ETCH Weekend Reading 2/12/24
Affordable childcare bills, school choice, standardized testing, and administrative bloat
Congrats to the Kansas City Chiefs for winning yesterday’s Super Bowl. They Shook Off a halftime deficit and won on a Fearless pass by Patrick Mahomes. We can only hope that their championship rings will be Bejeweled in a way that never goes Out of Style.
On to the news!
Funding / M&A
Colossyan raises $22M / UK, Corporate Training (Publishing Infrastructure) / Lakestar, Launchub, Day One Capital, Emerge Education
Harbor raises $3.7M / US, Childcare / Trust Ventures, Morrison Seger, Capital Factory
Simplify raises $3M / US, Jobs Platform / Craft Ventures, Y Combinator, Hyphen Capital, GFC
Adventum raises $3M / India, International Student Placement / Brand Capital
ConveGenius raises $1.8M / India, Chatbot / Searce Inc.
Leya AI raises €1M / Lithuania, Tutoring / V-Sharp Venture Studio, Inventure, BADideas.fund
Klas raises $1M / Nigeria, Course Platform / Ingressive Capital, Techstars, HoaQ
Google acquires Edlyft / US, Tutoring
Savvas Learning (FKA Pearson K12) acquires Outlier / US, Content Publisher
Quantum5 acquires Trivie / US, Assessments
SnapDragon Capital acquires Mathnasium franchisee / US, Tutoring
To be named in this newsletter, a company must raise $1M+ with verifiable institutional investors, be part of an acquisition where the combined entity has > 50 employees, or raise a VC/PE fund of $10M+
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Kelly Sia promoted to President of Curriculum Associates / via Curriculum Associates
David Longo promoted to CFO of Chegg / via Yahoo Finance
Chris Bondarenko joins 360Learning as Chief Revenue Officer / via businesswire
Grammarly lays off 230 / via Techcrunch
Note: Grammarly is more EdTech-adjacent than pure EdTech, but the company’s AI-focused restructuring narrative is something to keep an eye on. (Caveat that press quotes/releases, especially ones concerning layoffs, always have a degree of “spin” to them.)
Affordable childcare becoming a bipartisan issue. As the father of a 6-month-old paying more for childcare than I do for rent, this trend is exciting. As an industry analyst, it also provides an insightful view of changing political priorities. From North Dakota Republican Emily O’Brien, who championed a $66M state spending bill focused on childcare investments, “It was definitely not, you know, an easy sell, because this is probably somewhere where you don’t want the government to get involved, but it’s a workforce solution. We have people that are willing and able to work, but finding child care was an obstacle.” / via Associated Press
Further evidence that school choice is the K12 education topic in this US election year - 70% of parents support implementation of school choice policies. The wrinkle? Teachers’ unions, and those who count on them for contributions and voting support, say school choice “undermines democracy.” / via Real Clear Education
To be clear, I am not opining on whether school choice is good or bad. I am showing you the shape of the battle lines for this election cycle, like Alabama Governor Kay Ivey’s $100M ESA plan. / via AL.com
Higher ed, but also related to this election cycle, FAFSA applications down 57% YoY amid rocky rollout of new technical infrastructure. Education Department allocates $50M and 50+ staffers to help colleges. / via Higher Ed Dive and Inside Higher Ed
Explaining California’s $2B Pandemic Recovery settlement. / via New York Times
Dartmouth reinstates standardized tests for admissions. Dartmouth found that having test scores (SAT/ACT/etc.) *in addition to* other components of a student’s application led to a better admissions process. These tests are not perfect, but they are helpful and available at scale for schools to use. / via Financial Times
Like standardized assessments, accreditation is a tricky topic. While accreditation is time-consuming and expensive, today’s accreditors do provide a baseline level of protection for student (and taxpayer) funding. Any attempt to make accreditation “easier” should be met with skepticism.
However! I am interested in models that are “different, but still rigorous.” The Postsecondary Commision, profiled here, fits that bill. / via Inside Higher Ed
And! Perhaps counterintuitively, I am also interested in models that do not participate in the accreditation system at all (and, thus, do not take Title IV funding). Buildspace, who published their most recent investor update this week, is one of my favorite organizations in this category. / via Buildspace
AI can’t read. Why pay attention to its feedback on writing? I was previously…unhappy with this author’s post “Arizona State announces a plan to give up on education.” I found this post much more insightful and self-aware in trying to examine the true purpose of providing feedback - whether human or AI-generated. / via Inside Higher Ed
Rot, from provocateur and professor Scott Galloway. “Administrative bloat,” the subject of the “rot” in this essay, is an easy punching bag. As universities grew in both revenue and stature over the 20th century, they increased non-academic headcount. / via No Mercy, No Malice
It is also a naive position, akin to disparaging Google for employing people who don’t work on Search. Galloway and other bloat-accusers fail to acknowledge that education is just a component of today’s universities - they are hospitals, research labs, professional sports franchises, hospitality companies, real estate companies, and, of course, hedge funds. They are non-profit conglomerates.
Whether universities should be conglomerates is a fair question. Poor financial management like the $177M budget deficit that the University of Arizona managed to run this year suggests that not all universities are great stewards of capital. But arguing that universities should get rid of non-academic employees misses the forest for the trees. / via Chronicle of Higher Education
Some other recent examples of universities operating outside the strict confines of academia (for better or for worse):
How and why the University of Michigan built its own Generative AI tools. This is a case study worth reading by both university and corporate leaders. The question to consider while reading: What level of (resource-intensive) customization makes sense for your organization? / via Educause
Butler University to build new housing for students and alumni. We often talk about how universities increase the long-term value of their students/alumni by offering online courses, why not also offer housing? / via Butler University
Paul Fain covers the declining labor force participation rate, now down to 62.5%. Something to keep an eye on. / via The Job
This email, ETCH Weekend Reading, is ETCH’s free newsletter providing links to the week’s EdTech Funding, M&A, People moves, and a curated list of Links to relevant industry news. If you enjoyed this edition, I hope you will subscribe and/or forward to your friends!