Weld North Education Sells Group of Ed-Tech Assets for Nearly $1 Billion
The value of digital curriculum and analytics came into sharp focus today with the announcement of a huge sale of portions of Weld North Education to a private equity firm specializing in tech investments.
Silver Lake purchased a majority stake in Weld North, the digital education technology company focused on developing digital curriculum and tools for pre-K-12 digital curriculum, from KKR & Co.
Although terms of the transaction were not disclosed, sources put the size of the deal at between $925 million and $950 million. The acquisition included the three Weld North Education K-12 digital curriculum companies—Edgenuity, Generation Ready, and Imagine Learning.
Together, these three businesses sell products to more than 3,000 school districts in the U.S., according to Jonathan Grayer, the CEO and chairman for Weld North, which he founded in a partnership with KKR & Co., a global investment firm, in 2010.
Weld North’s acquisitions began with e2020 in July 2011, which later became Edgenuity, a company that provides K-12 online and blended learning solutions. Weld North added Imagine Learning in 2014, a business that develops animation-driven digital language and literacy software to help elementary students learn English. The company has continued to grow by acquisition. Besides operating educational businesses, the company makes investments in companies that it deems to have high potential in the education industry.
The ownership change will provide Weld North with a new avenue for growth, said Grayer in a phone interview. Grayer, who launched Weld North after leaving as CEO of the education company Kaplan in 2008, will continue to lead Weld North after the sale.
“Silver Lake specializes in scaling technology,” he said. “They have been having trouble finding assets big enough in the digital education space to deploy their best services and expertise.”
This is the first foray into educational technology for Silver Lake, which has $39 billion in combined assets under management and committed capital. Its investment portfolio includes large, high-profile companies: Alibaba Group, Ancestry, Dell Technologies, GoDaddy, SolarWinds, and Symantec, among many others. Together, these technology and technology-enabled businesses generate more than $140 billion annually, according to the announcement of the new partnership.
The change of ownership is an interesting one to Adam Newman, the managing partner of Tyton Partners, a firm that provides investment banking and strategy consulting services for clients in education markets. He said Silver Lake will “bring a perspective and level of engagement that’s really beneficial” to Weld North. Newman said there are opportunities for the partnership with Silver Lake to “unlock” consumer and global markets with some of Weld North’s existing offerings.
Weld North LLC’s other companies—Performance Matters, which provides professional development for teachers and student assessment data, and Learning House, which serves higher education–are not included in the Silver Lake transaction. Neither is Intellify Learning, a learning data management and analytics solutions company.
Grayer said Weld North’s properties represent “the largest pure digital” curriculum company in the U.S., and “we want to build it into the largest education company in the United States.”
The opportunities in digital curriculum today are related to “how it’s being implemented, the infrastructure in schools, and the power of cloud-based technology that’s allowing for outcomes that weren’t possible before,” Grayer said.
For administrators in districts, Grayer said they “should be buying products that work,'” and the availability of data to determine what works enables that kind of decisionmaking.
“The bottom line is that digital curriculum has the ability to enable educators to spend less money” than they do on print products, said Grayer.
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