Cherry Tree & Associates | February 2021 | Volume XV, Issue 8 |
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Renaissance Learning to Acquire Nearpod for $650 Million
Renaissance Learning, the Minnesota-based assessment provider, will acquire Nearpod for $650 million. Nearpod offers an instructional platform that merges formative assessment and dynamic media for self-paced learning. Nearpod reports being used in 75% of US school districts serving up 19.5 million lessons in 2020.
businesswire.com
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Learning Technologies Group to Acquire getBridge
Learning Technologies Group (LON:LTG) has agreed to acquire getBridge, a learning and talent development software provider for roughly $50 million, or 2.4x its 2020 revenue of $21 million. Over 90% of its revenue is recurring annually based on multi-year contracts. Bridge, a subsidiary of Instructure, provides a learning management system in addition to performance, engagement and skills development products on SaaS-based platform.
proactiveinvestors.co.uk
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SchoolMint Acquires Whetstone Education
SchooMint, the enrollment management platform, acquired Whetstone, an observation and coaching platform. Whetstone reportedly serves over 1 million students and more than 2,000 schools. SchoolMint, which is backed by BV Investment Partners, reportedly serves over 10 million students across 16,000 schools.
businesswire.com
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Onex to Invest in Weld North Education
Weld North Education, which operates Edgenuity and Imagine Learning, received a strategic investment from Onex (TSX: ONEX), the Canadian private equity firm. Onex will join Weld North’s lead investor, Silver Lake, in backing the Company. The transaction is anticipated to close by the end of the first quarter subject to customary conditions and regulatory approvals.
globenewswire.com
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Brightwheel Raises $55 Million
Brightwheel, the early education platform, raised $55 million in a Series C round with participation from Emerson Collective, Next Play Ventures, GSV Capital and Bessemer Ventures among others. Brightwheel will use the latest funding to invest in new product development and expand its team across Austin, Denver, and San Francisco offices, as well as support a fully distributed workforce.
prweb.com
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Class Raises $30 Million
Class Technologies, the Zoom integrated classroom solution launched by Blackboard co-founder Michael Chasen, raised $30 million in a series A round led by Insight Partners and Owl Ventures. Formerly known as ClassEDU, the company was launched in the fall of 2020 and has raised $46 million to date. "Since our beta launch, there has been heavy demand for Class, which is built on Zoom, from the K-12, Higher Education, and corporate training markets both in the U.S. and overseas," said founder Michael Chasen.
prnewswire.com
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Volaris Group Acquires SoftChalk
Volaris Group, an investing arm of Constellation Software, acquired SoftChalk, the provider of education content authoring software. SoftChalk will be integrated into AssetWorks, a Volaris Group company. “Expanding the Volaris portfolio of higher education software firms creates even more opportunities to share best-practices and encourage talent development across teams,” said Trey Drake, Group Leader, Volaris Group.
globenewswire.com
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Kahoot! Acquires Whiteboard.fi
Kahoot!, game-based learning platform, acquired Whiteboard.fi, a whiteboard tool and formative assessment platform based in Finland. Launched in early 2020, Whiteboard.fi was valued at $6 million in a combination of cash and Kahoot! shares.
prnewswire.com
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SplashLearn Raises $18 Million
SplashLearn, which teaches children through a game-based curriculum, raised $18 million in a round led by Owl Ventures with participation from Accel. SplashLearn reportedly serves more than 40 million registered students on its platform, 10 million of whom joined last year as the coronavirus shut schools worldwide.
yahoo.com
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FourthRev Raises GBP 2.3 Million
Digital education start-up, FourthRev, based out of London, raised GBP 2.3 million in a seed round led by Reach Capital. The funds raised will primarily be used to develop FourthRev’s world-class online learning platform and to double the size of the global team, which is currently 35-strong, across the UK, Australia and the US.
fenews.co.uk
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Hobsons to Sell its Naviance & Intersect Businesses to PowerSchool…
PowerSchool, the K-12 education technology provider, will acquire Hobsons’ Naviance and Intersect solutions for $320 million. Naviance is a career readiness solution sold to schools to prepare students for life after high school, and Intersect is an admissions solution connecting students to education opportunities. PowerSchool reportedly serves over 45 million students across 80 countries.
prweb.com
…And its Starfish Business to EAB
Hobsons’ advising and engagement solution, Starfish, will be acquired by EAB for $90 million. EAB is a provider of advising, communication and enrollment technologies that is reportedly used by more than 1,900 higher education institutions. Interestingly, both PowerSchool and EAB are owned by private equity firm, Vista Equity Partners. This values the combined Hobsons platform at $410 million which is 3.4x its 2020 revenue of about $120 million.
edsurge.com
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IXL Learning to Acquire Wyzant
IXL Learning, the K-12 learning platform, has agreed to acquire Wyzant, the online tutoring marketplace. Wyzant reportedly offers a network of more than 65,000 tutors across a wide variety of academic fields, serving learners of all ages. IXL reports being used by 11 million students and by 95 of the top 100 school districts. The acquisition will be finalized during Q1 of 2021.
prnewswire.com
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Top Hat Raises $130 Million
Top Hat, the courseware platform for higher education, raised $130 million in a series E round led by existing investor Georgian. The latest round values the Company around $500 million as the Company reportedly grew 40% in 2020. Concurrent with the announcement, Top Hat founder and longtime CEO Mike Silagadze will be stepping down and his successor will be Joe Rohrlich, formerly the Chief Revenue Officer for Bazaarvoice.
businesswire.com
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Labster Raises $60 Million
Labster, the provider of virtual laboratory simulations, raised $60 million in series C funding led by Andreessen Horowitz. Existing investors GGV Capital, Owl Ventures, Balderon Capital and David Helgason participated. Labster reportedly supports over 2,000 universities and high schools and has raised over $100 million to date.
prnewswire.com
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CodeAcademy Raises $40 Million
CodeAcademy, the online coding education provider, raised $40 million in a series D round led by Owl Ventures with participation from Prosus and Union Square Ventures. CodeAcademy reports having over 5 million new users in 2020 and over 150 thousand paid subscribers. The funds are intended to accelerate growth in both its consumer and B2B products.
prnewswire.com
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Colibri Group Acquires BrightPath Education
Colibri Group, the provider of learning solutions for licensed professionals, acquired BrightPath Education, a provider of qualifying and continuing education for appraisal and real estate. The company also offers online courses through its partnerships with Hondros Education Group and Superior School of Real Estate, which are both part of Colibri Group. Colibri Group is backed by private-equity firm Gridiron Capital.
businesswire.com
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Teachers of Tomorrow Acquires The Learning Liaisons
Teachers of Tomorrow, the teacher certification provider, acquired The Learning Liaisons, an exam-prep platform for teachers. Teachers for Tomorrow, a portfolio company of Gauge Capital, reports helping more than 70,000 teachers get certified.
prnewswire.com
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Photomath Raises $23 Million
Photomath, the math learning app, raised $23 million in a series B round led by Menlo Ventures with participation from GSV Ventures, Learn Capital, Cherubic Ventures and Goodwater Capital. Photomath acts as a digital math tutor for students and reports having over 220 million downloads.
prnewswire.com
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Interplay Raises $18 Million
Interplay, a digital education platform focused on hands-on trades like plumbing and electrical work, raised $18 million in a series B round led by Owl Ventures and S3 Ventures. “Plumbing is just one of many good-paying skilled trades that remain in high demand but which have largely been glossed over by the education technology industry,” says Doug Donovan, co-founder and CEO of Interplay Learning.
edsurge.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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We wouldn’t exactly be breaking news to note that digital education solutions saw an explosion in downloads and usage last year. From an economic standpoint, what matters more is whether schools enjoyed and will continue using and paying for these programs. (To be clear, what matters even more is whether they help students, teachers, and administrators). But we have seen and think it is noteworthy to discuss two recent reports on which applications are emerging as leaders in the K-12 market.
The first report we saw was from our friends at MDR. If you don’t know who they are, and you need access to actionable data for use in marketing to schools, let us know and we’ll connect you. Their report, 2020 Year End Technology in the Classroom, is based on survey data and includes a helpful comparison to 2018 to show how the landscape has shifted. Zoom not surprisingly now leads their top five list of educational applications, followed by Kahoot!, Flipgrid, Bitmoji, and Quizlet, as opposed to the the 2018 top five which were Google Classroom, Kahoot!, Remind, Quizlet, and Khan Academy.
The second report was from our friends at Piper Sandler, possibly the second-best investment banking firm in Minnesota. Competitive ribbing aside, their report Digitization of Education: Our Report Card on TAM, Growth, App Data contains a wealth of information based on their analysis of proprietary mobile app data. They included a list of the Top Mobile Education Apps by platform (iOS vs Android), which showed that Canvas, Remind, Google Classroom, Flipgrid, and Photomath led for iOS, while Google Classroom, ClassDojo, Canvas, Remind, and Seesaw led for the Android platform.
There are scores of successful, popular, and very useful applications for the education market, and these lists provide just a glimpse, and just two snapshots, of who the leaders are today. As the market shifts to digital being a more sustained delivery method for educational resources, it bears watching to see which programs will emerge as the leaders in the K-12 market.
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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