Higher edtech platform Simplilearn, promoted by private equity firm Blackstone, has bought US-based bootcamp education company Fullstack Academy as it looks to strengthen its business in North America. The acquisition comes at a time when competition in the higher learning and upskilling space is intensifying amid a downturn in online learning.
Simplilearn has bought Fullstack in an all-cash deal from its US-based publicly traded parent entity Zovio Inc. Zovio Inc has been trying to hive off Fullstack since September. According to Zovio Inc’s filings with the Securities and Exchange Commission (SEC) on September 20, it was looking to garner $34-$55 million from the sale of Fullstack. However, Simplilearn did not disclose the value of the transaction.
The acquisition of Fullstack will give Simplilearn access to over 20 university and government partnerships across the country, Simplilearn said in a statement on November 28. Fullstack Academy is a premium bootcamp provider that also has offerings in web development, cybersecurity, product management, DevOps, data analytics, among others.
Fullstack’s acquisition will also help Simplilearn to scale its presence in the bootcamp space and drive revenue growth to $200 million by FY24 (2023-24), of which 70 percent is likely to come from global markets, the company said.
Simplilearn reported an operating revenue of Rs 479.7 crore in FY22, up from Rs 340.9 crore in FY21. In a recent media interview with Mint, Krishna Kumar, founder and CEO (Chief Executive Officer) of Simplilearn, had said that he expects the company’s revenue to top Rs 1,000 crore in FY23.
Fullstack Academy has over 300 employees spread across the US, Simplelearn said, adding that Fullstack is expected to top $30 million in revenue this year. Following the transaction, all Fullstack Academy employees will remain in their roles as part of the combined organization, taking Simplilearn’s total employee count to over 2,500, Simplilearn said.
Fullstack Academy will continue to serve its students and partners as an independent business unit within Simplilearn.
“Bootcamps have been an extremely popular concept in the edtech industry, and there is no denying that learners are looking for the holistic learning experience that bootcamps offer. Through Fullstack Academy’s wide-spread footprint in the U.S. and its strong partnerships with top universities, we are confident that this collaboration will enable us to accelerate our global expansion plans,” said Kumar.
“It is amazing to find a business whose vision is similar to ours and complements our pedagogy and belief system. We are certain we will be able to leverage each other's capabilities synergistically to build a strong company,” Kumar added.
Fullstack will be Simplilearn’s second acquisition since 2015, when it bought Market Motive, a platform that trains working professionals on digital marketing. Simplilearn claims to have grown more than 60 percent in the past year. Earlier this month, it raised $45 million in a new funding round led by GSV Ventures at an undisclosed valuation.
Founded in 2010, Simplilearn offers digital skilling programs for professionals, enabling them to upskill and get certified in fast-growing digital domains.
The company creates these programs in collaboration with educational institutions including Caltech CTME, MIT Schwarzman College of Computing, UMass Amherst and the Isenberg School of Management, Purdue University, Wharton Online, IIT-Roorkee, and IIT-Kanpur, and companies such as IBM, Microsoft, Amazon, Meta, and KPMG.
Simplilearn claims to have added more than 1.2 million paid business-to-consumer (B2C) learners, and more than 1 million enterprise learners on its platform. It also claims to have more than 2 million free learners on its SkillUp platform. In July 2021, Blackstone acquired a majority stake in Simplilearn.
Simplilearn joins a growing list of higher edtech platforms to step up acquisitions this year. Ronnie Screwvala’s upGrad has been on an acquisition spree this year and has bought more than 12 companies.
Tiger Global-backed upskilling platform Scaler, too has earmarked $50 million for mergers and acquisitions this year. SoftBank-backed Eruditus, meanwhile, had raised $350 million in acquisition financing from Canada Pension Plan Investment Board (CPPIB) earlier this year. In a media interview, Ashwin Damera, Eruditus’ founder and CEO, had said that the company would earmark $1 billion for acquisitions in 2022.