System-3 has raised $3.6 million CAD in seed funding as part of the company’s efforts to mitigate inherent bias when hiring or promoting executive leaders.

Round13 Capital led the Toronto-based startup’s round, which also included participation from undisclosed angel investors.

“What we are doing is no different than the aviation industry, which has long relied on simulation.”

System-3 has developed a software-as-service (SaaS) platform to evaluate potential leadership talent within a company. The company’s mission is “fundamentally changing how organizations manage their leadership talent.”

The startup has developed what it calls  unbiased and predictive “Leadership Simulation measures.” Its platform is meant to help companies in their evaluation and selection of candidates for executive leadership roles.

System-3’s tech offers what the company calls immersive simulations that look at complex decision-making for real-life executive business challenges. It then evaluates the results “against a benchmark of current, successful diverse executives and against client corporate benchmarks.”

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System-3 first launched its platform in May 2022, a year after its founding by CEO Elan Pratzer. Pratzer launched System-3 after working in the executive search sector for 30 years.

“What we are doing is no different than the aviation industry, which has long relied on simulation technologies to both determine a pilot’s readiness in a life-or-death situations and train already established pilots,” said Pratzer. “Why not apply this methodology to see how people would lead a company?”

System-3 is set to use its seed capital to continue developing its platform and extend its reach globally. Focuses for the startup include building a partner channel and growing its sales and marketing teams.

“The methodologies that are widely used today for talent evaluation and selection at the senior levels of an organization – specifically relying on subjective information that limits choice and results in costly and misguided hiring decisions – is a process that is ripe for change,” said Brahm Klar, partner at Round13.

Feature image courtesy Unsplash.

The post Round13 leads System-3’s $3.6 million round to mitigate bias in hiring leadership talent first appeared on BetaKit.

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