The Washington Technology Industry Association’s apprenticeship program just got a big boost from the federal government and a nod to take what it’s doing in Washington state nationwide.
The U.S. Department of Labor has awarded WTIA’s Apprenti apprenticeship program at $7.5 million contract to expand nationwide.
The local industry association launched its apprenticeship program late last year with the goal of training 600 job candidates– including at least 300 women, people of color and veterans – to fill roles at talent-starved technology companies. Originally funded by a $3.5 million federal job-training grant and recent $200,000 investment from JP Morgan Chase, the goal is to train individuals for roles that don’t typically require a college degree, including database administrators and project managers, and find candidates who can complete training programs already offered by technology companies.
Now the Department of Labor wants Apprenti to be the national model and help bridge the skills and diversity gap in the technology field across the nation. Congress set a goal of doubling and diversifying registered apprenticeship programs nationwide. The Bureau of Labor Statistics forecast a surge of over 1.3 million new computer programming and computer support specialist jobs by 2022. Less than 20 percent of the tech workforce is female, less than 3 percent is Hispanic or African American, and there are an even smaller number of veterans.
The funding from the feds is a slice of a $90 million funding pie that was set aside to expand job opportunities by collaborating with industry partners and develop registered apprenticeship programs in a number of industries.
“Millions of dollars being invested at the federal level in the Apprenti program validates the effectiveness of the registered apprenticeship model we have created for the tech industry. We will work tirelessly to expand this model on a national scale to bring new job opportunities to the underrepresented while delivering the tech skills our country needs,” Jennifer Carlson, executive director of Apprenti, said in a statement.
Most of LighterCapital’s portfolio companies have little outside investment, and only 20% end up taking venture capital, says BJ Lackland, LighterCapital’s CEO. Lighter Capital’s funds are backed byCommunity Investment Management, an impact investment firm promoting small businesses that create jobs in the US.
“The goal was to create a instrument that combines the best of debt and equity,” said Lackland in an interview. “You didn’t really have a funding option for people who just want a damn good business.”
The strategy comes with risks. Revenue-based lending is growing, but the creation of new SaaS startups appears to have slowed from its peak two or three years ago, reports venture firm Redpoint. New SaaS startup fundings dropped by more than half to 423 in 2015 over the previous year. A second worry is that a recession could reduce portfolio companies’ revenue. Repayment rates may fall or companies may slip into default with assets to claim (so far, Lighter Capital reports, default rates are under 2%).