Education management provider K12’s $165 million acquisition of coding boot camp Galvanize helps to highlight the new direction education technology is going in. K12’s flagship business has so far centered on operating and managing online schools for school districts. The publicly traded virtual schooling and ed-tech company is now looking at a dramatic expansion as it looks to break into the corporate learning and career readiness market.
It’s not the first time that an education boot camp has been gobbled up by an education technology company. This type of acquisition is becoming the norm as bigger companies in the sector look to consolidate their holdings, grab a larger market share, and eliminate competition.
For boot camps like Galvanize, this is good news, since it means a substantial influx of funds for future endeavors. With the new funding, the Denver-based company plans to expand its services and grow its corporate learning business.
In the last 10 years, over 400 coding boot camps raised more than $1 billion in venture capital globally. Some of these notable deals include 2U’s $750 million acquisition of Trilogy Education; Swiss Adecco Group’s $412.5 million purchase of General Assembly; Chegg’s $80 million for Thinkful; and Zovio’s $17.5 million for Fullstack Academy.
K12’s acquisition of Galvanize will help propel its hybrid high school and career training program. Galvanize’s mix of online and in-person learning will provide the perfect platform to do so.
Galvanize offers technical training in areas like data science and software engineering. The fact that over 80% of Galvanize graduates get into their dream jobs within a year and over 8,000 of its students work at top MNCs will serve as a strong points to expand business, too.
To date, K12 has been known more for the educational software and services it provides to run online schools. The Galvanize acquisition will be a valuable asset for K12’s Destinations Career Academies. It will also bring in much-needed revenue for sources other than the struggling legacy business. There is also a possibility of licensing Galvanize curriculums to universities and schools, which will add to K12’s revenues.
Acquisition of boot camps has a lot to do with filling in skills gaps for coding and other new digital skills. Students need more than a degree today, and coding boot camps remain a popular alternative and serve as a supplement to traditional college and university degrees. Students need to master skills that will make them “job ready” for in-demand professions. Boot camp graduates, as mentioned above, go on to work for companies like Google, Amazon, Facebook, Microsoft, and JPMorgan Chase.
The growing trend of acquisitions has morphed the original boot camp model into a variety of formats and business models, mostly towards a B2B one. One area of service is for universities who wish to fill curriculum gaps, improve graduate employability, and supplement continuing education revenues. The other, perhaps more profitable, area is for the corporations who need to up-skill their workforce via smart and quick courses in online and blended options.
