It is widely know that education sector has been seeing hectic activity by the day from Private equity and venture funds, perceiving it as the hottest sector to chip in their funds. The appetite does not seem to vanish even till now as Helix Investments has invested $10 million in LearningMate Solutions, a provider of e-learning education solutions.
LearningMate provides various services like Content Development, LMS (Learning Management System) and VLE (Virtual Learning Environment) products. It was demerged from Educomp way back in 2003 and currently employs 200 people. Helix Investments earlier invested $12 million in Mahesh Tutorials, an offline test preparatory education company.
The investment would help company to increase capex expenditure and enter different verticals in education sector. The investment in e-learning is although lower compared to Learning Management solutions, the investment could very well proliferate the company’s growth rate.
Some other investments in e-learning & education sector:
- Pearson recently Invested into Educomp and TutorVista
- DE Shaw bought out the entire 35.5% stake of UTI Ventures in Excelsoft for $31 million.
- PreMedia, an e-publishing firm raised $18 million from JM Financial India Fund.
Education sector still on high grounds
Education sector is widely divided into different segments like offline test prep, pre-school, vocational training, corporate training, distance e-learning, education content, Learning Management solutions for education institutes.
The e-learning market in US is alone worth $1 billion a year and growing at an annual rate of 40%. The demand for cheaper education in US and European markets has opened whole lot of e-learning and other outsourcing opportunities for Indian players. They have also accrued major benefit due to their dominance in product profile and sector domain knowledge.
The private equity thrust on other education companies is also due to major spending by Indian families on education needs of their children. The sector is also hoping for major relaxation in FDI norms which would in turn boost domestic demand as it was recently conveyed by Kapil Sibal, HRD minister. The government Capex on education in itself is a major opportunities for many education players as they bag contracts worth millions of dollars.
Thus it can be correctly said that India might have been laggard in Online sector compared to western peers but would showcase dominance in Education sector at most.
This sounds good ..EDUCATION – The hottest sector !!
Even in a downturn economy and with rising risks of defaults to businesses, there is no more important industry than education for bringing hope and real business stability to the national economy.