those in Latin America. However, Henry believes its competitor’s approach is too broad.

“They are targeting all emerging markets and do not offer instruction in Spanish,” Borchardt stated. Henry, in contrast, concentrates on Spanish speakers, who comprise over 60% of its market in Latin America.

Regarding potential competition from Lambda School, the company that inspired Henry’s model, the founder noted that the well-funded organization has previously attempted, and failed, to expand into international markets like China and Europe due to regional complexities.

To date, Henry has graduated 200 students and is currently working with 600 students across Colombia, Chile, Uruguay, and Argentina. The company plans to expand into Mexico and introduce instruction in Portuguese.

To support this growth, Henry has secured new funding. Following its participation in Y Combinator’s Summer program, Henry announced today that it has raised $1.5 million in seed funding, led by Accion Venture Lab, Emles Venture Partners, and Noveus VC, with participation from several edtech angel investors from Latin America.

“I greatly value the strong personal connections between our instructors, staff, and students,” Borchardt said. “This is a key differentiator for Henry compared to a massive open online course. Our biggest challenge is scaling while preserving these valuable relationships.”