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Educomp Acquires 51% Stake in Learning.com. Pays Rs. 105 Cr. A look at Online Tutoring in India as a PPO Service
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Delhi-based Educomp Solutions has acquired a 51 per cent stake in US-based web-delivered curriculum provider, Learning.com for around Rs 105 crore. The deal includes the purchase of existing shares as well as an infusion of new capital into the company. This is Educomp’s second strategic investment after the acquisition of Singapore-based Ask n Learn — a K12 company as reported by Business Standard.
The company has a large content developing competence in India due to which we can take our intellectual property to schools in the US. Apart from that we have mined cross border synergies,” said Shantanu Prakash, managing director, Educomp Solutions. The company also plans to customise the course curriculum according to the Indian standards in three-four months.
The move by Educomp reminds me of similar investments that have been made by Kal Raman’s GlobalScholar. They have a development team in India, which is developing content around things like Curriculum Instructional Information Systems (CIIS), web-enabled curriculum management, student assessment and gradebook software solution designed for schools and school districts in the US. They have also acquired companies that are similar strategic investments. GlobalScholar acquired Excelsior Software, a Colorado-based company which designs student gradebook and assessment software currently utilised by teachers in 1,000 school districts across the US. They acquired the company for $27 Million.
While GobalScholar is looking at consumer technologies + B2B technologies, I think Educomp is looking primarily at B2B services. Both firms are looking at revenues primarily from B2B sources. On the other hand online tutoring services for India can also be looked as revenue making opportunities.
A report by Alok Aggarwal of Evalueserve, a global research and analytics services firm, puts online tutoring from India as one of the PPO services to watch out for. Others with strong growth potential are website development, graphic design, and editorial and writing services, according to the report. Aggarwal says that with technology advances and the growth of the Internet, small offices, home businesses and individuals can utilize PPO services. Individually taken, each contract is often of low value, usually between $100 and $5,000. “But since the number of end consumers and small businesses is enormous, the total addressable market in the United States alone easily exceeds $20 billion,” the report says. This report was listed in IndiaKnowledge@Wharton.
The United States, India, and China are key markets for this industry.
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