Where is the Textbook Revolution this Dad Was Promised? (Updated 2024)February 19, 2024 Blog
Across the last two decades, every content-driven industry in our economy, from music to movies to books to…
The K-12 market continues to be an active sector as the ESSER funding cliff looms in 2024. With the increase of many new providers and solutions over the last few years during the pandemic, K-12 districts are now consolidating many of those same products and services and only retaining the most useful solutions for students, teachers, and administrators. Strategic and financial investors are responding to these market conditions with an increased focus on inorganic activity to bring more comprehensive solutions to the market to address the needs of their customers.
Tyton Partners represented the following K-12 transactions: School Specialty’s divestiture of EPS School Specialty, a K-12 supplemental curriculum product provider, to Excolere Capital Partners; Tinkergarten, an early childhood curriculum and educator training provider, in its sale to Highlights; Fairmont Schools, a private PreK-12 educational institution, in its sale to International School Partnerships; Creative Learning Systems, a K-12 STEM lab provider, in its sale to Exeter Capital; and an online dual enrollment and post-secondary course and certificate provider, in its sale to a private equity backed strategic sponsor.
The Higher Education market continues to grapple with the reality of a declining enrollment forecast, decreasing value proposition due to the volume of job-specific courses and certifications available to students, and lessening degree requirements from many employers. Degrees, however, are still viewed favorably and carry significant value for students’ long-term earning potential. These macro trends are coinciding with the further adoption of AI solutions, deeper integration of third-party providers, and continued prominence of hybrid and online programs across the institutional landscape.
Tyton Partners represented the following higher education transactions: Akademos, a leading online bookstore and course materials provider, in its sale to VitalSource Technologies, a portfolio company of Francisco Partners; Elentra, a SaaS platform for health science colleges and universities, in its sale to Achieve Partners; IU Group in its acquisition of the University of Fredericton; Meteor Learning, an OPM for online competency-based education programs, in its sale to Noodle Partners; and an AI-powered proctoring solution, in its sale to a LATAM-based education consulting services provider.
The corporate training landscape continues to be defined by the requirement for many employers to upskill and reskill their workforce to learn job-ready skills. Generative AI can potentially revolutionize this market segment, impacting everything from measuring training effectiveness and developing job-specific content to tracking personalized performance and behavior analysis. This technology is still in the early innings though, as there are currently few scalable opportunities ripe for investment.
Tyton Partners represented the following corporate training and continuing education transactions: Pryor Learning, an online training platform for businesses, in its sale to Trive Capital & Epic Partners; Wiley in its divestiture of Wiley Efficient Learning, an online business training platform, to UWorld; Wiley in its divestiture of Advancement Courses, a professional development course platform for teachers, to Teaching Channel, a portfolio company of Quad-C; Literacy Pro Systems, a SaaS-based adult learner information system platform, in its sale to Genius a portfolio company of Leeds Equity Partners; Infosec Learning, a virtual lab provider for hands-on cybersecurity learning, in its sale to ACI Learning a portfolio company of Boathouse Capital; Ease Learning, a corporate training and higher education course developer, in its sale to Freedom Learning Group; a teacher recruiting company in its sale to a private equity backed strategic sponsor; and New Horizons a live online instructor-led IT training course provider in its sale to a private equity backed strategic sponsor.
We are pleased to announce that Tyton Partners Investment Banking Division closed 2023 with a strong performance despite a global slowdown in M&A activity. We continued to serve our clients across the PreK-12, Higher Education, and Corporate Training and Continuing Education markets, as well as the broader TMT ecosystem. While macroeconomic conditions dampened investor sentiment for risk and large-scale M&A transactions, the lower middle market remained healthy and robust, particularly in the global knowledge sector. Several trends contributed to these market conditions including:
In 2023 corporate divestitures made a return after a dozen year bull run where historically even strategically incongruent divisional assets stayed within larger strategic platforms. Last year became the time to trim and prune non-essential assets. Tyton was sought out for its expertise in complex carve-outs and divestitures, securing over a dozen mandates to divest. Some of these were completed, several are in the market now, and we are bringing a host of additional divestitures to market in 2024.
Despite the market turmoil, Tyton Partners Investment Bank had another nearly record year, completing its 100th M&A transaction in 4 years.
In addition to leading the lower middle market league tables with completed transactions at Tyton Partners Investment Bank, Tyton Partner’s Center for Higher Education Transformation (CHET) has also witnessed a dramatic step up in deal flow, as ailing and distressed university and college market mergers compound, as well as strong and healthy institutions taking advantage of a plethora of geographical, online, and degree and certification curricular expansion opportunities. We expect 2024 to have the highest number of college and university mergers and acquisition activity in the history of Title IV regulation.
As always, we look forward to discussing these trends and their impact on your business over Q1, and supporting you in navigating the market shifts, identifying near-term growth opportunities, and exploring compelling capital market opportunities in 2024. Please reach out to us here if you are interested in a more in-depth discussion about the trends above and how to best position your business or investment thesis within the global knowledge sector for 2024 and beyond.
Wishing you great success and all the best in the New Year!
Tyton Partners Choose to Learn 2024 Uncovers 20% of U.S. K-12 Parents Want a New School Environment for Their Child – What Can the Education System Do?February 15, 2024 Press Releases
[BOSTON, February 14, 2024] – Tyton Partners, a strategy consulting and investment banking firm focused on the education…