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Home>Wharton Funding Startup Expands to Top US Business Schools: MBA News
Wharton Funding Startup Expands to Top US Business Schools: MBA News
Wharton Funding Startup Expands to Top US Business Schools: MBA News main image
The MBA startup, CommonBond, was launched last year by two first-year students at The Wharton School. It now invites students and recent graduates from a host of top US business schools to apply for funding.
The move follows the successful completion of a pilot scheme in which 40 Wharton students, or recent grads, were lent a total of US$2.5m – money that was sourced through ‘crowdfunding’.
Now, having raised in excess of US$100m through debt financing and the sale of equity, MBAs at 20 of the top US business schools have the chance to benefit from this startup’s mission to lower the cost of higher education in the US.
Yale and Harvard amongst top US business schools where students are eligible for CommonBond funding
The number of business schools to be found in CommonBond’s network currently stands at 20 and includes top US business schools such as Harvard, Columbia and Yale School of Management. MBAs from any of these schools are eligible to apply for CommonBond funding.
The idea came as a result of Wharton students, David Klein and Michael Taormina, wanting to provide an alternative to traditional sources of funding for business schools. One that they felt was fairer than existing student loan structures that carry exorbitant interest rates regardless of an MBA student’s likely earning power on graduation.
Taking into account an MBA’s ability to repay its loans, CommonBond feels secure in offering lower rates of interest, both to current students sourcing new funding for their program and to recent graduates needing to pay off existing school loans.
It is a for-profit exercise. However, CommonBond has moved to position itself as a socially responsible model by promising to “cover the education of a student in need abroad for a full year” for every degree that it fully funds. In addition, there are plans to fund ‘financial literacy education’ in local communities for each new city that joins the network.
Having begun with enterprising finance solutions, the long-term goal of CommonBond is to develop a community of investors through alumni and hedge funds.
Another innovative funding model that uses MBA alumni investments is Prodigy Finance – founded by INSEAD alumni in 2007. It encourages applications from international students joining MBA programs at leading European business schools, such as INSEAD and the London School of Business. Since its inception, Prodigy Finance has funded students of 84 different nationalities to the tune of US$36m and has yet to witness an MBA student defaulting on their loan.
Wharton Funding Startup Expands to Top US Business Schools: MBA News
By QS Contributor
Updated June 15, 2014 Updated June 15, 2014The MBA startup, CommonBond, was launched last year by two first-year students at The Wharton School. It now invites students and recent graduates from a host of top US business schools to apply for funding.
The move follows the successful completion of a pilot scheme in which 40 Wharton students, or recent grads, were lent a total of US$2.5m – money that was sourced through ‘crowdfunding’.
Now, having raised in excess of US$100m through debt financing and the sale of equity, MBAs at 20 of the top US business schools have the chance to benefit from this startup’s mission to lower the cost of higher education in the US.
Yale and Harvard amongst top US business schools where students are eligible for CommonBond funding
The number of business schools to be found in CommonBond’s network currently stands at 20 and includes top US business schools such as Harvard, Columbia and Yale School of Management. MBAs from any of these schools are eligible to apply for CommonBond funding.
The idea came as a result of Wharton students, David Klein and Michael Taormina, wanting to provide an alternative to traditional sources of funding for business schools. One that they felt was fairer than existing student loan structures that carry exorbitant interest rates regardless of an MBA student’s likely earning power on graduation.
Taking into account an MBA’s ability to repay its loans, CommonBond feels secure in offering lower rates of interest, both to current students sourcing new funding for their program and to recent graduates needing to pay off existing school loans.
It is a for-profit exercise. However, CommonBond has moved to position itself as a socially responsible model by promising to “cover the education of a student in need abroad for a full year” for every degree that it fully funds. In addition, there are plans to fund ‘financial literacy education’ in local communities for each new city that joins the network.
Having begun with enterprising finance solutions, the long-term goal of CommonBond is to develop a community of investors through alumni and hedge funds.
Another innovative funding model that uses MBA alumni investments is Prodigy Finance – founded by INSEAD alumni in 2007. It encourages applications from international students joining MBA programs at leading European business schools, such as INSEAD and the London School of Business. Since its inception, Prodigy Finance has funded students of 84 different nationalities to the tune of US$36m and has yet to witness an MBA student defaulting on their loan.
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This article was originally published in September 2013 . It was last updated in June 2014
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