Online tutoring: what next for Tutorvista?

Pearson’s acquisition of Tutorvista made the news last week. I the light of this, what next for this business and for online tutoring in general.

Online tutoring as received a fair amount of funding in recent years. This is a relatively new market-space, with Tutorvista only 5 years old. Until recently there were six VC funded online tutoring businesses: Tutorvista (who raised $80.8m), Globalscholar ($42m), Grockit ($17.7m), Cramster ($9m), ($13.5m) and Edufire ($1.7m).

In the period Oct ‘10 to Jan ‘11 four of these businesses were subject to trade sales:

  • Tutorvista was acquired by Pearson (business valuation $215m)
  • Global Scholar by the Scantron Corporation ($140m)
  • Cramster by Chegg (value undisclosed)
  • Edufire was also sold to Camelback Education Group (price undisclosed)

Only Grockit and remains unsold.

Assuming that the acquiring businesses wish to grow these businesses, we should expansion particularly in the US. Interestingly, Pearson says that it is more interested in the growing markets. John Makinson, chairman of Pearson India said that the “acquisition underlines Pearson’s commitment to education and skills development in India. The investment in TutorVista gives us control of the world’s largest online tutoring business and, crucially, a solid platform on which to build a leading presence in the Indian private schools sector.”

Integrating small technology based businesses in large corporates puts stresses on the acquired companies. These businesses require further investment and they will be judged shoulder to shoulder with existing and known business units. So whilst there is great scope for expansion, we’ll have to wait and see what actually happens.

In the meantime, Venture Capitalists will be interested in this segment, particularly in traditional markets like the UK. Have I told you about Tutorhub?