This article provides an overview of the publicly announced tech and coding bootcamp acquisitions since 2014.
This article includes the following sections
- Understanding the Bootcamp Market
- Valuing Coding & Cybersecurity Bootcamps
- 2022 Bootcamp Acquisitions
- 2021 Bootcamp Acquisitions
- 2020 Bootcamp Acquisitions
- Summary of Tech Bootcamp Acquisitions
- Notable Coding & Cybersecurity Bootcamp Acquisitions
Since the first coding bootcamp acquisition in June 2014, we’ve seen dozens of coding bootcamps get acquired by a wide range of companies, from for-profit education companies (like Capella Education) to co-working companies (like WeWork) and other coding bootcamps (like Thinkful + Bloc)!
With rapid market growth in the bootcamp industry, other types of for-profit education companies are taking note, including traditional vocational schools and 4-year colleges and universities.
Many of these coding bootcamp acquisitions should come as no surprise. Some have been very successful, with the programs going on to significantly increase the number of physical locations and online course offerings.
In addition, as coding bootcamps mature, we are beginning to see bootcamps get acquired by well-known companies for increasingly large sums. For example, General Assembly was acquired for $413 million, and Trilogy Education for $750 million!
As education industry specialists, Jackim Woods & Co maintains a list of bootcamps acquisitions to track who’s buying whom and how bootcamps and how edtech companies are valued. As we were compiling the 2022 transactions, it occurred to us that others might be interested in this information as well, so we thought we’d share it with you. We plan to update this list each year with publicly announced deals involving coding and cybersecurity bootcamps.
Understanding the Coding Bootcamp Market
If you are interested in learning more about the $2.3 billion tech bootcamp sector, please see our article Understanding the Tech Bootcamp Market.
Valuing Tech & Coding Bootcamps
If you’re interested in understanding how bootcamps are valued, please see our article How to Value a Bootcamp – Example and Multiples.
You might also enjoy reading our related article, How to Value an EdTech Company – Multiples & Example.
2022 Coding Bootcamp Acquisitions
2022 was a big year for tech boot camp dealmaking.
- 2022 started off with a bang when Skillsoft, an online course provider, acquired Codecademy in January for $525M.
- Then, in February, Centage Group acquired InfoSec, the leading provider of tech-related certification prep courses, for $190 million.
- The year also ended with two notable transactions when Digital Intelligence Systems acquired Grand Circus for an undisclosed amount, and Simplilearn (a Blackstone Group-backed company) acquired Fullstack Academy. Fullstack Academy was estimated to be valued at $55 million.
2021 Coding Bootcamp Acquisitions
- ThriveDX (HackerU) acquired Cybint for a reported $50 million.
- Brainstation acquired Wyncode in January 2021
- SNHU acquired Kenzie Academy in March 2021.
2020 Coding Bootcamp Acquisitions
- K12, the publicly traded online K-12 school and education management provider, paid $165 million in cash to buy Denver-based coding bootcamp Galvanize. For K12, the deal means adding more coding curricula for students in its Destinations Career Academies, which offers high school and career training program hybrids. For Galvanize—which is also Hack Reactor—the deal provides additional funding to grow its corporate learning business, add more physical locations, and increase its services to the military.
- K-12 acquired Tech Elevator for $24M
- Carrick Partners acquired Flatiron School from WeWork for an undisclosed amount.
Summary of Coding Bootcamp Acquisitions
The following is a summary of the publicly announced acquisitions of tech-related bootcamps since 2014. Keep in mind that only large transactions are typically announced to the public. We estimate that 75% of the bootcamp transactions each year are small and are not announced to the public.
|Nov-2022||Fullstack Academy||Simplilearn (Blackstone-backed)||Not Disclosed|
|Nov-2022||Grand Circus||Digital Intelligence Systems||Not Disclosed|
|Jul-2022||Holberton School||African Leadership Group (ALG)||Not Disclosed|
|Jun-2022||Emil||Le Wagon||Not Disclosed|
|May-2022||LUCY Security||ThriveDX||Not Disclosed|
|Oct-2021||Pentester Academy||INE||Not Disclosed|
|Aug-2021||Cybint||ThriveDX (HackerU)||$50 Million|
|Aug-2021||DigitalCrafts||American InterContinental University System||Not Disclosed|
|Mar-2021||Kenzie Academy||Southern New Hampshire University||Not Disclosed|
|Feb-2021||Wyncode Academy||Brainstation||Not Disclosed|
|Nov-2020||Tech Elevator||K12 (now Stride)||$24 Million|
|Jun-2020||Flatiron School||Carrick Partners||Not Disclosed|
|Jan-2020||Galvanize/Hack Reactor||K12 (now Stride)||$165 Million|
|Aug-2019||SecureSet Academy||Flatiron School||Not Disclosed|
|Jun-2019||SkillsFund||Goal Structured Solutions||Not Disclosed|
|Mar-2019||Fullstack Academy||Bridgepoint Education (now Zovio)||$50 Million|
|Aug-2018||Designation||Flatiron School||Not Disclosed|
|Jul-2018||Hack Reactor||Galvanize||Not Disclosed, but estimated at over $32 Million|
|Apr-2018||General Assembly||Adecco||$413 million|
|Dec-2017||Viking Code School/The Odin Project||Thinkful||Not Disclosed|
|Oct-2017||Flatiron School||WeWork||Not Disclosed|
|Aug-2016||Bitmaker Labs||General Assembly||Not Disclosed|
|May-2016||DevMountain||Capella Education (now SEI)||$20 Million|
|Apr-2016||Hackbright Academy||Capella Education (now SEI)||$18 Million|
|Mar-2016||Starter League||Fullstack Academy||Not Disclosed|
|Jan-2016||New York Code & Design Academy||Strayer Education, Inc||~$7 Million|
|Sep-2015||Mobile Makers||ReactorCore/Hack Reactor||Not Disclosed|
|Jul-2015||The Iron Yard||Apollo Education||Not Disclosed|
|Nov-2015||Market Motive||Simplilearn (Blackstone-backed)||Not Disclosed|
|Apr-2015||Software Guild||Learning House||Not Disclosed|
|Jan-2015||MakerSquare||ReactorCore/Hack Reactor||Not Disclosed|
|Nov-2014||Zipfian Academy||Galvanize||$10 Million|
|Jun-2014||Dev Bootcamp||Kaplan Test Prep||Not Disclosed|
Notable Coding Bootcamp Acquisitions
The first reported acquisition of a coding bootcamp was Kaplan Test Prep’s purchase of Dev Bootcamp in June 2014. Although this was the first acquisition in the coding bootcamp industry, it wasn’t Kaplan’s first foray into coding bootcamps. Kaplan launched its data science bootcamp Metis in early 2014. In 2017 Kaplan integrated Dev Bootcamp into Metis and retired the Dev Bootcamp brand.
Galvanize acquired Zipfian Academy in November 2014. Zipfian Academy was one of the first coding and networking bootcamps in the US. After one year of success, it was acquired by the Denver-based education & coworking powerhouse Galvanize.
ReactorCore acquired MakerSquare in January 2015. After ReactorCore was acquired by MakerSquare, ReactorCore’s first major move was to acquire Chicago-based mobile bootcamp Mobile Makers in September 2015.
The Iron Yard acquired Apollo Education as a “strategic investor” in July 2015. As of October 13, 2017, The Iron Yard is no longer operating.
Strategic Education, Inc. (SEI), the publicly traded holding company for Strayer Education, Inc., acquired New York Code & Design Academy in January 2016. New York Code & Design Academy is no longer operated as a separate brand.
Capella Education acquired Hackbright Academy in April 2016 and shortly afterward acquired DevMountain. Capella Education was later acquired by SEI.
WeWork acquired Flatiron School in October 2017, then in May 2018, WeWork also acquired MissionU.
A few months later, Flatiron School (now a part of WeWork) acquired the UX design bootcamp, Designation, and the cybersecurity bootcamp, SecureSet Academy.
After growing too quickly and facing financial challenges, WeWork sold off most of its assets, including selling Flatiron School to Carrick Partners in June 2020.
In a classic roll-up strategy, Thinkful began acquiring several of its smaller competitors to boost its value. Starting in 2017, Thinkful acquired Viking Code School and The Odin Project. Then, in April 2018, they acquired Bloc. When Thinkful reached its desired valuation, it sold to Chegg for $100 million.
Adecco, the large tech staffing company, acquired General Assembly in April 2018 for $413 million. According to Axios, General Assembly had been valued at $440 million. Between 2011-2015, General Assembly raised approximately $120 million in VC funding and earned $100 million in revenue in 2017. That was the largest bootcamp deal at that time.
However, two years later, 2U acquired Trilogy Education in April 2019 for a record-breaking $750 million!
In early 2022, Centage Group acquired InfoSec, the leading provider of tech-related certification prep courses, for $179 million.
Toward the end of 2022, IT staffing provider Digital Intelligence Systems LLC (Disys) acquired Grand Circus, a virtual coding bootcamp provider that also connects talent to employers.
Outlook for Coding Bootcamp Acquisitions
Many industry analysts are pessimistic about the future of coding bootcamps because of the rapid advances in artificial intelligence and the ability of AI to write relatively sophisticated code. We do not share that pessimism. AI will still need talented coders to break projects down into the components that an AI can handle, then direct and instruct the AI about the project parameters, and finally review the AI’s work product and make necessary tweaks and adjustments. So rather than reducing the demand for programmers, we expect the nature of the course to change and evolve as the technology sector changes and evolves.
About the Author and Jackim Woods & Co.
Rich Jackim is an education industry investment banker, educational industry entrepreneur, and former mergers and acquisitions attorney.
For the last 25 years, Rich has been providing boutique investment banking services to middle-market companies in the education sector.
Rich also founded a successful training and certification company called the Exit Planning Institute which he sold to a private equity group in 2012.
Rich is also the author of the critically acclaimed book, The $10 Trillion Dollar Opportunity: Designing Successful Exit Strategies for Middle Market Businesses.
Jackim Woods & Co offers skilled mergers and acquisitions advisory services to privately owned schools, colleges, and EdTech companies in both sell-side and buy-side transactions. Jackim Woods & Co has arranged over 100 successful transactions, ranging in value from less than one million to more than eighty million dollars.
If you own a tech boot camp or another education-related business and would like to explore your options, I would welcome an opportunity to speak with you. Feel free to contact me at 224-513-5142 or email@example.com.Read More
Valuations for vocational schools and training companies are at record highs now. As business performance rebounds, buyers are competing for strong performing businesses. That has led to an increase in the number of education-related businesses that were sold in Q3 of 2021. The number of education deals that closed in the third quarter increased 17% over the previous quarter, and 11% from the same quarter in 2020, according to Jackim Woods & Co, which tracks and analyzes vocational school and training company sale transactions.
2021 Education Industry Seller Confidence Index
Valuations for vocational schools and training companies are at record highs now because seller confidence is up. As the economy rebounds, owners of vocational schools and training companies are returning to the market, feeling more confident they can sell their schools and training companies for a good price and less willing to wait until the COVID pandemic is over. Seller confidence increased to 57 out of 70; that’s up from 45 in 2020. This is the highest seller confidence level since the high of 58 in 2018. Today 49% of the respondents believe they can receive a higher sale price for their school or training company today compared to a year ago, and 46% of respondents said the top factor motivating their confidence was an improvement in enrollment and revenue.
The average revenue for vocational schools and training businesses that were sold in the third quarter was $755,000, up 6% from the same time last year. Meanwhile, buyers of education-related businesses, especially Title IV schools, are paying record-high prices for businesses that performed well during the pandemic. The average sale price in the third quarter hit a new high of $1,780,000; that’s 17% higher than the previous year and 40% above pre-pandemic levels.
With current valuations above where they were pre-pandemic, many school owners are thinking now may be the right time to exit.
2021 Education Industry Buyer Confidence Index
Valuations for vocational schools and training companies are also at record highs because buyer confidence is up. Buyers noted that there is a limited supply of profitable well-run schools and training businesses on the market. In addition, several buyers noted that because of the shift to online learning, schools will be able to expand their geographic reach while reducing the cost of delivering educational services. The combination of these two factors signals significant growth opportunities and higher margins for well-run schools and training companies in the future. As a result, buyer confidence increased to 60, up significantly from 48 in 2020 and only slightly above the buyer confidence level of 59 in 2018.
It is interesting to note that demand for high-performing vocational schools and training businesses is increasing. According to Rich Jackim, Managing Partner of Jackim Woods & Co., “buyer inquiries on our education-related listings are up 39% since the same time last year. However, many business owners are putting off selling until their schools or training companies have fully recovered, so the supply of profitable, well-run schools is still limited. This is driving up values and makes it a sellers’ market.”
If you are beginning to think about selling your training business or Title IV vocational school and would like to explore your options, please contact Rich Jackim at firstname.lastname@example.org for a FREE, confidential, no-obligation consultation.Read More
As business performance rebounds, buyers are competing for strong performing businesses. That has led to an increase in the number of businesses that were acquired in Q3 of 2021. The number of closed transactions in the third quarter increased 17% over the previous quarter, and 11% from the same quarter in 2020, according to BizBuySell’s Insight Report, which tracks and analyzes U.S. business sale transactions. The report also includes an analysis of survey responses from over 2,000 business owners, business buyers, and business brokers.
2021 Seller Confidence Index
As the economy rebounds, sellers are returning to the market, feeling more confident they can sell their businesses for a good price and less willing to wait until the COVID pandemic is over. Seller confidence increased to 57 out of 70, up from 45 in 2020. This is the highest seller confidence level since the high of 58 in 2018. 49% of the respondents believe they can receive a higher sale price today compared to a year ago, and 46% of respondents said the top factor motivating their confidence was improved sales or revenue.
The average revenue for businesses sold in the third quarter was $671,000, up 6% from the same time last year. Meanwhile, buyers are paying record-high prices for businesses that have continued to perform well during the pandemic. The average sale price in the third quarter hit a new high of $350,000; that’s 17% above the previous year and 40% above pre-pandemic levels.
With current business valuations higher than they were pre-pandemic, many business owners are thinking now may be the right time to exit.
2021 Buyer Confidence Index
Buyers noted that there is a limited supply of profitable well-run businesses on the market and they regret missing out on buying last year while prices were lower. As a result, buyer confidence fell to 48 out of 70, down significantly from 60 in 2020 and slightly above the buyer confidence level of 47 in 2018.
It is interesting to note that demand for high-performing businesses is increasing. According to Rich Jackim, Managing Partner of Jackim Woods & Co., “buyer inquiries on our listings are up 33% since the same time last year. However, many business owners are putting off selling until their businesses fully recover, so the supply of profitable, well-run businesses is still limited. This is driving up values and makes it a sellers’ market.”
If you are beginning to think about selling your business and would like to explore your options, please contact Rich Jackim at email@example.com for a FREE, confidential, no-obligation consultation.Read More
The number of businesses that were acquired continued to rebound with the number of closed transactions in the third quarter up 17% over the previous quarter and up over 11% year-over-year. That’s according to BizBuySell’s Q3 Insight Report, which tracks and analyzes U.S. business-for-sale transactions.
Sellers are returning to the market, feeling more confident they can receive a good price and less willing to wait as the effects of the COVID pandemic linger on, including supply chain disruptions and staffing shortages.
Seller confidence index increased to 57 in 2021, up from 45 in 2020, which is the highest mark since the high of 58 in 2018. Of those surveyed, 49% of business owners felt they could receive a higher sale price today compared to a year ago, and 46% said the top factor that influenced their decision to sell was improved sales and revenue.
“The number of active sellers in the market is still lower than in previous years, but we have definitely seen an uptick in new clients since 2020. The shortage of good companies for sale, combined with low interest rates and a stock market at all-time highs has driven up the value of the companies that are currently for sale,” said Richard Jackim, Managing Partner of Jackim Woods & Co.
The total value of mergers and acquisitions in the education sector increased by more than 50% from the second half of 2020 to the second half of 2021, as companies across the industry rushed to add education-related companies to their portfolios, according to a report by mergers and acquisitions advisory firm, Jackim Woods & Co.
Jackim Woods & Co. is a mergers and acquisitions firm that provides advice and financial consulting to middle-market companies in the education sector.
The overall number of individual M&A transactions also rebounded to pre-pandemic levels.
Buyers of education companies closed 210 mergers in the first half of 2020, and 240 acquisitions during the first six months of 2021.
The total value of acquisitions in the education sector between January and June was $19.4 billion, largely driven by Platinum Equity’s $6.4-billion acquisition of McGraw Hill, the report noted.
The market value of deals closed during the first half of 2021 had almost as much market value as all the deals closed during all of 2020.
Private equity-sponsored transactions accounted for 40% of deals during the first six months of 2021. That’s 8% higher than the average number of private equity-backed deals for the last three years.
According to Jackim Woods & Co, 97 of the 240 deals during this time frame were sponsored or financed by financial investors like private equity, venture capital, or other investment firms. That’s the highest number in three years and a 130% increase over the first half of 2020.
Twelve deals during the first half of 2020 had purchase prices of more than $100 million, and at least seven of those involved the K-12 sector. About 33% of the deals had purchase prices of between $4.5 million and $54.6 million.
The K-12 EdTeh segment surpassed the professional training services sector as the education industry’s most active market segment in the first half of 2021.
Approximately 50 deals involved the acquisition of professional training companies in the second half of 2019 and about 45 deals covered professional training services in the first half of 2021. There were approximately 40 deals in the K-12 EdTech segment in the second half of 2020, while nearly 60 deals closed in that segment in the first half of 2021.
For other segments of the education sector, the analysis showed a mixed picture of market activity for the first six months of this year compared to the second half of 2020.
The number of deals in the childcare services and higher-education EdTech segments increased during this period, but the number of deals in professional training technology, higher-ed institutions (including Title IV vocational schools), and K-20 services decreased. Deals involving for-profit K-12 schools remained stable.
According to Rich Jackim, Managing Partner of Jackim Woods & Co, “we are seeing strong demand for Title IV vocational schools that prepare students for careers in the healthcare professions. We’re also seeing strong demand for non-Title IV schools, like commercial driving schools and cybersecurity and programming schools. Valuations for these schools have increased significantly over the last 24 months.”
In addition to the McGraw Hill acquisition, the most interesting education sector deals in the first half of 2021 included
- Byju’s $900 million acquisition of Indian tutoring company Aakash Educational Services
- Renaissance’s $650 million acquisition of Nearpod
- Kahoot’s $435 million acquisition of K-12 secure-sign-on provider Clever
If you own an education-related business, including a Title IV college or vocational school, a k-12 proprietary school, or an EdTech company and are beginning to think about selling, we would be delighted to speak with you and help you explore your options.
Contact Rich Jackim, Managing Partner of Jackim Woods & Co at 224-513-5142 or firstname.lastname@example.org.Read More
Alpin Haus, an outdoor recreation powerhouse in New York, announced the acquisition of Garick RV in Oak Ridge, NJ.
Alpin Haus, started as a small family-owned business in 1964, is one of the leading outdoor recreational retailers in the northeast and employs over 200 people across five locations. They feature a full line of RVs, snowmobiles, skis, boats, pools, and spas.
With the acquisition of Garick RV, Alpin Haus now has six locations and its first location outside the state of New York.
Garick RV’s founder, Gary Threlfall said, “I’m excited to find a buyer like Alpin Haus that shares the same core values which I founded Garick RV on over 35 year ago. I’m confident Garick’s customers and employees are in good hands with Alpin Haus.”
Founded in the spring of 1983 by two high school friends as a RV rental company, Garick RV bloomed into a dealership with a sales center and a 10-bay service center employing over 20 people.
“Garick RV has an outstanding reputation, and this acquisition provides an additional platform to offer Alpin Haus’ services and products,” said Andy Heck, President of Alpin Haus.
“Our companies’ core foundations of providing outstanding customer service align exceptionally well,” Heck said. “We are excited to grow beyond our state borders and we look forward to serving this expanded market for years to come.”
Jim Bates, Partner, at Jackim Woods & Co. (www.jackimwoods.com) a middle market mergers & acquisitions firm with years of experience working with a variety of recreational vehicle companies represented Garick RV in the sale and played a key role in managing the transaction.Read More
M&A deal activity has recovered from its 9-month pandemic-related dip. Based on the overall strength of the stock market, we expect continued strong mergers and acquisitions activity for 2021 as well.
The total dollar value of mergers and acquisitions announced in the U.S. fell to roughly $20 billion in March as the pandemic set in, according to data from Barrons. That was a sharp drop-off—from about $180 billion in January. Yet the recovery has been equally sharp. Deal volumes reached approximately $205 billion in October according to Barron’s data.
Looking forward, Rich Jackim, managing partner at Jackim Woods & Company said, “low-interest rates, optimism about a COVID vaccine, record-breaking fundraising by Special Purpose Acquisition Companies (SPACs), and even a less contentious global trade policy will all contribute to continued strong M&A activity in 2021.”
Interest rates are currently at historic lows, reducing the cost of funding acquisitions. In addition, the good news about several COVID vaccines provides a light at the end of the tunnel and the assurance that buyers need to make a purchase.
And SPACS—special purpose acquisition corporations that raise money through an initial public offering in order to buy other companies—have raised more than $64 billion this year. SPACs raised just $13 billion in all of 2019, suggesting that SPACs will be the new driver of middle-market M&A activity in 2021.
“The M&A wave is regaining momentum and should continue for the next 12-18 months,” Jackim says. He believes the following industries will see an uptick in M&A activity in 2021.
2021 will be a year of recovery as retail and restaurant workers displaced by COVID-related closures seek other careers and gainful employment. As a result, Jackim believes the vocational/technical training and education sector will of interest to buyers and investors. The US has been suffering from a shortage of skilled workers for over a decade, so there are plenty of high paying jobs available for people with the right skills. Enrollment in vocational programs tends to rise as unemployment rises, so we expect 2021 to build on the strong results that the technical education industry saw in 2020, and to attract renewed interest from both financial and strategic buyers and investors.
The energy industry is another industry where we expect to see a lot of M&A activity in 2021. The price of crude oil has dropped to just above $40 a barrel since early summer, nowhere near the $63 a barrel price at the beginning of the year. At the same time, the rise of clean energy and potential regulation are threatening companies that focus on traditional fossil fuels. As the fossil fuel industry shifts toward a lower-growth model, exploration and production companies will be looking to generate returns through acquisitions that would yield economies of scale and other benefits, or diversify their product or service offerings away from fossil fuels.
Fueled by a multi-billion-dollar deal, the value of mergers and acquisitions in the education sector increased by more than 80% in the first half of 2020, even though the number of transactions dropped to a 30-month low, a new report by Jackim Woods & Co finds.
Overall, the market value of deals in the education sector increased from $4.9 billion in the first half of 2019 to $9 billion during the same period in 2020, according to research by the mergers and acquisitions firm, Jackim Woods & Co.
Jackim Woods & Co is an investment banking firm that provides advice and financial consulting to middle-market companies in the education sector.
Their analysis tracked 1,128 education sector deals between 2018 and June 2020.
Sixty-six percent of that total came from Blackstone’s $6 billion acquisition of student housing company iQ Student Accommodation, which has been described as the largest-ever private real estate deal in the United Kingdom.
Meanwhile, overall dealmaking activity in the education sector slowed significantly due to COVID-19 shutdowns and concerns about the long-term impact it would have on the sector. Jackim Woods & Co tracked 207 mergers and acquisitions in the education sector during the first six months of the year, down from 242 during the same period last year.
That figure also represents the fewest number of total deals for a six-month stretch since at least the beginning of 2018, the period covered in the report by Jackim Woods & Co.
The overall dip in the number of mergers and acquisitions during the first half of 2020 was due to a steep decline in private equity sponsored deals. According to Rich Jackim, Managing Partner at Jackim Woods & Co, only 41 of the 207 deals closed during the first six months of 2020 were financed by private equity firms or other financial investors. That’s the lowest number of deals closed in the 30-month period the report covered and a 50% decrease compared to the same period in 2019.
Only seven deals in the first six months of 2020 were valued at more than $100 million, and at least two were in the K-12 sector. About 33% of the total transactions had values in the range of $4.5 million to $54.6 million.
The sector of the education industry that saw the most activity in the first half of 2020 was the professional training services category, which rose from 44 to 60 transactions. That accounted for nearly 30% of all deals during the first six months and marked the most transactions closed for the sector since 2018.
Activity in almost every other segment of the education industry tracked by Jackim Woods & Co — aside from the professional training sector — was down compared to the first half of 2019, according to the report. That includes sectors specific to K-12 institutions and the K-12 EdTech space, which includes companies that provide media and software used in schools.
The most interesting K-12 deals during 2020 include
• China Maple Leaf Education System’s $487 million acquisition of Singapore’s Canadian International School;
• K12 Inc.’s $165 million acquisition of Galvanize, a Denver-based company that offers coding boot camp programs; and
• Chegg’s $96 million acquisition of the math problem-solving app Mathway.
If you own an education-related business, including a Title IV vocational school, K-12 school, or EdTech company, and are thinking about selling, we would be delighted to speak with you and help you explore your options.
Contact Rich Jackim, Managing Partner of Jackim Woods & Co at 224-513-5142 or at email@example.com.Read More
Private equity investors have shown strong interest in education-focused companies in the last few years, and not just in edtech companies. Several things are responsible for this renewed interest.
- For the last 10 years, digital transformations in the classroom have caused the ed-tech market to soar and have led to an increased interest in all types of education-related investments.
- The U.S. faces a significant skill shortage across the board as our population gets older and as our society emphasizes professional careers over skilled-based careers. This had led to severe shortages in healthcare, the trades, and transportation.
- Approximately 30% of for-profit career colleges or vocational schools went out of business between 2008 and 2016, removing excess capacity from the post-secondary landscape, which led to a resurgence of interest from private equity groups.
- For the last four years, both the Republican administration and the Democratic Congress supported private education, which resulted in an upsurge in funding by federal, state, and local governments.
On top of that, the education industry is very fragmented, with many early childhood centers, career colleges, and training companies still owned by individuals, leaving private equity firms a lot of room for roll-ups to consolidate the industry and realize significant economies of scale.
In addition, the K-12 market has become more complicated, with new technologies rapidly changing the game. So having the right people in charge who know how to design and implement digital learning platforms is increasingly important, representing a unique opportunity for private equity and other tech-savvy investors. As a result, buyers and investors are spending more and more time developing world-class management teams to ensure their portfolio companies can provide teachers and students with the digital platforms and technical support they need to succeed.
For the past decade or so, buyers have been hesitant to invest in post-secondary education companies — ever since the Great Recession and implementing the Gainful Employment Rule during the Obama administration. However, things have turned around completely in the last four years for several reasons, including…
- Over 200 poorly run for-profit career colleges closed their doors before the 2017-18 academic year — continuing a long downward trend. But happily, at the well-run schools that survived, enrollment and revenue are rising again.
- The regulatory environment is more favorable because the Gainful Employment Rule has been greatly scaled back – even though it remains on the books for now.
- Most for-profit career schools are demonstrating better results regarding educational outcomes like gainful employment, making them more appealing to investors no matter the level of regulatory oversight.
- The education sector tends to do well in a recession. In general, post-secondary education does well when the economy slows down and unemployed people go back to schools, so education-related companies are a good hedge against recession in any investor’s portfolio.
- Valuations of early childhood centers, K-12 schools, and career colleges remain reasonable compared to other education sub-sectors like edtech.
- It isn’t just investors who’re interested in this space – lenders have returned as well. For example, Renovus Capital financed the Rasmussen acquisition with SunTrust, CIBC, and Bank of Ireland. NCK Capital financed its purchase of Tricoci in partnership with Greyrock Capital Group and NBH Bank.
That’s all good news for owners of education-related companies. Here are just a few of the deals in the education sector over the last few years —
- The Learning Experience, was purchased by Golden Gate Capital Partners Group-backed KinderCare Education, acquired Troy, Michigan-based Rainbow Child Care Center from Quad-C Management.
- Rasmussen College, a healthcare-focused career college system with 10,000 students across 22 campuses, was acquired by Renovus Capital Partners.
- The University of St. Augustine was acquired by Toronto’s Altas Partners in a deal worth $400 million.
- Allied Business Schools, which offers online real estate certification classes, was acquired by Colibri Group and Quad-C Management.
- Chicago-based Tricoci University of Beauty Culture was acquired by Dallas’s NCK Capital.
- Texas County Technical College in Houston, Missouri, was acquired by Arizona College.
- The National Business Institute of Florida was acquired by a private investor.
If you own an early childhood center, a Title IV career college, or a corporate training program and are interested in potentially selling, contact us at 224-513-5142 for a free, confidential, no-obligation discussion about the current market and your options.
About the author: Rich Jackim, the managing partner of Jackim Woods & Co, is an experienced M&A attorney, investment banker, business broker who has sold over 100 businesses. He is also an education sector entrepreneur who founded and sold a professional training company, so he understands the industry and the sales process from both an owner and a buyer’s perspective. If you are thinking of selling your early childhood center, K-12 school, career college, or training program, he would be happy to speak with you. His direct dial number is 224-513-5142, and his email is firstname.lastname@example.org.Read More
Veritext, the national leader in court reporting and litigation support solutions, announced that it has acquired David Feldman Worldwide (DFW) Court Reporting. DFW’s experience with very complex litigation cases and exemplary customer service complements Veritext’s full breadth of technical solutions and world-class data security. Together they will offer clients of both companies premier court reporting and litigation support solutions.
“DFW’s expertise in very complex litigation fits well with the experience and advanced technology Veritext brings to the table,” said Nancy Josephs, Chief Executive Officer of Veritext. Clients of DFW will have immediate access to Veritext’s state-of-the-art deposition suites, multimedia depositions, document repositories, remote depositions, online and mobile scheduling, paperless depositions and more. In addition, they will experience the world-class, HIPAA-compliant data security Veritext offers. “Combining the services of both companies makes the perfect union,” Josephs continued.
DFW was founded by David Feldman in 2002 along with his two children, Michael and Sheril, who have owned and operated the company since 2009. DFW’s client-facing team will stay on with David Feldman Worldwide, a Veritext Company after the acquisition, ensuring that clients will receive the same stellar service they have come to expect. DFW is based in New York City and serves clients across the United States and in foreign locations.
“By joining with Veritext, we will be able to offer our clients a full breadth of technology solutions to make the deposition process more effective. They will also have access to the more than 50 Veritext offices around the country,” said Michael Feldman, President of David Feldman Worldwide, a Veritext Company. “Veritext shares our commitment to quality court reporting and impeccable service, which makes this transition the perfect fit for our clients and our employees.”
Veritext is the largest nationwide provider of deposition and litigation support solutions, providing court reporters, advanced technology and services to law firms and corporations across the United States. Veritext has been serving the legal community since 1997 and has extensive experience in all types of complex litigation. The company recently announced acquisitions in Florida and New Jersey and their expansion in the St. Louis marketplace. More information can be found at www.veritext.com.Read More