IBIS Capital | Global e-Learning Investment Review 10 Things You Should Know About e-Learning 1
$4.4tn
5
4
2012 global education expenditure
The cost of education has risen 84% since 2000, 37% higher than CPI, which has lead to situations like the US student loan debt accumulation to over $1tn. e-Learning is a cost effective alternative
Supported by 1.4bn students and 62.5m educators
2
The e-Learning market is the fastest growing market in education, standing at $91bn in 2012
23% 3
700m
individuals
7
8
257%
IBIS Capital’s near term view on e-Learning:
3,000+
9
10
2013
Consolidation will be the theme as businesses seek to expand geographic reach, scale and service offering
of the world’s population will lack basic literacy skills by 2015
about new ideas and consumer learning requirments are disrupting the whole education eco-system
The US(1) to push forward with Project Tin Can which will set industry-wide e-Learning standards for software
Global Education Expenditure Breakdown by Sector 2012
Global Education Expenditure ($tn) 10.0
: 23.0%
penditure
ng Ex e-Learni
8.0
7 CAGR
2012-201
2-2017 CAGR
iture: 7.4% 201
6.0
IBIS Capital’s hot picks for e-Learning for 2013: next generation content and its creation tools, adaptive learning, collaborative learning, Learning Record Stores (LRS), re-purposable learning, Massive Open Online Courses (MOOCs) and Open Education Resource (OER) management
5.4
50%
4.0
34%
0
2012
2015
2017
Post Secondary
K-12
Global Education M&A Activity Total Deal Value ($bn)
Global Education Fundraising Activity
(2)
(3)
e-Learning as % of Total Volume
130
40.0
Management Systems
Distribution
Customer
20.0
4,000
2,000
13%
0
2007
1.2
2008
2009
Total Deal Value ($bn)
• Regulatory/Curriculum • Corporate Requirements • Consumer Requirements
• Scale • Complexity • Efficiency
• Online • Free/Paid • One-to-One/One-to-Many
• Cost • Level of Qualification • Flexibility
Publishers
Software Platform
Immersive Learning
Content
Tools
MOOCs
Open Source
Smart Technology
Learning Portal
8.5
2010
2011
0
0
2012 YTD
e-Learning as % of Total Volume
Management Systems Content
13%
26%
Education Giants
Company
61%
Content
*
Target Sector
24
Andreessen Horowitz, Charles River Ventures
9.1
75%
UK
15.2
Oct 12
Pearson
Management Systems
US
Founder Collective, IA, Shasta, The Social+Capital Partnership
6.2
37%
US
15.7
Oct 12
Google, Bill & Melinda Gates Foundation and other funding
5.0
74%
Japan
Management Systems
220
US
John Wiley & Sons
Aug 12
IBM
Benesse, Atomico Ventures, Globis Capital Partners
4.1
Management Systems
1,307
Avonmore Developments, Huda Associates, Private Investors
4.7
Aug 12
Higher One Holdings
Management Systems
38
US
Social learning management system
Management Systems
Free education for anyone anywhere
Distribution
Quiz-based e-Learning apps
Content
UK UK
Company
58% 100%
US US
4.2 2.8 2.3
Note: * Client of IBIS Capital All market data as at 10 December 2012 and using historical exchange rates where relevant | Source: IBIS Capital analysis, Learning Light, GSV Education report, Ambient Insight, Microsoft, Consumer Financial Protection Bureau, Annual Survey of Colleges, The College Board, Integrated Postsecondary Education Data System (IPEDS), U.S. Department of Education, National Center for Education Statistics, Babson Survey Research Group, Internet World Stats, McKinsey, Educause, ASTD, Kompass
Distribution
Transaction Value $m
John Wiley & Sons
Distribution
Distribution
Acquirer
Nov 12
Free online university courses
Immersive learning
Transaction Target Date Market Cap. $bn
Investors
30
864
2010
2011
0
2012 ytd
Volume
70%
21%
9%
Recent Fundraisings
HQ
HQ
2009
Management Systems
Education Revenue as % of Total Revenue
Sector
2008
1,349
Distribution
2011 FY Revenue $bn
Overview
999
60
e-Learning Breakdown by Sector in 2012 YTD (Volume)
Recent M&A Transactions
IBIS Capital’s 5 Disruptive Businesses
969
Total Capital Raised ($m)
e-Learning Breakdown by Sector from 2007 to 2012 YTD (Volume)
90
2,366
1,435
2007
87
67
67
65
1,000
4.2
Distribution
Type of Business
20
10.5
10.0
91
3,000
40
20.5
2.4
120
60
47%
30.0
Volume 150
6,000 5,000
56%
Key Affecting Factors
Total Capital Raised ($m)
80
75%
74%
Other
Corporate & Government Learning
68%
Content
8%
4.4
50.0
Industry Overview
Industry Structure
8%
6.3
2.0
e-Learning companies
loa
Current industry hype
Education Expend
US student tablet ownership grew 257% last year and in 2011 technology adapted training has penetrated over 40% of the Global 500 Fortune companies
In Europe alone there are
n $1ntdebt
forecasted out to 2017
Internet users have grown 870% since 2000 massing over 2.4bn users globally and causing an evolutionary shift in how people can engage with the world
2.4bn internet users 6
CAGR
Global Education vs. e-Learning Expenditure Forecasts 2012-2017
650
Transaction Target Date
Investor
Nov 12
VegasTechFund
Oct 12
Academic Partnerships
Distribution
1.8
Oct 12
Charles River Ventures, Andreessen Horowitz
Distribution
15.0
PROfounders Capital
Distribution
4.6
Bill & Melinda Gates Foundation, Retro Venture Partners
Management Systems
3.3
Oct 12 Oct 12
(1) The Advanced Distributed Learning company is sponsored by the US Secretary of Defense and is contributing significantly to Project Tin Can (2) Includes transactions above $20m since 2007 and excludes transactions with undisclosed values. Includes the McGraw-Hill / Apollo transaction, which is still pending (3) Includes fundraisings above $1m since 2007 and excludes fundraisings with undisclosed values
Target Sector
Distribution
Transaction Value $m
9.8