The entrepreneur behind one of Waterloo Region’s tech unicorns is turning his sights on a new venture.
Martin Basiri announced today at the Collision tech conference in Toronto that he is launching a new company called Passage. Basiri, who co-founded ApplyBoard with his two brothers in Waterloo in 2015, said Passage will focus on helping international students obtain financing to attend universities and colleges in Canada so they can fill critical labour shortages in fields such as engineering, bioscience and skilled trades.
ApplyBoard, meanwhile, focused on helping international students to search, apply and gain acceptance to universities in Canada, the U.S., Britain and Australia.
Basiri also announced that Passage has secured $40 million CAN in venture capital financing from Drive Capital to help it get off the ground.
It can cost as much as $40,000 to $50,000 for a student from Iran or India to attend university in Canada, Basiri said in an interview. In those countries where the average GDP per capita is only $2,000 to $3,000 per year, “only the top, wealthy people can afford it.”
Yet, there are many bright people in these countries who cannot afford post-secondary education in Canada. Nor do they have government programs such as OSAP to provide financing. Passage will provide loans and grants to these students who will pay them back once they graduate and get jobs, he noted.
“Outside of Canada there are millions of geniuses. If you give them a little money they will come here and do amazing stuff.”
Passage, which is launching only in Canada for now, will also help immigrants obtain financing to land jobs here, Basiri said.
ApplyBoard, which Basiri launched with brothers Meti and Massi after the trio immigrated from Iran, made it easy for international students to find, apply and gain acceptance to colleges and universities in Canada, the US, Britain and Australia. The company was so successful that it raised a stunning $600 million CAN in venture capital financing, earning a valuation of $4 billion CAN and unicorn status. It employs about 1,500 people worldwide and has helped 500,000 students in 125 countries.
The company was launched out of the UW Velocity incubator with help from the Communitech Rev accelerator and two programs at Waterloo’s Accelerator Centre. Not long after starting ApplyBoard, Basiri noticed that the missing link was funding. Students from poorer families were being shut out.
“Since day one of starting ApplyBoard I was always seeing people that are brilliant. They are very, very capable students and just because they don’t have money they can’t come. And I thought, we must change this. There has to be a better way,” Basiri said.
“The biggest problem in accessibility to education is financial access, period.”
Basiri left his job as chief executive of ApplyBoard last fall but remains on the board of directors of the company. His brother Meti is now the CEO.
Basiri initially thought of running Passage as a non-profit foundation but soon discovered that the need was much too big to be solved in that fashion. “We need to get to billions of dollars in volumes of loans per year to solve this problem.”
He said he is hard at work trying to raise more money to provide financing for students. “I am killing myself to make it happen.”
The seed funding from Drive Capital will help Passage expand its operational capacity and “further develop its technological platform,” said a company news release. It will also be used on a pilot project to help more than 100 female students from Afghanistan “to access Canadian educational opportunities with clear career paths to fields facing acute worker shortages across the nation.”
Passage chose Afghanistan as a starting point because, under the Taliban regime, girls are not allowed to go to college or university, Basiri noted.
At the moment, Passage has fewer than ten employees and will be based in Kitchener and Toronto, he said.
Asked about competition, Basiri said there are some players in the financing field, “but the magnitude of the problem is so big that no one has been able to attack it” in an effective fashion.
“If it was a well-established industry, I would not have entered it.”
Basiri said Passage is designed to help people like him. He would not have been able to come to Canada in 2010 if he had not won a scholarship to study for his master’s degree in mechatronics engineering at the University of Waterloo.
“If Waterloo didn’t give me the money, I couldn’t come to Canada.”
He learned electrical engineering from his father and taught himself how to write computer software at a young age. “I learned how to code at age 14.” Married with an eight-month-old son, Basiri, 35, said his biggest influences were his parents. Both are educators. His father works in the electrical engineering field, and his mother is a retired school principal.
Basiri was moved to apply to UW after his uncle came to Canada and told him about a TV show called Dragon’s Den, where entrepreneurs could win up to $50,000 for a good idea. He was an inventor but didn’t have the money to turn his ideas into a company. After learning about Dragon’s Den, he began looking for a university nearby and landed on Waterloo.
Drive Capital, which also invested in ApplyBoard, said it was moved to invest in Passage because of its goal to address a serious labour shortage in skilled jobs. “Canada is facing a socio-economic crisis that must be addressed,” Nick Solaro, a partner in Drive Capital, said in the news release. “Martin and his talented team are doing just that.”
Basiri said Passage’s goal, proclaimed on its website, is to solve the problem of financial accessibility for international students by the end of the decade.