Chinese online English school 51Talk has raised a $55 million Series C led by Sequoia Capital with participation of existing investors Shunwei Capital and DCM. The round brings the total funding raised by 51Talk to over $70 million including a $12 million Series B in December of last year.
In today’s EdTech Startups Japan Edition we take a look at three startups that are based in Japan, two of which founded by immigrant entrepreneurs from the US.
Translation platform Gengo surpassed 200 million translated words, Eigooo wants to teach English via text chat to shy students and Mana.bo wants to disrupt the $10 billion Japanese cram school industry.
Eleutian Technology, an online English teaching service provider, sold part of its business to Nagase USA for an undisclosed amount.
As part of the transaction, Nagase USA is hiring 40 Wyoming teachers and 10 teacher trainers and managers from Eleutian and Kent Holiday, founder and former CEO of Eleutian, has taken the role of a senior executive at Nagase USA. Craig Holiday, Eleutian’s current CEO, will become Eleutian’s president.
TutorGroup, an online English language learning platform raised a $100 million Series B with participation from Alibaba Group, Singapore investment company Temasek and Qiming Venture Partners.
Are the days of high priced language learning software over? With Rosetta Stone’s latest acquisition it surely looks as if one of the leading companies in that sector is looking for greener meadows.
The $22.5 million all cash acquisition of Lexia Learning reported by the Wall Street Journal is one indicator that language learning isn’t enough to survive in the long term; the quote
“We are evolving the company from a language company to a learning company,”
by Rosetta Stone’s CEO Steve Swad a second one.
Also, customers already are under the false impression that Rosetta Stone is offering far more learning products than just languages. According to the WSJ a survey showed that people already relate RS to math, reading and music products. Swad stated “To me, it’s just evidence of brand permission to extend.”
Of course the acquisition of Lexia Learning also strengthens Rosetta Stone’s position in the K-12 and global English learning market yet we have to see it as part of a far broader strategy to transform Rosetta Stone into a learning company. From the press release
“This acquisition is another step in the transformation of Rosetta Stone,” said Swad. “We`re moving beyond language; we`re leveraging technology; we`re growing our business in new and meaningful ways. And we`re positioning this company to change the face of learning as we know it.”
I think it is pretty obvious to Swad and the team at Rosetta Stone that the days of high priced boxed (or downloadable) language software are numbered. The acquisition of Livemocha earlier this year and therefore the transition to a cloud based language learning portal was a first step here to compete with similar players like babbel.com and busuu.
All three offer language learning products at a fraction of the price customers need to pay for a Rosetta Stone product. Even the current half price offering Rosetta Stone is promoting on Facebook at $395 looks outlandishly expensive compared with the package prices Livemocha, babbel.com or busuu offer.
And we must not forget Duolingo that is slowly but surely becoming a real threat to the startups that aimed to disrupt Rosetta Stone. Duolingo already offers different languages and mobile applications at no cost to the learner. Duolingo also has studies that show the efficiency of its products and the startup is growing fast. Also, the reviews of people learning with the product I have read so far were fairly positive.
Therefore, it seems to be a good idea to find more lucrative niches as soon as possible. Other verticals are yet pretty much untouched from decreasing prices and Rosetta Stone’s brand and technology might enable the company to build up a new foothold there.