Must Read Blog March 30, 2023

K-12 Market Activity: Changing Seas

As investors brace for shifts in K-12 buying behavior post-ESSER, continued activity in the K-12 market reveals where some K-12 business are placing bets.

Notably, two recent deals – Paper’s acquisition of MajorClarity and IXL Learning’s acquisition of Teachers Pay Teachers – highlight organizations seeking to balance market expansion with broader and more diverse stakeholder coverage. In these cases, new platform capabilities create not only new market exposure, but inroads to new constituent groups.

At a time when K-12 companies risk drowning in a sea of education technology, providers should be disciplined when it comes to new features and add-ons. Still, K-12 systems are evolving; expanding reach into distinct end markets helps protect against market shifts and creates opportunities to cater to new instructional models. Gone are the days when a single point of sale in the district is sufficient to meet the expectations and needs of key constituencies.  

As Paper and IXL Learning turn towards integration and cross-sell initiatives, these deals will create a ripple effect across the K-12 market. Competitive intensity will likely ramp up in college and career navigation space; likewise, teacher- and community-generated content will continue to put pressure on curriculum providers to adapt to a more dynamic and open-sourced market landscape.

Another ship to carry students along

With its acquisition of MajorClarity, Paper has taken a step towards a more holistic student support system.

Paper’s tutoring service helps districts meet students’ immediate learning needs; now, with MajorClarity, it brings counselors and parents into the fold, helping those same students connect with longer-term college and career aspirations. As indicators of teacher burnout persist, a multifaceted approach to student support that offers a variety of touch-points is one way to withstand this turnover.  

More broadly, Paper’s acquisition reveals how the competitive environment continues to evolve. Historically, intense competition has resided within a given category (e.g., curriculum, assessment, administrative technology). Now, as platforms become more versatile, competition increasingly ramps up from outside it – sometimes overnight. Organizations that support college and career outcomes may feel greater urgency to discover meaningful ties to the classroom. Similarly, instructional resource providers who sell into the classroom must now compete for mind- and market-share with wraparound service providers who drive student engagement outside of it.

Supporting the whole crew’s workflow

IXL Learning’s acquisition of Teachers Pay Teachers adds to a string of recent acquisitions, including Curiosity Media, which was represented by Tyton Partners in its sale to IXL in 2022. Others include:

  • Emmersion – AI-powered language assessments, 2022
  • Rosetta Stone – technology-based language learning, 2021
  • Wyzant – tutoring marketplace, 2021
  • – literacy and vocabulary platform, 2020
  • – education resource platform, 2019
  • ABCya – computer games and learning apps, 2018

With the addition of Teachers Pay Teachers, IXL Learning now has most stakeholder groups covered. Parents can subscribe to IXL Learning for homeschool curriculum, hire private tutors using Wyzant, and/or subscribe to language applications in Rosetta Stone. Administrators can adopt IXL as supplemental curriculum. And now, teachers can tap into resources across the Teachers Pay Teachers marketplace.

The unlikely union between digital curriculum provider and open-sourced content marketplace sends a signal to buyers that it is okay to embrace rather than resist new procurement methods. It’s also an endorsement of teacher empowerment. Relative to the past, when state and district purchases were driven by predictable, centralized adoption cycles, more than a third of teachers now influence the purchase of instructional materials. As open-sourced content becomes more mainstream and teacher voices get even louder, K-12 leaders will consider ways to support new curriculum models. At the same time, they should consider the benefits and risks of catering to multiple audiences to ensure everyone’s interests – including those in the district – are buoyed.  

The bottom line

K-12 stakeholders often operate on different wavelengths. While their incentives generally align, the “jobs to be done” that cater to different constituent groups vary, which introduces both challenges and opportunities to K-12 business leaders.

As we enter the heart of the AY2023-24 buying cycle, leaders should consider ways that synergy exists for multiple stakeholder groups across their portfolio. With product teams, this means finding ways to develop valuable use cases for parents, teachers, counselors, and/or administrators. On the marketing front, these efforts should be pursued in ways that bolster, rather than complicate, your brand narrative. As companies like Paper and IXL expand their portfolio, new competitive tides create ripple effects across the sector that will warrant responses from K-12 districts and business leaders.