The Bill & Melinda Gates Foundation, the nonprofit fund created by the Microsoft co-founder and his wife, has made its first equity investment in a for-profit company: Inigral, a start-up that makes Facebook applications for educational institutions that want to "get your students engaged, from the point of admission through graduation." It's pitched toward schools that have problems with high dropout rates.
The Gates Foundation led the $4 million funding round, contributing $2 million. Retro Venture Partners contributed $1 million, as did the Founders Fund, a venture firm that counts early Facebook investor Peter Thiel and former exec Sean Parker among its partners.
Education has been a primary focus of the Gates Foundation, which has funded associate's degree programs, issued grants for e-learning, and invested more than $300 million to bring Internet access to libraries in developing countries. The Inigral investment is the first time that it's actually taken an equity stake in a company rather than funded a program with a grant; as a result of the Gates stake, Inigral will be working with the foundation to bring its software to schools that have been the recipients of Pell grants.
"The foundation's investment in Inigral reflects our interest in supporting innovative education technology and approaches with the potential to improve student success--especially among students who are the first in their family to attend college," Greg Ratliff, senior program officer for education and post-secondary success at the Gates Foundation, said in an announcement. "Leveraging social media to facilitate a student's integration into academic and campus life is a promising approach toward improving college completion rates in the United States."
Facebook, whose CEO Mark Zuckerberg made a nine-figure donation to one troubled school system last year, has been supportive of the investment as well: Director of platform partnerships Ethan Beard contributed a statement from the company to Inigral's announcement, saying that "the involvement of the Gates Foundation highlights the opportunity for start-ups like Inigral to build on Facebook to make an impact on education and create new opportunities for students."