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Podcast Transcript Excerpt
Todd: What do you guys see out there in the industry as a whole? We can go back a couple of years and people were predicting that the education industry is a bubble that’s about to burst, but that hasn’t happened. Do you see healthy growth? Or when–and if–there is a downturn, how do you think that will impact the industry?
Chris Curran: I think there is a dramatic amount of venture capital, institutional capital in the early stages growth stage segments that aggregated in these markets domestically and internationally over the last decade.
And you have enormous optionality in terms of product, IT, functionality and utility capabilities in what’s out there. And you have a sea of like-kind solutions all over the map, and every market segment and dimension, that I think we use a lot of optionality for building blocks in pieces and parts to build the next generation of the oligopoly publishers, the edTech oligopoly players, the largest scaled players out there, and creates an emerging lower middle-market to mid-market.
Competitive basis, these things get aggregated and put together, and there’s a lot of different assets to prosecute through in that scenario.
There is also just a dramatic expansion that has occurred over the last decade in terms of where education occurs and resides and how you have access to it, whether it’s online, hybrid, other emerging pathways to access points, products and services that have a learning outcome associated with it.
So the market hasn’t just grown by leaps and bounds in terms of the capital within it in the total addressable market by revenue, it’s grown by segmentation exponentially.
And also I think the other big dimension of that is we’ve been planning for a dramatic growth in international, cross-border transactions for 10 years. And to the extent it occurred up until maybe 2 years ago, it was maybe geocoding a product for customized and localized use case in another locality.
Maybe it was capital that was in the syndicate investing in something but never left North America. As a use case, that’s really changed dramatically in the last couple years, particularly looking at the number of R&B funds flowing into US dollar assets and acquisitions that are coming out of China.
New USD fund formations that are occurring there inside and alongside some of the largest strategics.
Same is happening in other emerging markets. There is a lot of the global phenomena of education where the hedge of an asset that’s growing stable in one market that might have application in another geography is beginning to really happen at a compounded pace.
So we believe macroeconomic trends, good, bad or the ugly in the US, the education market is always going to be a stable and high-volume transacting market segment.