The acquisition brings together companies with well-known products in their respective spaces — Instructure’s learning management platform Canvas and Parchment’s credentialing solutions.
Instructure sees flexible, lifelong learning options that focus on upskilling, credentialing, and ongoing professional development as critical to its strategic growth, the company said in announcing the deal.
Parchment’s platform, one of the largest in the space, seeks to digitize the process of issuing transcripts, diplomas, certificates, and other learning credentials to make it easier for students to transfer credits and transition between institutions. The company, based in Scottsdale, Ariz., was founded in 2003 and says it has more than 15,000 customers.
Parchment is anticipated to add about $115 million to Instructure’s balance sheets in 2024. With an expected tax benefit from the transaction, the net purchase price is expected to be about $795 million.
During Instructure’s third quarter earnings call Monday, CEO Steve Daly said the company expects that buying Parchment will “bring Instructure important relationships with new buyers in our traditional customer base, a significant expansion of our total addressable market, and a high quality revenue stream with meaningful and profitable organic growth opportunities.”
The deal follows a string of acquisitions Instructure has made in recent years, including ed-tech management tool LearnPlatform in December 2022. Daly said the company’s “strong track record of successfully integrating acquired companies” gives them confidence they’ll “execute similarly with Parchment.”
Instructure also reported a net loss of $5.5 million for the quarter, an improvement from the $10.1 million loss it reported in Q3 2022. Revenues came in at $134.9 million for the quarter, a 10.2 percent increase year-over-year. Adjusted earnings before interest, taxes, depreciation, and amortization rose 22 percent from the prior year period to $58.2 million.
Shares in Instructure are trading at $25.18 Tuesday morning, up more than 3.7 percent from closing Monday.
Terms of the deal were not disclosed.
Vector Solutions, based in Tampa, Florida, provides training and workforce management software for a range of industries, including K-12, higher education, public safety, and construction.
The company said its acquisition of PATHWAYos will help support its career and technical education offerings and provide the foundation for a new CTE business unit. Vector said it’s also aiming to leverage the PATHWAYos platform in the future to connect businesses with skilled workers.
“Our acquisition of PATHWAYos reaffirms our commitment to helping students excel on their chosen career paths,” Jonathan Cherins, Vector CEO, said in a statement. “The combined power of our offerings will serve to bridge the skills gap between students seeking more training and work-based learning opportunities and industry customers looking to build a skilled workforce.”
PATHWAYos was founded in Denver in 2017 as Transeo and rebranded to PATHWAYos in July. The rebranding was aimed at reflecting the company’s updated platform and focus on connecting students to career pathways.
“Joining forces with Vector Solutions catapults us to an ambitious new era, where we can serve as an unrivaled catalyst for career and technical education,” said Cecilia Retelle Zywicki, CEO of PATHWAYos. The organizations are focused on “empowering students at scale by unlocking paths towards the future they want, and granting access to economic mobility that often is reserved for an exclusive subset of students.”
The startup’s backers include Philadelphia-based Osage Venture Partners, which led the company’s $4 million seed round in 2021.
Edge Tutor Raises Undisclosed Seed Round. Singapore-based Edge Tutor International raised an undisclosed amount of funding in a seed round, the company announced.
The round was led by MV Partners and Seaborne Capital, with additional participation by Kaya Founders, Ideaspace, Orvel Ventures, Lorinet Foundation, PayMongo CEO Jojo Malolos, Kalibrr CEO Paul Rivera, and Foxmont Capital Partners co-founder Mark Kooijman.
Edge Tutor was spun out from Philippines-based tutoring company Edukasyon.ph in 2023 to offer other tutoring businesses in the Americas, Europe, and Asia-Pacific region the ability to outsource the hiring, training, and management of online tutors. Edge says it provides access to certified and licensed teachers based in the Philippines.
The new capital raise will go toward growing its presence in its existing international markets, expand operations, and invest in its product offerings.
“We are thrilled about the rapid growth of Edge Tutor and remain intensely focused on scaling up with both existing and new clients, reinforcing tutor operations, and aiming for profitability by the next year,” said Henry Motte-de la Motte, CEO and founder of Edge Tutor.
In announcing the seed round, Edge also said it named Cecilia Calvo as chief operating officer.
In announcing the completion of the acquisition, Discovery also said former DreamBox Learning CEO Jessie Woolley-Wilson was stepping down from the chief executive role and will join Discovery’s board of directors.
Terms of the deal were not disclosed.
The acquisition, first announced in August, involves companies that collectively reach millions of students across core academic subjects, at a time when school districts are intensely focused on rebuilding students’ academic skills from the lingering, severe damage caused by the pandemic.
Discovery Education, which is backed by Clearlake Capital Group L.P., delivers curriculum, multimedia resources, and other materials in science, math, social studies, coding, and other subjects. DreamBox Learning’s major focus is on bringing adaptive learning resources in reading and math to schools.
Discovery CEO Jeremy Cowdry told EdWeek Market Brief in September that the company was looking for a partner to help it reach students on an individual level and personalize Discovery’s content and curriculum offerings to their specific learning needs.
At the same time, DreamBox was in search of way to expand its reach globally and respond to growing trends in the K-12 sector, including the coming dropoff of federal stimulus funding, Woolley-Wilson said.
While DreamBox and Discovery are now one company, DreamBox’s product will retain its current branding.
Image by Getty.
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