Inside the Deal: Why Discovery Education Bought DreamBox Learning
When Jeremy Cowdrey joined Discovery Education as CEO six months ago, he was confident in the company’s ability to deliver high-quality content and curriculum, both core and supplemental, in a whole-group setting.
At the same time, he also knew the company didn’t have the ability to reach students at an individual level and personalize that content, especially when it came to ELA and math materials.
That need drove Discovery — which delivers curriculum, multimedia resources, and other materials in science, math, social studies, coding, and other subjects — to find a partner that did. The company announced this week that it had agreed to acquire DreamBox Learning, one of the largest providers of supplemental online math and reading products in the country.
Terms of the deal, which is expected to close in the beginning of Q4, were not disclosed.
“Prior to me even joining Discovery Education, it’s been the hope that we would be able to find that partner, and DreamBox has always been one of the top partnership opportunities that we hoped for,” Cowdrey said.
“This is such a complimentary way for us to go forward together with two very high-quality brands that are respected in the industry, that have been doing two very different things.”
Similarly, DreamBox CEO Jessie Woolley-Wilson had been looking for the right partner for the organization as it sought to scale its solutions and reach a much larger range of students.
Discovery wasn’t the first potential acquirer DreamBox considered, she said, but it was the one that stood out the most as having built trust with educators, something that she said has eroded between schools and vendors in the wake of the pandemic. Being a part of Discovery Education was a way to further build on the reputation of both companies in the K-12 market.
“We’ve always known that we wanted to serve more students and be a part of a bigger platform, but we’ve been saying “No” to a lot of people because we wanted to be able to amplify the trust,” Woolley-Wilson said.
‘Cultures of Purpose and Passion’
Amid waning federal stimulus funding and a need to rebuild students’ academic skills, districts are looking hard at which products deliver results in an effort to decide which to keep and which to cut. Being able to provide a range of products is one way to provide districts with the solutions they’re looking for, she said.
“Part of this combination is in response to some new trends in the K-12 sector, and this is going to position Discovery and Dreambox as the best solution that can provide both core and supplemental solutions,” she said.
Another factor Woolley-Wilson considered in agreeing to the deal was Discovery Education’s scale on a national as well as international level, she said. Discovery serves more than 4 million educators and 45 million students globally. DreamBox says it is used by 600,000 educators and more than 6 million students.
While DreamBox and Discovery, which is backed by Clearlake Capital Group L.P., will become one company under Discovery once the deal closes, DreamBox’s product will retain its current branding, Cowdrey said.
DreamBox Learning’s current investors, Elliott Investment Management L.P. and TPG’s The Rise Fund, will retain minority stakes in the company.
Details about how the companies will come together logistically are still being worked out ahead of closing, Cowdrey said, adding that he and Woolley-Wilson will work together to assess the best choices moving forward.
“We’re not going to make impulsive decisions, we’re going to make sure that we respect and honor and chose what’s right, rather than what’s easy,” he said.
The deal follows other recent acquisitions by Discovery: Pivot Interactives and DoodleLearning were acquired in August of 2022, and Mystery Science was snapped up in 2020.
Both CEOs said they are convinced that the companies’ cultures mesh well together.
“With any integration of two fairly sizable organizations, there’s change or evolution,” Woolley-Wilson said. “But there’s one consistent thing that we’re really excited about, which is our cultures of purpose and passion are matched.”
She also stressed that the acquisition “will in no way diminish” the companies’ commitment to diversity in education, amid the national debates over the topic that have made people “very uneasy about how diversity is managed,” she said.
To her, diversity shouldn’t be managed — it should be “leveraged for the common good.”
The best way to do so “is to make sure every individual realizes their learning and living potential,” she said. “This combination is going to mean that more kids are going to have access to the best learning experiences, and what that means is that we’re going to unlock their learning potential, and in doing so, unleash their human capabilities for the greater good.”
Image by Getty.
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