Update on EdTech Market Valuations

Other than a few companies, the stock market continues to punish EdTech firms

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Several of our recent posts has indirectly touched on market valuations for EdTech firms.

As you well know, this is not a financial analysis newsletter. However, the size and scope of the market downturn for EdTech is relevant for vendor strategy and for the financial health of publicly-traded companies. This means that it is a good time to update our summary of market valuations, last updated in December.

The approach I’ve taken is to compare the market valuations to the date of Coursera’s Initial Public Offering (IPO) in late March 2021, as that date best captures the previous peak of exuberance. This is not the same as the peak valuation for all companies, as 2U’s maximum occurred in May 2018, but it does capture an overall market moment of comparison.

Keypath, Instructure, and D2L had their IPOs after Coursera, in June, July, and November 2021 respectively. I used the IPO valuation as the comparison point for those three.

If you look at stock prices as of Wednesday of this week, you can see overall performance from March 2021 to August 2023. Only Instructure (29%), Pearson (14%), and PowerSchool (9%) have increased in this time period.

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