Cherry Tree & Associates | December 2021 | Volume XVI, Issue 6 |
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Seaside Equity Acquires Cascade Healthcare Services
Seaside Equity, the San Diego-based private equity firm, has acquired Cascade Healthcare Services, a technology-enabled provider of continuing education and training services to healthcare professionals throughout the Pacific Northwest and California. Founded by Paul Regalia in 2002, Cascade provides required certification training services to over 70,000 professionals annually, partnering with leading medical research organizations including the American Hearth Association, American Red Cross, Emergency Nurses Association, and the American Academy of Pediatrics.
Cherry Tree and Associates served as Cascade’s exclusive sell-side advisor in the transaction.
shoutout.wix.com
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PresenceLearning Acquires Global Teletherapy
PresenceLearning, a provider of teletherapy and software for special education and mental health providers in K-12 schools, acquired Global Teletherapy, a teletherapy service provider to virtual K-12 schools. In conjunction with the transaction, PresenceLearning signed a definitive agreement with Spectrum Equity and The Rise Fund to acquire a majority stake in the Company. Bain Double Impact and Catalyst Investors will retain minority stakes in PresenceLearning and Bain will continue to have representation on the Company’s Board of Directors.
businesswire.com
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Colibri Group Acquires TeachNow, Inc.
Colibri Group, a professional education company providing learning solutions to licensed professionals acquired TeachNow, a technology-centric teacher certifications company that provides professionals with the opportunity to transition into teaching. With this acquisition, Colibri Group expands the company’s business internationally and incorporates a new category of professional education into its family of businesses.
gridironcapital.com
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Leeds Equity Invests in 95 Percent Group
Leeds Equity, a New York-based private equity firm dedicated exclusively to partnering with management teams in the education, training, and information and data management services industries, has made a significant investment in 95 Percent Group, a provider of whole class and intervention literacy curriculum products and services to districts and schools across the U.S. Founded in 2005, 95 Percent Group’s mission is to help educators identify and address the needs for struggling readers using an approach that is aligned with Structured Literacy.
prnewswire.com
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PDH Academy Acquires OphthoQuesttions and SunCam
PDH Academy, Eden Capital’s platform investment in profession and continuing education in healthcare and specialized trades, acquired OphthoQuestions and SunCam. OphthoQuestions is a leader in ophthalmology online test preparation and continuing education and complements PDH's existing eye care offerings. Board Wizards, its podiatry-focused sister company, provides comprehensive board test prep solutions as well as supplemental learning courses. SunCam has been a global provider of engineering continuing education and training since 2002 and offers convenient online courses for engineers across all disciplines.
globenewswire.com
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Eruditus Raises $650 Million
Eruditus, the Mumbai, India-based education technology provider, raised $650 million from GSV Ventures, CPP Investments, Accel and Softbank Vision Fund 2, brining its valuation to $3.2 billion. Eruditus offers post-secondary level courses from top universities online, much like Coursera. The Company reports having $175 million in bookings in 2021 and is on-track to achieve $450-$500 million in bookings for fiscal year 2022. Apart from India, the firm is also partnering with universities in Brazil and Costa Rica, among other countries.
yourstory.com
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Bloomsbury Acquires ABC-CLIO
Bloomsbury Publishing, a British worldwide publishing company, acquired California-based academic ABC-CLIO in a $22.9 million deal. ABC-CLIO has four imprints and 32 databases that provide curriculum-aligned content and lesson plans, with more than 23,000 titles in its portfolio. ABC-CLIO will operate within Bloomsbury’s Academic and Professional division and its databases will be included within Bloomsbury Digital Resources.
thebookseller.com
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Teacher Created Materials Acquires Free Spirit Publishing
Teacher Created Materials (“TCM”), the global education material developer, acquired Minneapolis-based Free Spirit Publishing, the social-emotional learning and early childhood education provider. Free Spirit will continue operations from its Minneapolis location. TCM plans on maintaining the popular Free Spirit brand while merging the editorial, sales and marketing, and operations teams over the coming months.
freespirit.com
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Lecturio Raises $45 Million
Lecturio, a German-based company providing learning solutions in law, medicine, tax, and business, raised $45 million in growth capital, led by Sterling Partners. Sterling Partners partnered with Inspara Partners on the investment, whose principals have long been affiliated with Sterling. The Company plans to use the new funds to expand its global footprint, further strengthen its product offering in medical and nursing education and support a consolidation strategy in the fragmented healthcare education solutions market.
prnewswire.com
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Goalsetter Raises $15 Million
Goalsetter, a financial education platform for students, has raised $15 million in a Series A financing round. The funding was led by Seae Ventures with participation from Fiserv, Mass Mutual Catalyst Fund, Citizens Financial Group, Astia Fund, NBA stars Kevin Durant and Carmelo Anthony, and actors Anthony Anderson and Lance Gross. The startup’s app allows kids to get an allowance or monetary gifts from friends, parents, and relatives, or spend money through a Goalsetter debit card. However, prior to spending, students must take financial literacy quizzes to ‘unlock’ those funds, with the difficulty of questions tailored to the kid’s age.
techcrunch.com
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uLesson Raises $15 Million
uLesson, the African EdTech startup, closed a $15 million Series B round. The investment, which comes 11 months after uLesson raised a $7.5 million Series A, was completed by five investors: Nielsen Ventures, Tencent, and existing investors Owl Ventures, TLcom Capital and Founder Collective. Founded in 2019, uLesson has evolved to offer lessons, quizzes, and a homework help feature that connects students with tutors from universities.
techcrunch.com
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Educate Online Raises $4 Million
Educate Online, a platform allowing international students to study at U.K., U.S., and Canadian schools, raised $4 million in seed funding from Xploration Capital, TMT Investments, Flyer One Ventures, Softline and Angelsdeck. In the past 12 months, the startup says it’s garnered 2,500 students from 18 countries, covering K-12 study, ESOL, career exploration, university preparation, and internship and mentorship programs.
techcrunch.com
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Skillsoft Acquires Codeacademy
Skillsoft (NYSE:SKIL), the Boston-based software provider of training and classes in leadership development, workplace harassment prevention and coursework to qualify as a system engineer, acquired Codeacademy, a U.S.-based educational technology company, for $525 million in cash and stock. Codeacademy offers free, basic online computer coding classes in areas such as programming, data science and cybersecurity. In February, Codeacademy raised $40 million in new funding, seeking to expand into markets such as India where a high percentage of people are pursuing engineering degrees.
wsj.com
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Veritas Capital to Acquire Finalsite
Veritas Capital, a private equity investment firm, has signed a definitive agreement to acquire Finalsite, a global provider of school websites and digital communication tools, from Bridge Growth Partners. Headquartered in Glastonbury, CT and founded in 1998, Finalsite provides SaaS solutions to an estimated 8,000+ schools and universities across 115 different countries. The transaction is expected to close at the end of 2021.
businesswire.com
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Course Hero Raises $380 Million
Course Hero, the education platform offering a suite of learning resources and tools, raised $380 million in a Series C round, valuing the Company at $3.6 billion. The round was led by Wellington Management with participation from new investors Sequoia Capital, OMERS Growth and D1 Capital, as well as existing investors including GSV Ventures, NewView Capital and TPG. The funds will support investment in the platform to address the whole learning journey and allow the Company to expand into new verticals, subject areas, grade levels and geographies.
prnewswire.com
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American Safety Council Acquires TPC
Frontenac, a Chicago-based private equity firm, has completed the sale of TPC, a provider of industrial skills and workplace safety training, performance management, and environmental health & safety (“EHS”) compliance software solutions, to American Safety Council. Headquartered in Chicago, TPC provides workforce training, performance, and compliance solutions to organizations of all sizes, ranging from Fortune 1000 companies to small businesses and workers that span multiple disciplines from industrial to foodservice.
prnewswire.com
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Onex Partners to Acquire Tes Global
Onex Corporation (TSX:ONEX), a Canadian-based investment management firm, acquired Tes Global, an education technology services provider, from Providence Equity Partners, a private equity firm specializing in growth-oriented investments in education, media, and technology. Based in London, Tes Global provides comprehensive software solutions for the education sector with a core vision to power schools and enable great teaching worldwide.
globenewswire.com
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Riverside Company to Acquire iCEV
iCEV, a Career & Technical Education (CTE) curriculum, instructional materials, and industry certifications company, has signed a definitive agreement with the Riverside Company, a global investment firm. With nearly 40 years of experience in the CTE space, iCEV, which has been operating in Lubbock, TX since 1984, serves educators and students in the K-12, post-secondary, correctional, workforce and adult education settings. iCEV will continue operating out of its headquarters in Lubbock with plans to expand operations, course offerings and platform functionality.
lubbockonline.com
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Transom Capital Acquires Aspen Publishing
Transom Capital Group, an operations-focused middle-market private equity firm, acquired Wolters Kluwer’s Legal & Regulatory U.S. Legal Education business, and the business has been renamed to Aspen Publishing, a premium brand in legal education content and digital learning. The Company provides study aids, a digital bookshelf, and Connected Quizzing.
finance.yahoo.com
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BEGiN Acquires Little Passports
BEGiN, the company behind early programs HOMER, codeSpark Academy, and KidPass, acquired Little Passports, the activity kit subscription service known for awakening kids’ curiosity about geography, culture, science, and arts. The recent acquisitions of codeSpark Academy, KidPass, and Little Passports highlight BEGiN’s effort towards becoming a leader in early learning, having reportedly served over four million families to date.
prnewswire.com
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LingoAce Raises $105 Million
LingoAce, a Singapore-based global education technology company and Mandarin Chinese language learning program, closed on a $105 million Series C funding round, led by Sequoia Capital India, with participation from Owl Ventures, Shunwei Capital and SWC Global. This comes less than a year after a $55 million Series B funding round, led by Tiger Global and Owl Ventures. The Company plans on using the new funds to advance its mission to make new language learning fun, immersive, and interactive for children.
businesswire.com
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Atom Learning Raises $25 Million
Atom Learning, a London startup that builds AI-based online education materials aimed at 7-11 year-olds, raised $25 million. The new capital, the Company reported, will be used to continue its growth in the U.K. market. The funding comes from SoftBank, via its Vision Fund 2, and Atom claims that this sum is the largest-ever for a Series A round for a U.K. EdTech startup.
techcrunch.com
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Esme Learning Solutions Raises $15 Million
Esme Learning Solutions, a global online professional development provider, raised $15 million in new funding to support the EdTech Company’s goal to expand its geography. The AI-based online learning platform has now raised $22.5 million. The $15 million in funding comes before a planned Series B round in early 2022.
globenewswire.com
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Authoritive Raises $5 Million
Authoritive, a startup that builds customized learning experiences over messaging technology for experts and creators, raised $5 million in seed funding. The round was led by Owl Ventures, one of the largest EdTech venture firms in the world, who will take a board seat, and GMG Ventures. Launched in 2019, Authoritive allows creators to adapt their expertise to virtually coach people over messaging platforms including SMS, iMessage, WhatsApp, Slack, and MS Teams.
prnewswire.com
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Ivy Camps Receives Funding from MonCap and Man Capital
Ivy Camps USA, Inc., a global education technology company delivering live curated classes to children aged 6-18 taught exclusively by instructors from top U.S. universities, raised funding from MonCap and Man Capital. Founded by Danny Hundert, Ivy Camps reports teaching over 1 million student-hours of educational content that supplements school-based learning programs. Courses start at $149 for 5-session modules and some of the most popular offerings include public speaking, crypto for kids, video editing for YouTube, Engineer a Better World with the Stanford Design Cycle, and Writing for College Admissions.
prnewswire.com
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CHERRY TREE EDUCATION FOR-PROFIT 50 INDEX |
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For-profit education comprises more than 5% of the roughly $1.5 trillion that is spent on education in the U.S. annually. Cherry Tree created the Education For-Profit 50 Index representing a group of publicly traded for-profit education companies. |
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The For-Profit Education 50 Index consists of companies in the Pre-K-12, Postsecondary Education, Training and Development, and Education Products and Services segments for-profit education industry. |
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While there is plenty to be optimistic for in 2022, we’ll leave that discussion to next month’s commentary and instead focus on the year that was. It was a mixed bag, at best.
If we look at our predictions earlier this year, they were also a mixed bag. Our prediction that budget pressures would hurt K-12 schools was way off, as the government continued its effort to provide “short-term” relief with a torrent of federal stimulus, which continued even after the economy (and state budgets) bounced back and unemployment rates dropped. (Which reminds us of one of our favorite Tweets from the estimable @ThomasSowell: It is easy to be wrong, and to be persistent in being wrong, when the costs of being wrong are borne by others.) Our prediction that it would exacerbate the gap between the haves and have-nots proved more accurate but for different reasons, as the new administration decided for much of the year not to follow through on its promise to fully reopen schools with in-person learning. The loss in learning and the impact on the social and emotional health of many students is a tragedy that may only become clear years from now. Our predictions about higher ed have in some ways come true, in that the pandemic has accelerated a degree of upheaval in that sector. Many post-secondary institutions are seeing dramatic decreases in enrollment, straining budgets and forcing hard choices. Where we may have been overly optimistic was in our prediction that this upheaval would cause leaders to rethink their approach, and to take this as an opportunity to reimagine higher-ed. While some no doubt are doing this, the initial responses are uneven at best.
There was good news this past year, and there was hardship. In the capital markets as they pertain to companies involved in education, the economy has in many respects bounced back, M&A and venture financing activity are robust, valuations remain fairly strong, and at least in K-12 budgets are strong. And in a time when there is plenty of bad news we all deal with personally and societally each day, we remain optimistic about our shared future. More on that, next month.
For a confidential discussion about your company’s strategic alternatives for exiting, merging, acquiring, or obtaining venture financing, and how trends in education affect your prospects, please contact us at 952-893-9012.
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Prepared by:
Chad Johnson, Managing Partner
Follow me on Twitter @ChadEricJohnson
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Cherry Tree & Associates is a private investment banking firm headquartered in Minneapolis. Our firm specializes in serving middle market companies and their owners, whether private, public, or divisions of larger corporations. |
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Important Disclosures
The information included in this publication has been obtained from public sources, and is not based upon private or confidential Cherry Tree information. Cherry Tree gathers its data from sources it considers reliable. However, it does not guarantee the accuracy or completeness of the information provided within this publication. Any opinions presented reflect the current judgment of the authors and are subject to change. Cherry Tree makes no warranties, expressed or implied, regarding the accuracy of this information or any opinions expressed by the authors. Officers, directors, partners of Cherry Tree and Cherry Tree proprietary investment funds may have positions in the securities of the companies discussed, and certain affiliates of Cherry Tree may recommend to specific clients the purchase and sale of securities discussed in the publication. This publication does not constitute a recommendation with respect to the securities of any company discussed herein, and it should not be construed as such. Cherry Tree or its affiliates may from time to time provide investment banking or related services to these companies. Like all Cherry Tree employees, the authors of this publication receive compensation that is affected by overall firm profitability. We undertake no obligation to update any information in this publication.
The Education For-Profit (EFP) 50 Index is a hypothetical index, and does not reflect an actual investment portfolio. Comparisons between the EFP 50 Index and the S&P 500 are for illustrative purposes only. Correlations in performance information for the EFP 50 Index and the S&P 500 should not be relied upon as indicative of risks involved in owning or holding a portfolio of securities similar to the EFP 50 Index. Past performance should not be relied upon as indicative of future performance.
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