Over the past year, New Markets Venture Partners, an impact investing firm based in Fulton, Md., ploughed $18 million across nine portfolio companies — two new investments, and seven follow-ons, as it focused on restructuring its portfolio companies, the company told its investors in a newsletter last week.
In an annual report, the company identified San Francisco-based Censia, an AI-driven talent intelligence company, and Chicago-headquartered Acceleration Academies, which reengages young adults not experiencing success in a traditional high school setting, as its new investments.
‘Disciplined Pace of Investing’
As part of its focus on portfolio companies, New Markets said it led recruiting efforts at four of its portfolio companies, “bringing on exciting new CEOs for their next phase of growth.” It also hired three new CFOs for portfolio companies, worked toward restructuring bank debt, syndicated capital and signed a letter of intent for a rollover exit to an attractive buyer.
“We believe our disciplined pace of investing and intense strategic portfolio company support in the face of adversity will be the key to winning as we emerge from the post-pandemic down cycle in a much stronger position,” New Markets, which has focused on startups in education and workforce, told its investors.
The firm screened about 750 deals, conducting diligence on 31 and eventually investing in an exciting, high-growth deal, Censia, which uses AI and big data to change how employers measure talent through sophisticated skills inference and mapping technology. Early this year, it invested in Acceleration Academies.
Headwinds Easing
“We believe that our hard work has begun to pay off and our portfolio is well positioned to thrive, emerging stronger than ever after a record number of startup failures in 2023 and 2024,” it added, citing Carta data.
Three of the firm’s portfolio companies — Mursion, Noodle, and Orijin — made Time magazine’s Top EdTech Companies List this year. Additionally, Noodle and Pathstream were named in the GSV 150, The Most Transformational Growth Companies In Digital Learning and Workforce Skills.
New Markets also cited headwinds that have impacted the education and workforce space for the past few years as stimulus dollars dried up, “returning demand for new technology products across K-12 to pre-pandemic levels.”
Higher education enrollments continue to decline and employers in the technology sector have reduced hiring after massive layoffs, it pointed out. However, these “headwinds are beginning to stabilize as K-12 and higher education administrators are now working with rationalized budgets and are laser focused on purchasing only quantifiably high ROI products and services.”
Exec Hire
New Markets also announced the hiring of a new vice president for finance and operations, Becky Spezzano. Previously she was a senior accounting manager at StepStone Group, a multi-strategy private equity platform with over $150 billion in assets under management. Spezzano is a CPA with a B.S. in Accounting from West Virginia University.
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The Maryland impact investing firm is led by co-founders and general partners Mark Grovic and Robb Doub, both of whom have three decades’ experience in investing and building high-growth information technology and business services companies. The firm eyes the so-called “double bottom line” — a measurable social outcome, in addition to financial profits. Its focus on educational startups has a reason — nearly a third of Americans have no college degree and less than 30% of students have adequate reading and math skills. Since its founding in 2002, New Markets has made over 50 portfolio investments.
Grovic previously cofounded the online educational firm LifeJourney and the Templeton Emerging Europe Fund. He also served as the VC-in-Residence at the University of Maryland University College’s Smith School and was an award-winning private equity professor for over 20 years. Most recently, he was a professor of Social Entrepreneurship and senior advisor to University of Maryland’s president for Corporate Development.
Doub is an alumnus of Georgetown University’s McDonough School of Business. Prior to starting New Markets, he was managing director of the SEAF Central and Eastern European Growth Fund.
