Around the world, the global education industry remains shaped by population growth and access to education, and driven by new technologies and service offerings.

• Solutions for professional education, teacher development, improved online and adaptive learning, and language training (especially English) are always in demand.
• Online learning technology and the need for corporate workforce training drives increases in corporate spending on outsourced training programs.
• Smartphone-only Internet users are reshaping learning models.
• Enrollment in pre-primary education continues to rise as it has proven to show positive long-term results.
• In primary and secondary education, technology investments directly impact school expenditures.
• Higher education is being forced to adapt in the wake of changes to jobs, skills and increasing student debt.
• Learning Management Systems are shifting the teaching focus away from content and onto learners.
• Newer offerings include cloud-based student information systems, digital tools and learning platforms, and data reporting and analytics.

The global education market is expected to be valued at $10 trillion USD by the
year 2030.

M&A Activity

In today’s digitized society, as education becomes more globalized, it presents newforms of private, for-profit involvement. In the global education industry, less than three percent of overall education expenditure is spent on technology. This is expected to increase in the future, yet at an alarmingly slow rate, giving investors a favorable position to get in on
the market.

Mergers and acquisitions opportunities are heavily influenced by the possibilities created by new innovations in digital education, instruction, and credentialing. The global education sector’s biggest strategic performers are diverse companies that continue a shift towards digital services and away from print. Target companies within the education landscape that are in drawing investment include those that provide adaptive learning solutions and assessment products, such as software that facilitates testing and scoring. Other areas that appeal to buyers include education-market-focused infrastructure software and English language learning solutions.

Education Infrastructure Software

Modern education-focused infrastructure software has the power to transform learning environments for students and teachers both inside and outside the classroom by balancing technology across all locations. The approach is comprised of cloud computing, enhanced privacy and security, connectivity, storage, and manageability. Additionally, virtual infrastructure not only simplifies troubleshooting, but it can reduce costs for institutions by reducing overhead through the reduced impacts of having to frequently replace hardware. With support of more devices, teachers can better tailor learning experiences to students learning needs, and a more collaborative learning environment can be created.    

Global English Language Learning Market

The global English language learning market is expected to exceed $22 billion USD by the end of 2025. These programs are in growing demand due to globalization, urbanization, and an appetite for improved education and job opportunities. The escalating numbers for student enrollment in graduate schools in English-speaking countries is deemed to be a primary contributing factor to growth in this market. In higher education, universities in the United States, the United Kingdom,  Australia, and Canada require applicants to pass language tests such as the Test of English as a Foreign Language (TOEFL), Graduate Record Examination (GRE), and International English Language Testing System (IELTS). This drives students to enroll in English language training programs, leading to notable demand for them in countries (such as an India and China) where the number of graduates relocating to English-speaking countries for advanced studies continues to grow at a significant rate.

The global market for digital English language learning is comprised of both regional and international manufacturers. As the international companies expand their reach, improve quality, and lower prices, the regional firms struggle to compete. Such an intensely competitive market for innovation and service extensions increases the number of M&A transactions.

An Industry Continuing to Evolve

Innovation in education requires capital and government funding is limited even in the wealthiest, most developed countries. Private equity and M&A can strategically create and grow companies of scale in the education sector. Larger size means more attractive acquisition opportunities, more prevalence, and more potential for transformation in the industry and its subsectors.

Advancements that are impacting and will continue to impact this industry include:

• Artificial Intelligence, virtual reality, and unified data solutions
• Online education
• Robotics
• Specialized curriculum start-up companies
• Improved curriculum storage and peer-to-peer sharing platforms
• International schools
• Digital classrooms
• Chat bots and voice enabled hardware
• English language training
• Enhanced admissions management and student retention
• Global school networks
• Improved vocational training
• Alternate university models
• Online program managers
• Job training boot camps
• Primary education mobile apps
• Increasing availability and free access to academic publishing resources
• STEM and coding
• Gaming and simulation

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The global corporate training market is projected to grow at a compound annual rate of 9.8% and reach $114 billion by 2022, according to industry experts. Furthermore, a combination of economic, regulatory, demographic and technological forces is reshaping the labour market and forcing employers to increase the speed and efficiency with which they train employees. Meanwhile, ongoing changes in how people consume information and engage with educational content have unlocked new opportunities for innovative training companies to significantly enhance the learning experience. These factors have led to a strong interest in training firms, with much of the interest over the last few years coming from players outside the industry, who wouldn’t traditionally be linked with training.

Some of the high-profile acquisitions coming from adjacent markets include recruitment companies looking to use training as a way to strengthen the marketability of their talent pools and help employers bridge the skills gap. For example, in May 2018, Adecco Group announced it was acquiring General Assembly, which provides courses in web development, coding, and other digital skills. A few years earlier, LinkedIn enhanced its training capabilities by acquiring Lynda.com, an online education company. Penn Foster also partnered with EmployBridge, a large commercial recruitment company, to provide online courses to EmployBridge employees for free.

Furthermore, several factors over the last decade have given employer-sponsored training an increased share in the market. The most significant is that the ever-shortening technology is cycle is accelerating the rate in which certain skills become obsolete. As a result, employers are being driven to make investments in hiring, training, and re-training qualified workers. Increasing regulations and changes to the policy are contributing to the industry, increasing demand for regulatory and compliance monitoring training.

Key Industry Trends

·     eLearning: The increasing use of eLearning has grown to become a multi-billion-dollar market. Factors that have contributed to growth in eLearning include the rising costs of instructor-led, classroom-based training as well as the need for continuous, life-long learning. Awareness and compliance training were two of the first to use eLearning, however sophisticated platforms have made even soft skills training a practical reality for this approach. Add to that the potential for significant cost savings, and it’s not difficult to predict the continued expansion of eLearning for years to come.

·     Training being used to attract and retain employees: Training is increasingly being viewed as an employee incentive, along with perks such as healthcare and retirement benefits. Employees appreciate that access to training will help them hone their skillset – as well as developing new skills. This also helps businesses retain employees, a recent poll found that more than half of all currently employed adults are either actively searching for a new job or are at least passively entertaining other career opportunities. Using training is a way to help develop your employees while keeping them engaged and productive. 

·     Skill gaps continue to grow: According to a report by Payscale Research, 33% of employers had positions open for over six months due to a lack of skilled or qualified candidates. As such, companies must take it upon themselves to provide future employees with the training and development opportunities to meet the demand of the role.

·     Convenience: With the ever-increasing rise of technology, more people are demanding that training is easily accessible. They expect learning to happen at any time, in any place. As the vast majority of people use smart phones, this means they don’t have to wait to access training. 

·     Personalisation: Off-the-shelf training programs are on a rapid decline, employees expect training to be relevant to their unique situation. This means adapting content based on factors such as work environment, the culture within the organisation, employee experience, location, and job performance. With eLearning, there is cause for optimism and excitement in the industry that customised training will become the norm. While training improves, so will company performance.

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Through the year 2023, the global higher education market is expected to grow at a compound annual growth rate of more than 12%. There are several factors driving positive growth in this sector, from the high demand for technological innovations to the surge of internationalization.