The EdSheet Vol. 18

Hello! 

Looking forward to seeing many of you in NYC for HolonIQ’s Back to School Summit in a couple of weeks. Send me a note if you’d like to grab coffee or an Aperitivo.

In the meantime, a few key topics from this newsletter:

• Uwill acquires TBH: Exciting when a plan comes together. Last summer, Uwill founder and CEO Michael London spoke with this newsletter about how he regularly scans the market for high-quality, mission-aligned teams that can complement Uwill’s organic growth. That formula has created a market leader in 5 short years, serving 4M+ students/year and still growing at 30%+.   

• 5,762 job applications, 0 offers: Job applications feel good to complete, but are no longer a good metric for job hunting. At the moment, AI is only exacerbating this problem. We need to come up with better strategies for helping people find new jobs, especially recent grads.

• CHLOE at 10 and the LMS at 30: Online learning is now a part of life for college students. The 10th annual Changing Landscape of Online Education (CHLOE) report provides new insights into how this impacts universities today while Blackboard co-founder and former Parchment CEO Matthew Pittinsky reflects on how the industry has changed in the 30 years he has been involved in digital education.

With that, onto the news!

Funding / M&A

Whiteboard Advisors not only provides policy and market-related diligence and advisory services, we track every financial transaction that happens in education — and keep a record of all deals that are publicly announced.

The following transactions caught our eye over the past few weeks. If you have a deal to announce, or would like access to the full transactions database, please reach out.

Venture Funding

• Darwinbox raises $40M / India, HR Tools / Teachers’ Venture Growth

• Adda247 raises $34M / India, Content Provider (Test Prep) / Google, Edge Ventures, Asha Impact

• Loft Dynamics raises $24M / US, VR (Training Provider) / Friedkin, Alaska Airlines, Sky Dayton, Craft Ventures UP Partners

• Edumentors raises £1.5M / UK, AI Tutoring / Magna Ventures

• Paddy raises €1M / Germany, K12 Software Services / KfW Capital

M&A

• Uwill acquires TBH / US, Mental Health

• Duolingo acquires NextBeat for $34M / US (UK), Content Platform

• Sycamore acquires TuitionEP / US, K12 Software Services

• Fitch Learning acquires Moody’s Learning Analytics Learning Solutions & Canadian Securities Institute / US (Canada), Corporate Training & Certification

• Greenn acquires Xgrow / Brazil, Content Platform

Buyouts

• CVS DIF acquires American Student Transportation Holdings / US, K12 Infrastructure

Next month, the 24th Annual 'Back to School' Summit will bring together 600+ education leaders from US and global institutions, industry CEOs, investors, technology representatives, economic development and philanthropic organizations. 

The Whiteboard Advisors team has been a longtime presence at the summit and will be presenting on the latest state and federal policy updates. We hope to see you there (and let us know you’re coming)!

Use code: JOINWBA@BTS for 30% off registration

What’s on your Whiteboard? Policy Perspectives

• Former U.S. Department of Education General Counsel Charlie Rose discusses the 2011 “Bundled Services” Dear Colleague Letter and its impact on today’s University and OPM markets.

News of Note

This section is intended to be more exploratory, a reflection of stories I think are important and ideas/trends I’m contemplating. It is free today, but will be going behind a paywall soon.

ECE

• Why child care costs so much - and how to fix it. TLDR, Baumol’s disease. The author advocates for raising the immigration cap for jobs tied to childcare (J1 and H2B), but a transferable subsidy seems more consistent with the direction K12 policy is headed (see below) and like it had some traction with both parties during the last election cycle.

K12

• As noted a few weeks ago, we are entering the school choice era of US K12 education - where the norm is/will be a highly transferable education subsidy tied to each school-age child. 

  • The strongest argument for school choice is that it will encourage more experimentatal school models - leading to new approaches for academics, social life and extracurriculars, and wraparound services. The flip side, as we have seen in Higher Ed, is that there is going to be a lot more money spent on marketing.

  • The jury is still out on how this transferable subsidy will impact public school enrollments, which continue to fall across the US. However, there are a few bright spots of public school enrollment growth, several of which are in states with well-known choice initiatives, like Florida, Utah, and Texas.

    • Related to the complications of growing public school enrollments, the rising cost of pension plans.

• Math friends and colleagues: Duolingo has entered the chat.

Higher Ed

• American universities are in a financial pickle. We’ve known this was coming for a while due to demographic trends, but the problem has been magnified by the nine-figure settlement payments the Trump Administration continues | to | demand.  

  • There is little consensus on how to respond to these financial challenges. As a rule, universities - even large ones - maintain a smaller discretionary budget than you might think. Some are responding by selling financial positions and/or raising debt.

  • Others are responding by throwing tomatoes at one another (politely, of course).

  • Curiously absent from this conversation? Megadonors covering the bill. Not for lack of megadonors though, Larry Ellison just bought himself an institute at Oxford. And brought the University of Michigan’s erstwhile president with him.

    • Related, foreign universities might be smelling blood in the water in the US market. Australia raised their national cap on international enrollments.

  • Also no longer paying the bills? College sports. Where the boosters are now paying the players directly, often in the form of sweet rides.

  • What IS paying the bills? Dorm room decorators and, more seriously, institutional differentiation. Grand Canyon University, sometimes maligned for their tax-status strategy over the past 10 years, continues to have no problem attracting new students with a value proposition of affordable tuition and Christian values. 

    • Also deserving mention as a financial salve: industry partnerships. Google, among others, plans to spend $1B with universities on AI training.

• The LMS at 30. Excellent long-form article on the history of the LMS industry from Matthew Pittinsky, co-founder of Blackboard (and, later, CEO of Parchment). 

  • This post also includes an incredible easter egg: a 1998 recording of Blackboard’s Series A fundraise, which used an overhead projector (A device the Gen Z mind cannot even comprehend) for slides but whose main points are still remarkably resonant.

• These college professors will not bow down to AI. “So many of my colleagues are discouraged and bitter. I cannot live my life that way, and I refuse to do so.” The article is about teaching in higher ed, but this quote is a good litmus test for anyone in any industry.

• The 10th annual CHLOE report: required reading for anyone participating in the Higher Ed space.

  • However, if you are unable (or unwilling) to read the full report, Glenda Morgan provides a great synopsis.

• Hank Green’s 16M+ subscriber Crash Course Youtube channel is one the largest educational content providers in the world. Last week we learned that Green’s platform partnership with ASU generated 13,000 course enrollments and 2,000+ credits earned.

Workforce

• Applying for jobs is like eating Doritos - tastes great in the moment, but is ultimately empty calories. If you apply for 5,762 jobs and get 0 offers, maybe you need to reconsider your approach.

  • I don’t say this to be mean. I say it because we have to get more creative about how careers are built. How do we coach young people towards a career in space exploration rather than endlessly applying for paralegal jobs?

  • I cannot emphasize this enough, applying for jobs is not job hunting. AI weaponizes this problem, it does not fix it.

  • So, what do we do? Brush up on our woodworking skills. This woodworker just raised $2M, why not you? 

    • Related, social media opens a window to the trades for young people. I am here for all your trade work content, especially if it has to do with vintage car mechanics.

    • Just as long as you don’t sell me on the welder who makes six figures, which is very much a myth.

Other

• You may not have an AI friend, but someone close to you probably does. Character.AI, one of the first companies to market with an LLM-enabled “companion” chatbot says they have 20M monthly active users who spend, on average, 75 minutes per day chatting with their “friends.”

Looking for your next opportunity in education? Check out our W/A Jobs, which features 3,376 career opportunities from 306 organizations across the education industry. A few roles that we’re excited about from the past week:

• Udemy is hiring a Vice President of Corporate Development to identify, evaluate, and execute M&A opportunities for the company

• Lovevery is hiring a Product Development Associate to support the product development team in bringing new products to market

• Code.org is hiring a Director of Operations on their Technology & Innovation team to lead the strategic evolution of the organization’s Salesforce platform

Whiteboard Advisors is the leading policy-related diligence partner for education investors, advising on most major private equity transactions in education over the past 15 years. Our specialty is translating complex policy dynamics into insights that inform decision-making. Reply to this email to learn more.