SANTA MONICA, Calif., Nov. 18, 2015 /PRNewswire/ -- Tuition.io, the market leader in student loan management, announced today that it has raised $5 million in Series A financing from MassMutual Ventures LLC, the corporate venture capital arm of Massachusetts Mutual Life Insurance Company (MassMutual); Wildcat Venture Partners; and Mohr Davidow Ventures, among others. This brings Tuition.io's total funding to $8.2 million.
"We are proud to have been the first to market at scale with an innovative financial wellness platform that enables employers to offer student loan payments as a benefit for hiring and retention," said Brendon McQueen, Tuition.io's Founder and CEO. "This commitment from MassMutual Ventures and Wildcat Venture Partners is a testament to the headway we've made in helping global companies attract and engage competitive talent while simultaneously addressing the $1.3 trillion student loan crisis in the U.S."
"Once the graduation ceremony has ended, and post-college life begins, many graduates face a crushing burden of student loan debt," said Mark Goodman, Managing Director, MassMutual Ventures. "The urgency of debt repayment can delay important choices, like saving for the future, which can affect financial wellness over a lifetime. Tuition.io has taken the lead in addressing this problem. Managing more than $2 billion in outstanding student loans, it has introduced this exciting and important new benefits category, which will enable thousands of people to realize their post-university dreams."
The new round of funding will help Tuition.io accelerate its enterprise customer acquisition; grow its sales, customer success and engineering teams; and further strengthen its position as the market-leading vendor for employer student loan contributions.
"Student loans have become a massive problem for college-educated professionals entering the workforce," said Bryan Stolle, General Partner, Wildcat Venture Partners and Mohr Davidow Ventures. "Tuition.io has been successfully assisting them with this challenge for several years. That help has taken a massive leap forward with their enterprise platform, empowering employers to recruit and retain employees with student loan contributions as a benefit. This is a real game-changer for recruiting millennials, and for helping to address this national crisis."
Recruiting & Retaining Top Talent
"Imagine you're a millennial presented with a slate of complicated benefit products that are simply not relevant to you," said McQueen. "For the more than 70 percent of college graduates coming out of school with an average of $35k in student loans, saving for retirement or health care needs is often just not possible. 401(k)s and even student loan refinancing as a benefit don't help if you can't contribute or don't qualify."
Since launching its employer benefits product in April, clients in industries ranging from legal to tech and financial services have implemented Tuition.io's platform and are already seeing results. "Our employees are thrilled with the program," said Esther Lem, CMO of Chegg. "It was only just implemented this year, and has already saved our team roughly 86 years in student loan payments. At Chegg, we're all about supporting higher education and we're happy to be able to offer a benefit to our employees that help them continue to learn and to succeed," Lem said.
It takes college graduates, on average, approximately 21 years to pay off their student loans. More than half of millennials, the largest generation in the U.S. labor force, have reported that they have put off saving for retirement due to their crushing student debt.
In addition to engaging millennial employees, employer student loan contributions present an opportunity to address the needs of minority employees as well. Of all the groups in the workforce, minorities bear the most student debt. Four in five (81 percent) black students borrow in order to pay for their education, and they borrow more and more often than white students. Similarly, Latinos are taking out loans at a higher interest rate than their counterparts, and as a result are paying back more money over a longer period of time. Offering student loan contributions as a benefit helps companies offer an incentive package that is hyper-relevant to these key demographic groups.
Tuition.io enables global companies to offer student loan payments as an employee benefit. It is the nation's leading student loan management platform, which has helped tens of thousands of borrowers organize over $2 billion in outstanding loans since launching in 2013. Tuition.io was first to market with an entirely customizable corporate student loan contribution platform that is secure, compliant and scalable. Typical users increase their monthly payments by between 4-8 percent and the site has shown a drastic 20 percent reduction of delinquent loans. The company was started after CEO Brendon McQueen graduated from Columbia University with 12 student loans and little understanding of his options. www.tuition.io or twitter.com/TuitionIO.
ABOUT MASSMUTUAL VENTURES LLC
MassMutual Ventures LLC backs entrepreneurial companies that are transforming the insurance and investment services markets through technology and business model innovation. Key areas of investment focus include FinTech, data analytics, cybersecurity, digital health, and enterprise software. MassMutual Ventures leads or joins investments into companies that are poised to create significant enterprise value through differentiated innovation and focused execution. Massachusetts Mutual Life Insurance Company (MassMutual) is the parent company of MassMutual Ventures LLC. For more information, please visit massmutualventures.com.
ABOUT WILDCAT VENTURE PARTNERS
Founded in 2015, Wildcat Venture Partners invests in early stage technology companies developing breakout solutions to high-value problems. Wildcat's name derives from the practice of wildcatting in the energy industry, where maverick entrepreneurs use deep expertise to target high-risk, high-return opportunities that mainstream institutions shy away from. With an eye to what has yet to be seen, Wildcat approaches problems idiosyncratically and orthogonally in order to stay away from the overharvested, overhyped, and already done. Wildcat. At Wildcat, we focus on specific thesis areas, including: FinTech, Digitization of Education and Health, Retail/eCommerce Innovation, Work Force Innovation, Cloud Enterprise & Infrastructure, Consumer Marketplaces and Services, and Quant Marketing & Digital Advertising. www.wildcat.vc
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