Startup Degreed Raises PE Funding at $1.4 Billion Value

Degreed Inc., a software company serving human resource departments, said it has raised $153 million from investors valuing it at more than $1.4 billion.

Its valuation rose from $710 million last year, the company said.

Sapphire Ventures and Riverwood Capital led the round, which will be used to speed product development and global expansion and pursue acquisitions. McCarthy said Degreed generates annual revenue “right around $100 million.”

The company’s chief executive officer, Chris McCarthy, will step down and be replaced by Dan Levin, a former chief operating officer of Box Inc., according to a statement reviewed by Bloomberg News. McCarthy will remain on the company’s board and be a strategic adviser.

McCarthy had been at the company for eight years and CEO since 2017, according to the statement. He is stepping down to deal with a chronic back issue.

Levin left Box in 2017 and still serves on its board. He said in an interview that he looks to build on Degreed’s accomplishments to take the company to the next level.

Degreed, based in Pleasanton, California, provides training and career development programs. The company was founded in 2012 and has raised $335 million to date.

Venture capital funds have been flowing into companies that serve a remote workforce and help projects stay on track when employees aren’t interacting in person as much. Lattice, another software company for human resources, raised funds at a $1 billion valuation last month.

Kevin Diestel, a partner at Sapphire Ventures, said Degreed has thrived during the coronavirus pandemic because “companies are identifying that they need to address attrition in their workforce.”

Existing investors that participated in the round included Signal Peak Ventures, Owl Ventures, GSV Ventures and AllianceBernstein Holding LP.