Inside a Special Education Company’s $27 Million Fundraising Round
PresenceLearning, which provides live online special education therapy services for K-12 schools, recently received a major infusion of financial support—$27 million—in the form of a Series D investment led by Bain Capital Double Impact.
The pandemic accelerated the completion of the funding round, which will help the company’s expansion of online therapy and assessment services to meet growing school needs, said Kate Eberle Walker, CEO of PresenceLearning.
Other financial backers in the latest fundraising round are existing investors Catalyst Investors, New Markets Venture Partners, and Catamount Ventures.
Founded in 2009, PresenceLearning offers a proprietary platform for teletherapy and a network of more than 1,000 licensed clinicians who can provide services to students virtually. With massive school closures in March, districts were faced with how to deliver services usually provided in person for students who have individualized education plans (IEPs).
EdWeek Market Brief recently spoke with Walker, who has more than 20 years of experience in the education industry, about the future of the company, which was founded in 2009. Before joining PresenceLearning, Walker was CEO of The Princeton Review and Tutor.com. Previously, she led strategy and investments for Kaplan. She began her career as an investment banker at Goldman Sachs and received her MBA from Harvard Business School.
How long has this transaction been in the works? Was it underway pre-COVID-19, or as a direct result of the fallout from school closures?
It always feels like a long time coming, working on these transactions. I joined PresenceLearning in January 2019 and started building a new leadership team. I met with the Bain team in February 2019, and we continued talking as I built the team.
We started focusing on our capital needs in the fall. What changed with COVID is the urgency and confidence on all sides that now is the time. This expansion in the need for teletherapy is huge, and we didn’t want anything holding us back.
Did you offer teletherapy for free during this time?
For all of the school districts that we were already working with—that are using us for direct teletherapy, or teleassessment—we made it available for free. That’s 450 districts that are on our platform receiving services through PresenceLearning clinicians. Up until March, districts were purchasing services for speech assessments, cognitive assessments; they were having us cover a portion of their caseload, then having a school employee team handle the remainder of the caseload on-site.
How did schools’ shift to remote delivery of their own special education services affect your company?
Schools were recognizing that all the cases they had been serving on-site would now have to be served online. They wanted to have the continuity of the relationship between the therapist and the student, so we realized a better solution was for us to teach them how to use the platform and give it to them [school-based clinicians] to work on. It’s been a big success. It’s really helped them have the continuity and peace of mind for those already using PresenceLearning. They had someone helping show them the way.
What’s your plan for schools’ reopening in the fall?
They have largely been practicing different strategies and approaches. We’re going to continue into the coming school year as a paid product with training and the ability to license the platform and [for schools to] use it to deliver their services remotely. We also made those services available for purchase to schools we weren’t already working with.
How do you deliver services with your own network of providers?
We work with the [special education] director to look at their caseload, and usually 80 to 85 percent of students are eligible for teletherapy, especially speech therapy.
About five years ago we launched psychoeducational assessments, and that’s been very popular. It’s a straightforward element of their workload that they can turn over to us, whether it’s to reconfirm eligibility for services or to determine eligibility for services. Many schools will bring us in to do that.
What kind of efficacy studies have you done for your services?
We’ve done equivalency studies on the assessment side. We brought in NYU to validate the equivalency of online assessment. There’s plenty of research out there that others have done on the equivalence of speech therapy, in particular, in the online environment. The other way we’re measuring effectiveness is by focusing on progress against IEP goals, documenting, and reporting that out to schools. The other measure we look at reflects parent satisfaction more than anything. If parents are satisfied, you see a lower rate of due process claims. These are very rare in our service, and when schools do get them, we help them defend the claim
How are parents responding to at-home delivery of these services to their children?
About 15 percent of our clients are virtual schools. Those students are always in the home with the parent facilitator. That’s been tremendously helpful because we had that experience. Before school closures, you would have a paraprofessional in the school as a facilitator. We needed a sheet of clear instructions for parents on how to facilitate, and when not to actively participate. Mostly it’s about getting children set up on the screen, then if the parent can’t leave the room, they need to go to the back of the room. Relying on the parent as an aide required some parent letters, administration guidelines. It’s definitely different, but the therapy experience is essentially the same.
What does your professional development look like?
We have online, self-paced, visual-based training, basically a “teleinstitute” online. Part of that is how to think about adapting practice to the online environment and how to make the most of the PresenceLearning platform itself. It has all these features that were tested and designed by clinicians over the first 10 years of the company. There are more things that would help them be more effective online, such as multiple camera views. And if a student is distracted by their own view, how to make the most of all that.
We’re also running daily office hours for clinicians once they start using the platform in the first couple of weeks.
How do you plan to use your new infusion of capital?
The primary use of capital will be to build up our sales team. We still have a fairly small sales team—11 sales reps supported by an inside sales team of five individuals. The company started in California and a lot of our school-based customers continue to be in California, Washington state, and Oregon. What we’ve been wanting to do is to reach out nationally, but we haven’t been in a position to build up our team.
Priority No. 2 is to invest more in our state expertise. This work requires a lot of state-specific knowledge around teletherapy. around which portions of services can be covered by Medicaid. So we want to build up our state specialization capabilities with our own internal regulatory team to be knowledgeable. We want to participate in conversations about what’s happening now versus what could be done.
We feel we have a lot to offer those conversations about cross-licensing systems for states. Current regulations are not designed for an era where clinicians can serve online in different states. It’s similar to conversations in law, this question of, “Should there be a different license for every state or should there be more unity?”
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