EDTECH - CLEARWATER INTERNATIONAL
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Summer 2019
EdTech
Educational institutions and private
providers are embracing the benefits
that technology can bring, both to the
learning environment and to the
efficiencies of their organisations.
Inside:
Market developments
How technology is transforming
sub-sectors including:
Schools
Corporate training
Higher education
clearwaterinternational.com
Increasing efficiencies
Market developments million pupils in state funded schools,
a number which is forecast to rise to
M&A activity in this market has been
strong with a number of trade and
Although the current adoption of nearly 8 million in the next five years. private equity deals in recent years. In
technology across the education Meanwhile school spending per pupil January 2019 Firefly Learning, the
sector falls far short of its full potential, has declined by approximately £500 school learning platform, completed its
the rate of growth is accelerating as per pupil since a peak in 2010-11 for latest investment round and has now
educational institutions and private both primary and secondary. secured more than €11.1m (£10m) of
providers embrace the benefits that Compounding this is that teacher capital from Downing Ventures, BGF,
technology can bring, both to the numbers are currently at their lowest and Beringea.
learning environment and to the level since 2013. Horizon Capital also recently
efficiency of their organisation.
Therefore, technologies that enable completed the acquisition of EES for
As a consequence, the fragmented teachers and schools to operate more Schools for an undisclosed sum. The
EdTech market is growing at pace, efficiently are particularly well transaction included Target Tracker,
with some bullish analysts forecasting positioned. However, the perennial the software solution used by over
global growth to 2022 of over 18% challenge with the market is often long 4,000 primary schools to track pupil
CAGR1. Successful smaller operators sales lead times within the schools progress. Clearwater International
within the sector are transitioning from themselves, meaning the rate of advised Horizon Capital on raising
early stage ventures to profitable change is slow. debt to support the acquisition.
businesses of scale which, in turn, is
One company managing to scale at an
attracting interest from private equity
impressive rate is Twinkl, the
who are looking to back teams to
educational resources business
deliver the next phase of growth.
boasting more than half a million
Certain mega trends within sub- pieces of content for primary and
sectors are inviting technological secondary school teachers and other
solutions to structural issues. learning professionals. raised debt finance from
Schools Its subscription based service for
either individuals or schools is now
The considerable challenges faced by to support the
supporting more than 4 million acquisition of
UK primary and secondary schools in educators around the globe. Twinkl’s
recent years are set to continue for the resources improve teacher efficiency
foreseeable future. Pupil numbers are and ensure high quality learning, Acquisition finance
rising, funding pressures remain, and providing an effective solution to Undisclosed
teacher shortages continue. As it challenges faced by the sector.
stands today there are currently 7.6
Number of pupils in UK state funded schools This is an exciting
9.0 time in UK education
8.0 with a clear
opportunity to
Number of pupils (million)
7.0
6.0 consolidate software
5.0 and services to reduce
4.0 workloads and simply
3.0 let teachers teach.
2.0
Gavin Freed, Executive
1.0
Chairman, Juniper Education
0.0 Holdings Ltd
Nursery and primary Secondary
Source: www.gov.uk
Clearwater International EdTech
Blended approach
Corporate training Given these positive drivers, private
equity and strategic buyers have
These Generation Z learners are very
demanding in terms of a technology
Demand for e-learning within the shown strong interest in the sector. A supported approach to education and
workplace is being driven by a recent example of such interest is acquiring the skills needed for a
fundamental shift in attitudes to Mindtools, the provider of online successful career.
continued education from employees, content for leadership and personal A recent survey showed while over
and a recognition by employers that effectiveness to both B2C and B2B 81% of university students felt digital
there are more effective learning customers, that was acquired by skills will be important for their future
routes than the out-of-date classroom- Emerald Publishing in April 2019. This roles, only half believe that their
based approach. transaction is also an interesting courses adequately prepare them2.
Innovative technologies, the increased example of publishers looking to gain
a technology platform to deliver Institutions are responding through
take-up of bring your own devices
content through an online subscription increased investment in the
(BYOD), alongside the more flexible
model. infrastructure and systems to deliver
nature of employment, drives demand
an active learning environment to
for a more effective way of continued
learning.
Higher education attract students to their universities, as
well as investment in distance learning
While traditional classroom-based Increasing tuition fees in 2012 to
capabilities and full online provision.
learning methods will always have a £9,000 had a short term impact on
undergraduate applications for FutureLearn, the digital learning and
place in the world of employment,
universities, however the decline online degree platform established by
these are often not flexible enough to
proved a temporary bump in the road The Open University, successfully
meet the needs of busy professionals.
and overall first time undergraduate raised £50m in April 2019 from
Often led by the ever-increasing
degree student numbers have Australia based SEEK group in the
number of millennials in the
remained buoyant since that time. In latest transaction in the sector.
workplace, employees are now
demanding learning ‘on the go’ to be 2017/18 there were 1.62 million
1: Research and Markets: Growth
consumed as, and when, they want undergraduates undertaking their first Opportunities in the Education Technology
across a full range of media, and on a degree in the UK. Market - Forecast to 2022
2: Jisc - Student digital experience
device to suit. As such, there is a Unsurprisingly however, this has led to tracker 2017: the voice of
continuing shift to a blended approach, an increase in expectations from 22,000 UK learners
combining e-learning and classroom students in terms of the quality of the
teaching, where employees are taking education they receive, the skills
ownership of their personal and developed, and the way in which they
professional development. are taught.
It has been demonstrated in recent
surveys that investment in UK Higher Education student numbers
technologies that support learning
1.8
within the workplace has a positive
impact on talent acquisition and 1.6
retention. In today’s tight labour
market, with employees taking 1.4
ownership of career development,
Number of students (millions)
businesses are increasingly seeing a 1.2
technology enabled learning
environment delivering technical and 1.0
soft skills as an essential offering.
0.8
Generally speaking, a holistic e-
learning system can be significantly 0.6
more cost effective compared to
traditional methods too. Therefore, 0.4
given these compelling drivers more
and more companies are deploying 0.2
technology as part of their human
0.0
capital and learning & development 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16 16/17 17/18
strategy.
Undergraduate first degree population UCAS Acceptances UCAS Applicants
Source: HESA
Clearwater International EdTech
Sector outlook
There are a plethora of growing businesses with exciting technology that are capitalising on the market opportunity with Virtual
Reality, Augmented Reality, adaptive learning and Artificial Intelligence likely to play an ever more important role in the coming
decade.
In addition to the sectors above, there are many more segments of the education market where technology will have a seismic
impact such as tutoring, language tuition and within vocational delivery. The direction of travel is one way, and as such we expect
M&A activity in the EdTech market to remain strong for the foreseeable future with interest coming from both private equity and
strategic trade.
Recent transactions
raised debt finance from
sold to sold to secured investment from
to support the
acquisition of
Acquisition finance Sell-side Sell-side Fundraising
UK Team
Marcus Archer Carl Houghton
Partner and International Head of Partner and International Head of
Business Services TMT
Tel: +44 845 052 0379 Tel: +44 845 052 0344
Email: marcus.archer@cwicf.com Email: carl.houghton@cwicf.com
Rob Burden Mark Maunsell
Partner, Business Services Director, Business Services
Tel: +44 845 052 0389 Tel: +44 845 052 0352
Email: rob.burden@cwicf.com Email: mark.maunsell@cwicf.com
clearwaterinternational.com China - Denmark - France - Germany - Ireland - Portugal - Spain - UK - US
You can also read
