Today we recorded episode nine of On the Ed with our friend Shiv Rajendran of Affectively. Once again, it has been a week full of stories of startups getting funded or raising more money, but we also saw a bigger number of mergers and acquisitions in education that will make an impact on the market in the years to come.
After our read through the news, we start in the show with Quora’s massive $80 million Series C. Somewhat related to the Quora story is Kuailexue that built a mobile Q&A site for high schoolers in China to help them pass the national college entrance exam. Although peer learning undoubtedly is valuable, questions here arise around the quality of the answers provided – something Quora, in comparison, has put a lot of emphasis on and effort into from the start as Shiv points out correctly.
Since our guest is based in London we also talk about a new initiative in the UK to stimulate the development of educational technology. The Small Business Research Competition helps fund projects with up to £80K over a period of six months. This is one of several initiatives with similar objectives in the UK, the question being how flat are hierarchies and how much paperwork is involved here.
Seeing more startups who attract funding also outside of the US and to a lesser degree Europe, we talk about edtech in India next. Over the past month we have covered a good handful of these Indian education startups, often in skills training, but also English language acquisition and STEM.
A recurring topic on On the Ed is the very different systems in the US and Europe when it comes to higher education, so naturally Quad Learning’s approach caught our eye.
The world needs more professional programmers, and The Flatiron School wants to provide these.
With Weld North and Eleutian we also have two interesting stories in the English learning and teaching vertical. The first is interesting because former Kaplan CEO Jonathan Grayer always makes material for a good story, the latter because Eleutian cracked the traditionally very difficult Japanese market (difficult for US and European companies that is).
Will sound-enhanced ebooks make an impact and help students read more and comprehend better? Booktrack think they know how to unlock a student’s potential and launched Booktrack Classroom.
Indian edtech startup Learning Edge Academy of Professionals (LEAP) has raised an undisclosed amount of angel funding from Sarthi Angel Venture Foundation (SAVF).
Founded in 2009 Learning Edge provides educational institutions like schools and colleges but also retail training centers with a mix of traditional and digital content. The startup conducts high-speed document imaging and automate data capture of content.
Mumbai-based financial services training provider EduPristine announced that it has completed a $1.5 million Series A round. The investment was raised from Accel Partners and divided into three tiers of $500k in 2011, 2012 and 2013.
Founded in 2007 EduPristine teaches university graduates the practical skills needed in professional life. Though the main business happens to take place in real classrooms, there is also an online offer for various courses.
Quad Learning, a platform that aims to help students to transition from community colleges to four-year institutions, raised a $10 million Series B.
Quad Learning’s core product American Honors is currently in place at five community colleges and helps students to transition into four-year colleges or universities with their Associate’s degree at the end of the program. Quad Learning calls this a “2+2” approach.
Kuailexue, a Chinese startup that builds a mobile Q&A platform for students around smartphones, raised a $5 million Series A.
Kuailexue is a peer learning platform that targets high school students, currently covering English for the national college entrance exam. Kuailexue’s mobile application for Android enables high school students to take photos of questions they are stuck with and post them to a community to get crowdsourced answers.
Booktrack, a startup that enhances ebooks by means of sound effects, music and ambient sound, raised a $3 million funding round.
Booktrack’s patented technology claims to be adaptive. Depending on how fast somebody reads a text the music, sound effects and ambient sound, which are all recorded separately, will match the reader’s speed.
New York startup Flatiron School raised a $5.5 million Series A for its coding courses that turn newcomers into professional programmers in just four months.
Flatiron School’s intensive courses take place in their classrooms in Brooklyn and Manhattan and are priced at $12,000 a course. With an acceptance rate of between 8%-10% only, Flatiron School states that with its help 98% of their students find paid work after finishing the program.
Questions and answers site Quora raised $80 million Series C. This new investment could be the last or may be sufficient for Quora to break even and eventually become profitable.
The company plans to stay independent, however not go public in the midterm.
Mergers & Acquisitions
Online learning company lynda.com announced the acquisition of Canadian startup Compilr, a software coding and development environment that allows people to learn, write, compile and test code from their browser.
Though terms of the acquisition have not been disclosed, TechCrunch estimates the purchase price at around $20 million according to sources.
Eleutian Technology, an online English teaching service provider, sold part of its business to Nagase USA for an undisclosed amount.
Nagase was Eleutian’s largest customer in Japan prior to the sale. The transaction will provide capital for the next phase of Eleutian’s business, expanding its operations in China, Korea, the Middle East and other international markets.
Weld North Holdings LLC announced today that it has acquired Imagine Learning and Truenorthlogic. Though terms of the deals have not been disclosed, New York Times Dealb%k wrote that the price was above $150 million for the two companies according to sources briefed on the matter.
Weld North is led by former Kaplan CEO Jonathan Grayer and aims to create a $200 million platform, providing digital learning solutions for English-language education as well as school management services.
UK-based Learning Technologies Group plc (LTG), parent company of Epic, announced the acquisition of LINE Communications for £9 million. £5.1m will be paid in cash and £3.9m in new LTG shares.
The acquisitions LINE is part of LTG’s “buy and build” strategy to create a global e-learning leader with in excess of £50m of revenue. Besides growing the business organically, LTG also plans to make further acquisitions in the future.
Pluralsight, a Salt Lake City-based online training platform for technology professionals, acquired Digital-Tutors, an online training platform for creative professionals for $45 million.
The acquisition adds over 1.500 courses to Pluralsight’s content library, bringing the total to over 3.000 courses. Clients of both companies have access to the entire course catalog from today on at no extra charge.
The Sindicato Nacional de Trabajadores de la Educación (SNTE) announced that it has selected Declara as technology platform to deliver training to 1.6 million teachers and administrators in Mexico.
The initiative is part of a larger plan to transform the entire Mexican education system over the next couple of years with teachers as the driving force behind reforms. In July Mexico will introduce a new national test in which teachers need to demonstrate their mastery of skills.
The Technology Strategy Board together with the Department for Business, Innovation and Skills launched a Small Business Research Initiative (SBRI) competition to further stimulate the development of education technology products in the UK.
Through this SBRI competition organisations can attract a 100% funded development contract of up to £80k (inclusive of VAT) and projects will last up to six months. The Technology Strategy Board and BIS are to invest a total of up to £1.1 million through the competition.
The International Finance Corporation (ICF) committed up to $20 million for a new Education Innovation Fund managed by Learn Capital. The fund will invest in early to mid-stage edtech companies focused on or located in emerging markets reports VCCircle.
IFC, the private sector lending arm of the World Bank group, comes in as an anchor LP through straight equity investment, the Education Innovation Fund targets a total of $100-150 million.