US-based 2U, a digital education platform for colleges and universities is set to acquire South Africa’s GetSmarter for approximately $103 million in a move expected to strengthen its position in the approximately $1.9 trillion global higher education market.Both 2U and GetSmarter focus on delivering high-quality, high-touch digital higher education from world class colleges and universities to unlock a student’s full potential.
According to Christopher “Chip” Paucek, CEO and co-founder of 2U, “With GetSmarter, 2U expects to strengthen its position as a leader in digital education. We also expect to accelerate our growth, extend our global footprint and provide a broader suite of services by matching up more students to the right programs at the right time as they further their professional and personal development.”
GetSmarter’s partners include the University of Cambridge, Harvard University’s strategic online learning initiative, HarvardX, Massachusetts Institute of Technology (MIT), and Africa’s top three universities, University of Cape Town, University of the Witwatersrand and University of Stellenbosch Business School. With over 50,000 students since inception and an 88% average course completion rate, GetSmarter was a right fit for 2U.“In 2U we have found a partner who makes us stronger. They bring deep experience and access to capital that allows us to pursue stellar growth and stand out student outcomes at scale.” said Sam Paddock, CEO and co-founder of GetSmarter. “We look forward to better serving our University partners and their students across the globe.”
Following the closing of the acquisition, GetSmarter will be an independently operating, wholly-owned subsidiary of 2U, based in Cape Town, South Africa. GetSmarter will continue to be operated by its current management team, including its founders, Sam Paddock and Rob Paddock, with GetSmarter co-Founder & CEO, Sam Paddock, remaining as its CEO and reporting to Chip Paucek.
2U will pay approximately $103 million in cash upon closing for all outstanding equity interests in GetSmarter, with up to an additional $20 million in cash payable to the equity holders of GetSmarter upon the achievement of certain financial milestones in calendar year 2017 and 2018.
In addition, 2U will provide certain members of GetSmarter’s senior management team with approximately $9.4 million of restricted stock units in the aggregate, subject to the continued service of such individual to GetSmarter following the closing.
Globally, Edtech is getting so hot with technology seen as the future of education delivery in the next few years. South Africa’s Naspers is also banking heavily on the future of education with the investment into Codecademy and Udemy only time will tell if it will reap out of education as it has from its believe in the internet from its old newspaper days.