The key issue in education is “garbage in, garbage out.” You can’t teach those who don’t want or can’t learn. In private education, this is an unsolvable problem since you are obliged to teach everyone who paid. However, in corporate education, this opens up interesting prospects! Here, you can create corporate educational platforms following the recipe of this startup. …
THE ESSENCE OF THE PROJECT
Companies whose business relies on frontline workers – couriers, drivers, waiters, salespeople, receptionists, etc. – face two major challenges.
Firstly, there’s a high turnover among frontline employees. 76% of them leave the company within the first 120 days of starting their job.
Secondly, there’s a lack of middle management – head waiters, senior salespeople, team leaders in packaging and logistics centers of e-commerce, etc. 75% of companies report difficulty in finding candidates for these roles. Recruiters are often reluctant to fill these roles because they are deemed “unfillable.”
Escalate promises to address both these challenges at once.
New employees stay in frontline roles not just for a maximum of 120 days, but for 12 months. The company builds a pipeline of candidates for middle management positions. A greater number of employees engage in upskilling, perform better, and deliver more value to their employers. The solution is simple but, as it turns out, effective. It’s professional training that helps newcomers ascend faster and more confidently from frontline roles to middle management.
This gives new employees a clearer understanding of how they can earn more while continuing to work for the same company and motivates them to strive for it.
During their first year, new frontline employees participate in educational online programs hosted on the Escalate platform aimed at overall skill enhancement. These programs include sets of recorded lessons and tests, as well as access to experts and coaches who assist in learning and development.
Employees are expected to devote 8–10 hours per week to their education. Training is conducted in groups, as it’s known that group learning is far more effective than individual study. One group, for example, might consist of frontline workers hired within the last month or even the last week.
The training is conducted entirely asynchronously; there are no common lessons or webinars that one must attend at a specific time. This is crucial to ensure that the training doesn’t interfere with work – as frontline workers often have shifting schedules. And with shifting schedules, it’s virtually impossible to choose a time that’s convenient for all learners.
During the second year, for those employees who successfully completed the first-year program and have not left the company, more specific three-month programs begin, aimed at filling middle management positions.
In these programs, students begin to acquire personnel management skills and also undergo internships in prospective positions, acting as understudies to existing managers. So, by the time an existing middle manager decides to leave the company or moves up the ladder, the company already has trained and prepared candidates in place.
Last November, Escalate graduated from the Techstars startup accelerator, securing the allotted $120,000 in investments. Now, they have raised their first substantial investment of $1.3 million, which is still considered “pre-seed,” as the startup is still at a relatively early stage of development.
What’s Interesting:
Today’s approach by Escalate serendipitously continues the narrative of the startup KindWorks.
Essentially, KindWorks sells companies courses on fostering emotional intelligence among employees, albeit functioning in the modern format of an AI chatbot.
However, companies purchase from KindWorks not just courses – but a solution to the problem of employee retention, which has recently become quite acute. KindWorks claims that nurturing “kindness” (how the startup has rebranded “emotional intelligence”) helps establish and strengthen human relationships within work teams, enhancing each employee’s work efficiency and preventing them from leaving.
Similarly, Escalate operates. It doesn’t sell companies a corporate training platform, nor does it sell them upskilling courses for employees. It sells them a solution to the turnover problem of frontline workers and the filling of middle management positions. The fact that companies pay for an educational platform and courses to solve this problem is just a technical detail 😉.
So, perhaps, the similarity in approaches between yesterday’s and today’s startups is not coincidental — it’s a confirmation that this approach is gaining popularity, hence it’s encountered more often among startups that managed to raise investments.
However, there’s a huge problem in any education which can be termed as “garbage in, garbage out.”
This problem is well known to those involved in data analysis. If a program receives a poor quality dataset, even the smartest analysis algorithms won’t help make quality conclusions out of poor quality data.
The same happens in education. If people who are unable or unwilling to learn are admitted to an educational program, it’s impossible to teach them anything. Because you can’t “teach” — you can only “learn”!
Escalate’s feature is that they have not just an educational platform where one can only take courses. A crucial component of the platform is an AI-machine that analyzes the behavior of students and assigns them “behavior scores.” These behavior scores, along with learning scores, contribute to an overall employee rating which influences whether the company will continue to invest time and effort in their education, and whether it will prepare them for promotion.
Importantly, the Escalate AI-machine analyzes not only the regularity and success of completing training programs — but also students’ behavior outside of education at their workplaces. For instance, missing work shifts, penalties for poor quality work, acknowledgments, and bonuses for achievements, as well as other relevant information accumulated in corporate personnel accounting systems.
Where to run
I’ll reiterate yesterday’s thought that corporate training is a good way to make money “out of thin air” with good checks. Of course, if one can overcome themselves — and start selling not courses, but solutions to a company’s problems, for which, coincidentally, certain training courses will come in handy 😉
An important addition to yesterday’s thought is Escalate’s feature of “behavior scores” for students at workplaces. Because such scores help companies not to waste money, effort, and time on training those employees who shouldn’t be trained, as there will be no benefit from it anyway.
As I said, the key problem of education is “garbage in, garbage out.” Only in private education this problem is unclear how to solve, because you have to teach everyone who paid for it 🙁 But in corporate education, the situation is different — you can teach only those who deserve it, and not only not teach everyone else, but also fire them 😉
So, the direction can be formulated as creating platforms to solve a company’s problems that can be solved through employee training. But with mandatory tools for filtering them based on work results — with the aim of a) identifying the most promising personnel for further and in-depth training, and b) weeding out those who do not show due diligence in their work.
To achieve this, it’s essential to understand which specific corporate platforms and what kind of data need to be integrated with the platform, what algorithms should be used for analyzing work behavior, and how to make the process of assigning these scores manageable and transparent, so that its effectiveness can be measured and improved.
It’s not excluded that such a behavior scoring module can even be structured and sold as a separate platform — if it’s capable of easily integrating with various educational platforms used in companies.
And this is yet another interesting and promising direction for potential movement!
About the company
Escalate
Website: escalateusa.com
Latest round: $1.26M, 11.10.2023
Total investments: $1.38M, rounds: 2