Peergrade, a young company founded by a PhD student from DTU Compute, has joined the exclusive club of entrepreneurs under the American accelerator Y Combinator’s umbrella.
The American accelerator Y Combinator invests in small start-up companies, inviting them to a three-month intensive programme in San Francisco, where—among other things—they are given the opportunity to pitch their ideas to 2500 influential investors.
The DTU start-up Peergrade was selected for this summer’s programme—a stint of hard work and a huge opportunity for David Kofoed Wind from DTU Compute and his seven colleagues in the small company that has developed an electronic platform where students can evaluate each other’s assignments.
10,000 applicants seek to be selected for Y Combinator’s accelerator programme, which runs twice yearly.
Of these, 500 are invited for an interview in San Francisco—at Y Combinator’s expense—and 120 young businesses end up being accepted because they have the potential to become a global business phenomenon like Y Combinator’s greatest successes—Airbnb and Dropbox. So it goes without saying that David Kofoed Wind and his two co-founders of Peergrade were overjoyed when they received the news that they had been accepted onto the 2017 summer programme.
Three hectic months later we meet a tired, but very pleased David in Peergrade’s office in SingularityU’s domicile in Nørrebro, Copenhagen. He has taken leave from his PhD at DTU Compute to focus on developing the company and now only spends time in Lyngby teaching his course on machine learning and data analysis.
In its brief two years, Peergrade has managed to attract investors and generate revenue—not sufficient to register a profit, but enough to be receive Y Combinator’s invitation. This entails finding a place where the employees can sleep and work while they are in San Francisco—in this case a three-bedroom apartment with bunk beds costing DKK 40,000 a month! (EUR 5,400).
That said, the eight employees worked at least 30 hours more every week than normal, so it was a good investment when you consider all the programme benefits, says David.
"The beauty of Peergrade is that it can accommodate any teaching assignment—so the students can both learn about the subject and give and receive feedback—think critically and argue in support of their views."
David Kofoed Wind
Join the club
Y Combinator invests USD 120,000 for a seven per cent share of the company. This is the simple rule that applies to all—large and small. The programme also includes three months in San Francisco with dinners, talks, workshops, and meetings with investors.
“During the first two months, they tried to disturb us as little as possible. There were only a few events a week and you’re left to get on with building your product and chatting with users. We had a little trouble finding our users in mid-summer when all lecturers are on holiday, but we did manage to get hold of some primary and secondary school teachers who we paid to come,” says David.
The last month was devoted to securing a round of investment. It began with a day where everyone had exactly two minutes to pitch to 2,500 carefully selected investors, which in turn resulted in lots of meetings and long working days from six a.m. to midnight.
“It was rough, but ultimately worth all the graft—not least in light of the fact that Peergrade has now joined the Y Combinator club—a Freemason’s lodge for start-ups that have the unique advantage of being able to receive help from the extensive network of people who have been through the programme in the past 12 years. The programme is over and we’re using the money—but the network will always be there,” concludes David.
The plan is for Peergrade to be profitable within a year. The company already has lots of customers—primarily from the universities—but high schools and elementary schools are starting to follow suit.
“Our mission is to reach all classrooms in the world from year nine and upwards—also outside of the traditional education system. The beauty of Peergrade is that it can accommodate any teaching assignment—whether it is creative writing, philosophy, or maths so the students can both learn about the subject and give and receive feedback—think critically and argue in support of their views.”