Top Hat has raised $9 million in its Series C follow-on funding from Toronto-based Leaders Fund. The company raised its $29.5 million Series C back in February.
At the same time, the company also announced the launch of its Top Hat Marketplace, which has been in beta since the fall. The Marketplace allows professors to publish, share, and collaborate with peers on course material. In turn, professors can create customized and interactive educational content for students.
“The company has experienced impressive growth and we’re excited by what the future holds.”
– David Stein, managing partner of Leaders Fund
“We leveraged our existing relationship with educators already using our classroom engagement tools to test and launch the Marketplace,” said Mike Silagadze, co-founder and CEO of Top Hat. “The Marketplace finally puts educators — the people at the forefront of learning — in charge of their course materials. This is a fundamental shift in education, and we’re excited to provide Top Hat educators with a community focused on quality content and better teaching, while also creating an effective learning experience for students.”
The company says it’s a break from the current slow-paced publishing model, which entails working with large publishers dedicated to traditional textbooks that can take years to publish. With the Marketplace, professors can receive recognition for their content by receiving royalties when it’s adopted by other academics, and publish textbooks within months through collaboration.
“We see it as a completely new model of decentralizing the process of creating content to be used in colleges and universities, so if you think about the traditional publishing model and the way it exists today, it hasn’t really changed in a couple hundred years,” said Nick Stein, CMO of Top Hat.
“A traditional textbook can’t really keep up with the pace of change of the world that we live in.”
– Nick Stein, Top Hat CMO
When the company raised its Series C, it said that it wanted to use the funding to tackle the “overpriced” textbook industry. With that mission starting to come to life, Stein says that raising the round from Leaders Fund was a matter of accelerating their growth and getting access to Leaders Fund’s expertise. Leaders Fund launched last year with $100 million by past entrepreneurs, and is headed by David Stein, founder of Rypple.
“Investing in Top Hat was an easy decision,” said David Stein. “The education technology market is notoriously difficult, but Top Hat’s educator-first approach and mission to improve classroom engagement by putting the teacher at the centre really stood out to our team. We’re particularly excited about the potential for the Top Hat Marketplace — a unique approach to making higher education more economical, engaging and effective. The company has experienced impressive growth and we’re excited by what the future holds.”
While edtech is generally seen as a challenging industry to break into for startups, Stein says that the company has already built relationships with individual professors through its core offering, which allows professors to connect with students through their smartphone and to take attendance, deliver course content, and administer engagement activities like polls inside the classroom.
“We had thousands of professors who are using our platform already for in-class student engagement, so this was just our ability to expand that relationship,” said Nick Stein. “If you look at the way that university is taught today, a traditional textbook can’t really keep up with the pace of change of the world that we live in, so professors were already for many years forced to try alternative ways of bringing different content into their class.”