Transfr, a startup dedicated to creating virtual reality tools for training and career advancement, has just announced a successful Series C funding round, raising $40 million. The lead investor in this round is ABS Capital, with participation from JPMorgan Chase Impact Finance, Advisory, Lumos Capital Group, Akkadian Ventures, Spring Tide Capital, Firework Ventures, and Album. This funding round brings Transfr’s total capital raised to $90 million.
The CEO and founder of Transfr, Bharani Rajakumar, stated that these funds will be directed towards several key areas of development. This includes expanding Transfr’s executive team, scaling up the platform, and investing in the creation of new training simulations that encompass a wider array of skills and scenarios. Additionally, Transfr intends to enhance its offerings by expanding its foreign language courses, particularly those in Spanish.
Rajakumar emphasized the importance of this funding round in facilitating the growth of Transfr’s virtual reality simulation and training platform. The company has experienced remarkable growth, with its customer base more than doubling year over year from 2019 to 2023. This growth has expanded its reach from serving customers in just one state to partnering with nonprofit organizations, public sector entities, and enterprises in over 40 states.
Transfr, Rajakumar’s second venture following the success of LearnBop, a math tutoring app acquired by K12 in 2014, focuses on bridging the skills gap in industries like manufacturing. The platform combines virtual reality demonstrations with hands-on training, offering learners realistic experiences guided by a digital coach. These training programs cater to “middle skills” jobs, which require more training than a high school diploma but less than a four-year college degree. Such jobs constitute a significant portion of the U.S. labor market, yet a large percentage of workers lack the necessary training.
While VR may not fully replicate on-the-job training, Rajakumar underscores that Transfr’s courses are developed in collaboration with subject matter experts and eliminate the need for expensive equipment, materials, and specialized facilities.
There is evidence to support the efficacy of VR in workforce training, as a PwC study found it to be 52% more cost-effective than traditional classroom training for a corporate class of 3,000 learners. Deloitte predicts that by 2024, 25% of company office meetings will incorporate virtual reality, and by 2025, around 70% of employee training will involve VR in some capacity.
Transfr is not a free service; it generates revenue through software-as-a-service licensing fees for customers, who must also acquire the necessary headsets to use the platform, such as Meta’s Oculus Quest headset with Oculus for Business. Nonetheless, Rajakumar argues that Transfr remains more accessible than many real-world upskilling programs.
Transfr aims to serve a diverse range of individuals, from high school students exploring career options to adults seeking career stability and formerly incarcerated individuals looking to re-enter the workforce. Rajakumar describes Transfr as an economic development platform that collaborates closely with both public and private entities to build pathways from the classroom to meaningful careers.
In summary, while Transfr may not completely replace professional classroom instruction, its platform holds promise in helping individuals acquire the skills necessary for well-paying jobs and contributes to economic development.
