K-12 Dealmaking: Pearson Invests $50M to Support Education Entrepreneurs in Emerging Markets

By guest blogger Kevin Connors

One in 10 children around the world do not attend elementary school, says Pearson chief executive John Fallon. It’s a statistic he attributes to the dearth of affordable, high quality schools available in developing countries.K-12_Dealmaking.gif

Fallon and Pearson’s Affordable Learning Fund are trying to change that.

Launched in 2012 with $15 million of initial capital from Pearson, the fund invests in for-profit education entrepreneurs seeking to provide low-cost, high quality schools and services to low-income learners in Asia, Africa, and Latin America. Encouraged by the work of its current portfolio of companies, which includes ed-tech startups and many low-cost private schools, Pearson recently announced that it will invest another $50 million into the fund.

This recent injection of capital will not only be used to support its current partners in South Africa, Ghana, India, and the Philippines, but also to invest in new entrepreneurs, especially those in Latin America, a market the fund has yet to invest in. According to a recent statement, Pearson “expects to reach millions of additional students and young adults by 2020.”

The statement also notes that companies must demonstrate “improvements in learning outcomes and market-based returns” in order to receive reinvestment, though it is not clear exactly how outcomes are measured.

In addition to the $50 million investment in its fund, Pearson announced that it will be launching a new initiative called “Project Literacy” to improve global literacy rates for the nearly 800 million people who cannot read and write around the world. The initiative’s first partnerships are expected to be announced in the first half of 2015.

For more news on mergers, acquisitions, and venture capital in education, follow Marketplace K-12’s “K-12 Dealmaking” series. 

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