Update: As a part of a $19 million third round of funding, Bangalore-based e-learning company TutorVista raised $6.5 million from Lightspeed Venture Partners and Manipal Group, apart from $12.5 million from the Pearson group, VCCircle reports. With this, the total from three rounds of funding since its incorporation in 2006 comes to $38 million. CEO K Ganesh told VCCircle that the company intends to use the money to expand to UK and Australia; they have around 10,000 students in all, 90% of which are from the US.
Original Story (June 25th 2009): Pearson, the media group behind Financial Times and publishing house Penguin, is showing an increased interest in India’s online education sector in the backdrop of an uncertain economy and weakened spending in North America’s K-12 publishing market.
It has acquired a 17.2% stake in TutorVista, a Bangalore based e-learning company, for $12.5 million, VCCircle reported. TutorVista recieved its first round of funding from Manipal Group, and its second from venture capitals Sequoia Capital India, Silicon Valley Bank and Lightspeed Venture Partners. Lightspeed contributed $7 million, while the other two contributed an additional $3.75 million.
TutorVista has 20,000 registered students and offers coaching using online whiteboards and voice over IP (VoIP) primarily to an USA audience. Pearson has plans to include TutorVista’s services to its bouquet of education services for students in North America, the UK and other parts of the world.
Vocational Training With EduComp
Pearson has also set up a joint venture with Delhi-based EduComp, which is listed on the BSE and NSE, to offer vocational and skills training in India. Pearson has acquired 50% stake in Educomp’s existing vocational training business. Educomp has 12 million users in 23,000 schools across India, North America and Singapore.
The JV will offer professional training in financial services, retail and construction sectors. It will focus on English speaking classes which are very popular.
EduComp’s vocational programs include:
Educomp Vocational Education Private Limited, which is in the process of establishing 45 centers and 60 franchisee centers in 18 to 24 months. The company is exploring DTH, IPTV and broadband based access to deliver lessons.
Educomp Tele Education Network, a vocational initiative using satellites for Accountancy Training. It has 25 centres and 40 are expected to be operational by this month.
Language Edge, a program for imparting spoken English and soft skills necessary for individuals seeking employment which was launched during this quarter.
EduComp manages 17 Industrial Training Institutes in UP, Rajasthan, Haryana, Punjab and Delhi and launched five centres to deliver training programs under Rajasthan Mission on Livelihoods. It also has modular employability courses in Punjab.
More on EduComp’s Vocational Services here.
More On EduComp; Q4 09 Financials
Of its various segmented offerings, Smart Class is the largest, contributing to 63.2% of revenues, followed by its Instructional & Computing Technology division which contributes 22.8%. Its teachers training programme, professional development services, which contributed to 9.8% of the company’s FY08 revenues, dropped this year to 5.8%.
The company’s fourth quarter ended March 31,2009. Its consolidated operating revenue stood at Rs. 2264.5 million and net profit was Rs. 553.57 million. EBITDA was Rs. 915.9 million.
Pearson’s Education Strategy
Pearson continues its investments in bolt-on acquisitions in which it has spent $3.3 billion, according to an investor presentation dated June. This year, it acquired Wall Street Institute of English in China for $145 million, National Transcript Centre, Intellipro and is now looking at growth opportunities in markets where education spend is still on the rise. In December 2008, it acquired Fronter, an e-learning portal.