Brisbane-based tutoring startup Vygo has raised $500,000 in pre-seed funding, bringing on board 13 backers to help propel it to the next stage of national growth.
Founded in 2017 by Ben Hallett, Joel Di Trapani and Steven Hastie, the startup graduated from Brisbane’s River City Labs and muru-D accelerator in May this year.
Hallett tells StartupSmart the startup’s app platform serves to stop university “students falling through the cracks”. It applies a sharing economy model to education by pairing students who have done well in a particular areas with those looking for extra support.
The app uses an institution’s class codes to make sure matches are relevant, and sessions are time-tracked and rated, in an effort to ensure quality.
So far some 5000 student profiles have been created, about a third of which are for tutors.
But this $500,000 in funding is pegged for scaling, with ambitions to eventually reach “a significant proportion of the Australian universities”, Hallett says.
There are also plans in the pipeline to expand overseas, however, Hallett is tight-lipped on where exactly Vygo will be heading first.
The funding round was led by Larsen Ventures, but also included repeat investment from River City Labs and muru-D, plus 10 additional angel investors, including Temando co-founder Carl Hartmann and Kinetic Agency co-founder Mark Livings.
Pulling in many investors “from very different backgrounds” was always part of the plan, Hallett says, and ultimately the startup found itself turning backers away.
Two of the angels were already on board as advisors, and Hallett says the team are already making full use of the rest as well, asking for introductions, knowledge of particular markets, and even opinions on a new logo design.
“They know the exact right people,” he says.
But while the investment was an end-goal for the founders, it’s also a little daunting.
“It simultaneously means a lot to us that other people are seeing the vision that we’ve had … we are proud about that,” says Hallett.
“But there’s also a whole new wave of accountability and responsibility, to have been given someone’s money and trust and have that expectation that you’re going to give that back to them with a return.”
There’s a sense of urgency no, but it’s a “good urgency”, Hallett says.
“It’s not just your skin in the game anymore,” he adds, “but it’s an exciting challenge”.
Hallett advises other early-stage startups looking for their first significant chunk of capital to first “know the audience that you’re going to be raising from”.
Startups should consider whether they’re looking purely for VC funding, or for angel investors, as “you have to approach those quite differently”, he says.
He adds that founders should “look for waves of momentum to ride on”, both with regards to their own company and the wider industry too.
Vygo’s River City Labs graduation demo day at the Myriad 2018 startup festival, provided the “perfect platform to tell our story from”, says Hallett, as well as the “perfect amount of energy and hype”.
The challenge was then “capturing the energy” and channeling it into the funding round.