K-12 Dealmaking: Kahoot! Makes Two Acquisitions, Labster Raises $21 Million

Contributing Writer

In recent dealmaking news, Oslo-based learning platform Kahoot! has acquired two companies that offer game-based instruction—DragonBox math apps and Poio, a game for learning to read that will be released in English this June.

Additionally, Labster has raised $21 million in a Series B funding round; Scholastic has purchased a majority stake in UK children’s publisher Make Believe Ideas Limited; the College Board has partnered with MetaMetrics to link test scores and assessments; and the Wah Fu Education Group has raised nearly $6 million in an initial public offering.

Kahoot! acquires DragonBox and Poio to boost math, reading through games

The game-based learning platform Kahoot! has made two acquisitions that the Oslo-based company believes will position it as a leading learning platform worldwide, helping millions of students from K-12 and beyond embrace math and reading education in a fun way.

In the area of math education, Kahoot! acquired DragonBox, a game-based learning studio and maker of the DragonBox family of math apps. Nordic-based DragonBox launched its first algebra game app in 2012 and the DragonBox school math curriculum in 2017. The program has millions of users worldwide, the company said.

“DragonBox brings tremendous value to our global community of students, teachers, and parents, as math is the single most popular subject on our platform.” said Åsmund Furuseth, CEO and co-founder of Kahoot!.

Also in the last week, Kahoot! announced it would acquire Poio, a game-based learn-to-read app that helps children tackle reading through play.

Poio was founded in 2016 by teacher Daniel Senn to help his son, who has severe hearing loss, master reading. The goal of the game is to help a troll, named Poio, learn how to read a storybook he has stolen from a group of letter bugs, called Readlings. Letters, words and a story are introduced by the characters as the children work to master reading at their own pace through play and exploration.

Since being launched, Oslo-based Poio has helped more than 100,000 children in Norway and Sweden learn to read, according to the company. Next month, the company will launch an English edition that will be available worldwide through the Kahoot! platform.

“There is only one goal for Poio, and that is to help as many children as possible to crack the reading code through play,” said Senn, CEO and founder of Poio. “By teaming up with Kahoot!, we will be able to launch Poio in more languages and with new functionality.”

The transaction with Poio is based on Kahoot! acquiring 100 percent of the shares in Poio AS for a total consideration of about $6.5 million on a cash and debt-free basis. The deal will be settled by a combination of cash and new Kahoot! shares at a subscription price of 25 Norwegian Krone, or about $2.86 per share. The transaction is expected to be completed by the end of June.

Launched in 2013, Kahoot! offers a mobile app and web-based quizzes. It was offered for free for the first five years. According to the company, it has been used by more than 1 billion users in 200 countries, including half of all U.S. K-12 students.

The company was chosen in 2017 for the Disney Accelerator Program, which came with a $10 million initial investment, boosting its Series A financing. Disney later acquired a 4 percent stake in the company. Last year, Kahoot! began charging for premium accounts and launched the Ignite accelerator program. The addition of DragonBox and Poio further the company’s collection of premium learning experiences as it seeks to increase its number of paid users.

Labster raises $21 million in Series B funding round

 The Copenhagen-based virtual lab company Labster has raised $21 million in a Series B round, which it plans to use toward content development and expanding into the U.S. market.

Labster, founded in 2012, allows students to conduct lab assignments in the digital version of a science lab, working through real-life case stories, interacting with lab equipment, performing experiments and learning with theory and quiz questions. The labs offer students a true-to-life lab experience at a fraction of the cost of a real lab, the company says.

“Labster is making STEM education more easily accessible and engaging for students around the globe by providing unique, interactive experiences in laboratory environments that are typically inaccessible to most people,” said Michael Bodekaer, Labster co-founder about Labster’s vision for science education. “This funding will enable us to develop new simulations and content from a wide range of STEM fields, creating more opportunities for students to learn, experiment and explore.”

Labster serves classrooms in more than 150 institutions, although most of its clients are in the U.S. Last year, it debuted an online biology program built with Arizona State University, Lenovo and Google.

The Series B round was led by Owl Ventures, with Balderton Capital, Northzone and Swisscom Ventures participating and Nordic Makers, David Helgason, EduCapital and Entangled Group making follow-on investments.

Labster raised $525,000 in seed funding in 2012 and $10 million in a Series A fundraising round in 2017, led by Balderton.

Scholastic completes purchase of majority stake in UK children’s publisher

Scholastic UK Limited, a wholly-owned subsidiary of Scholastic Corporation, the global children’s publishing, education, and media company, has acquired a majority ownership position in Make Believe Ideas Limited, an innovative UK-based publisher of children’s books.

Make Believe Ideas (MBI) was founded by Jo Bicknell in 2004. It currently publishes more than 100 titles a year and is known for creating high-quality, affordable books for young children and babies, which it distributes in the United States and around the world mostly through mass merchants.

Bicknell will retain an ownership stake in the company, remain on the MBI board of directors and continue to serve as its CEO. Financial terms of the transaction were not disclosed.

“Jo and the MBI team have been extraordinary partners on this journey. In less than four years, our collaboration has produced a bestselling Scholastic-branded line of books for early childhood with beautiful, inventive elements that invite kids to touch, play, discover and learn,” said Ellie Berger, Scholastic executive vice president, and president, Trade Publishing. “We look forward to expanding our publishing program to engage and inspire even more children.”

The acquisition comes after Scholastic announced its initial minority equity stake in MBI in 2015. The first co-branded offering from the two companies was the global English-language release of Scholastic Early Learners, a set of brightly colored, interactive books that encourage activity-based learning in multiple formats.

“The first four years of partnership with Scholastic have been full of hugely innovative books, delicious opportunities, and enormous fun,” said Bicknell. “I could not be more passionate about what the coalition of MBI and Scholastic will continue to achieve.”

College Board partners with MetaMetrics to link scores and assessments  

MetaMetrics and College Board are partnering up to link SAT and PSAT-related assessments to the Lexile Framework for Reading and the Quantile Framework for Mathematics, starting with the Spring 2020 test.

The Lexile and Quantile frameworks put student and instructional material on the same scale to match them with reading and math resources at each student’s ability level. This allows their test scores to become actionable, allowing assessment to be linked to instruction.

“Our partnership with MetaMetrics furthers our efforts to ensure that the SAT and PSAT-related assessments provide students and educators with the information and opportunities to clear a path for students’ college and career success,” said Todd Huston, senior vice president, state and district partnerships at the College Board, a not-for-profit organization.

More than 2.1 million students in the class of 2018 took the redesigned SAT, an increase of 25 percent over the previous class, according to the SAT Suite of Assessments Annual Report. Some 4.3 million students took the PSAT/NMSQT or PSAT 10 last year.

The SAT Suite of Assessments allows educators and students nationwide to monitor progress of students over time and help them prepare for college.

“Over the last decade, the number of states, publishers and ed-tech companies that have linked their assessments and solutions to Lexile and Quantile measures has increased exponentially,” said Malbert Smith, CEO and co-founder of MetaMetrics. “As a next step in that continued growth, we are proud to collaborate with College Board to provide our instructional link to their SAT Suite of Assessments.”

Wah Fu Education Group raises nearly $6 million in IPO

Wah Fu Education Group Limited, a Beijing-based provider of online training and exam preparation services, as well as related training materials and technology solutions for both institutions and individuals, closed its initial public offering at about $5.9 million before deducting expenses.

Wah Fu Education Group plans to use the proceeds to establish U.S. operations, for product development, technology research and development, and to establish branches in China, advertising and marketing, strategic reserve and working capital.

The amount raised includes 1,181,033 ordinary shares at a public offering price of $5 per share. Network 1 Financial Securities, Inc. acted as the underwriter in the offering. Ellenoff Grossman & Schole LLP acted as U.S. legal counsel to the company, and Mei & Mark LLP acted as legal counsel to the underwriters.

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