Upskilling Platform Degreed Raises $153 million in Series D Funding
Now Valued at over $1 Billion, Degreed also announces former Box COO Dan Levin to succeed Chris McCarthy as CEO
Upskilling platform Degreed has raised $153 million in Series D funding. The investment, which was co-led by Sapphire Ventures and Riverwood Capital, values the company at $1.4 billion. Dan Levin, former COO of Box, will succeed Chris McCarthy as CEO of Degreed. McCarthy will remain in a strategic advisory capacity and sit on Degreed’s Board of Directors.
The funding will be used to accelerate product development, enhance data infrastructure, fuel global expansion, and pursue strategic acquisitions. Technology enhancements will focus on upgrading Degreed’s reporting and analytics, ensuring best in class security, and enhancing integrations that take Degreed deeper into users’ daily workflow.
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After almost eight years at Degreed, McCarthy is stepping down as CEO to address a chronic back issue. McCarthy led Degreed through a period of significant growth with compound annual revenue growth of 76% and an 800% increase in enterprise value during his three and a half years as CEO. In 2020 alone, Degreed more than doubled its active user base and increased its team by 50%, to 600 employees, across six continents, while making major investments in product extensions to support the upskilling initiatives of our enterprise customers. Degreed was also recently named one of America’s Best Startup Employers by Forbes. Levin is taking over as CEO at an exciting time for the company.
“When the Degreed Board and I put this transition plan in place last year, the goal was to be as successful as we were in 2017 when co-founder David Blake made me the CEO. After a months-long process, we’re thrilled to have someone of Dan’s caliber driving the next phase of our growth.” said McCarthy. “Dan’s extensive experience scaling high-growth companies aligns with our future trajectory. He’s not only a great operator, but an exceptional leader and coach who is deeply connected to Degreed’s mission.”
“I am delighted to join the Degreed team. Chris and the entire company have done an amazing job delivering a service that over one-third of Fortune 50 companies use every day to retain, reskill and develop their most valuable employees. The workforce of the future will need to build and activate new skills on a continuous basis, and we are uniquely positioned to help them do just that,” said Levin.
A unique moment in HR Technology
“Organizations are changing their approach to talent and skills post-COVID-19,” said Kat Kennedy, President and Chief Experience Officer of Degreed. “Despite billions of dollars of investment in HCM, talent and learning systems, most workers still don’t see a clear path to career growth at work. And most businesses still don’t have effective ways to sense and respond to shifting demand for workforce skills. Degreed is helping to solve that by integrating skills intelligence with all of the ways people learn and grow on-the-job — all in one simple, fluid experience.”
Data about skills is essential for businesses navigating change. According to Gartner, 53% of HR leaders say the inability to identify needed skills is the biggest impediment to workforce transformation. However, that data is often difficult to get from legacy HR, learning and talent systems. Brandon Hall Group data shows half of talent leaders say their organization does not have the right technology to assess and track workers’ skills. Six in ten are looking for better technology.
“Research shows that today’s employees are eight times more likely to work for a company that they trust will provide them with career opportunities, even if their job changes or goes away. And businesses that can quickly reallocate talent to the most critical strategic priorities are more than twice as likely to outperform their competitors on total returns to shareholders. That’s exactly what Degreed does, and that’s why we’re excited to partner with Degreed and be part of the company’s future,” added Kevin Diestel, Partner at Sapphire Ventures.
“Investing in skills, culture, and career growth has become a critical differentiator for employers,” said Jeff Parks, Co-Founder and Managing Partner at Riverwood Capital. “Under Chris’ leadership, Degreed has transformed the learning experience and upskilling conversation. We are thrilled to build on that vision in partnership with Dan and this incredible team, and are focused on the next phase of their scalability journey and supporting their mission to equip people with the skills they need to redefine their careers, their companies, their fields, and the world.”
The total funding round including equity and debt reached $183 million and included participation from current investors Signal Peak Ventures, Owl Ventures, GSV Ventures, Founders Circle, Contour Investment Partners, Section Partners, and Alliance Bernstein, as well as new investor Firework Ventures.