Education Fund FinTech Kaleidoscope Raises $10M in Series A

Education-based philanthropy FinTech platform Kaleidoscope has raised $10 million in a Series A funding round for scaling the business and investing in a funds disbursement solution, according to a Monday (April 4) press release.

Rally Ventures and 3×5 Partners co-led the funding effort, the press release says.

Kaleidoscope connects sponsoring organizations, donors and applicants and has handed over $370 million in scholarships and grants in the last two years. The company launched more than 6,500 programs and marked its millionth user in 2021. Proceeds from the financing will be used to scale the business and invest in the launch of a first of its kind funds disbursement solution.

“Where government programs have failed, the private sector is stepping up. And, we believe in any future scenario, they will continue to do so,” Kaleidoscope Founder and CEO Greg Dehn said in the company press release. “The bottom line is this: no qualified student in need should ever assume the burden of debt if they qualify for other means of funding, and no committed dollar should have such a hard time landing where it is needed most, in the pockets of students.

“The need on both sides is too great and the outcome is too important. Kaleidoscope’s platform eliminates this problem. Our partnership with 3×5 Partners and Rally Ventures opens new horizons for Kaleidoscope, allowing us to make critical investments in innovation and scale, with the aim of facilitating the transfer of scholarship funds from sponsor organizations to students,” he said.

More than $60 billion is channeled through sponsoring organizations to recipients to pay for higher education and advancement, according to the company press release. Roughly 20 million students attended college in 2021, including 4 million for the first time.

About 85% of first-year students received scholarship or grant aid, but $3.7 billion in federal grant aid went unused by students who didn’t complete the Free Application for Federal Student Aid.

Related: Today in the FinTech Ukraine Daily: Shift4, The Giving Block Announce $20M Crypto Philanthropy Campaign; Finance Software Maker Sievo Launches Procure4Peace.org

In mid-March, payment and commerce technology provider Shift4 launched a campaign to raise more than $20 million for nonprofits on The Giving Block, a cryptocurrency fundraising platform to support Ukraine relief efforts.

CEO Jared Isaacman said he will match the first $10 million in cryptocurrency donations through the initiative, “Caring with Crypto,” to create what he hopes will be the largest cryptocurrency fundraising campaign ever.