Savvas Learning Company, a Paramus, New Jersey-based provider of K-12 learning solutions, is aiming to “grow exponentially” in supplemental, intervention and assessment services, largely through M&A, said CEO Bethlam Forsa.
The former Pearson [LON:PSON] subsidiary has more than doubled its revenue to USD 1bn since its USD 250m sale to Nexus Capital Management four years ago. Forsa, who has served as the CEO since then, declined to comment on profitability but said the company has “big operating leverage and very desirable margins.”
While Savvas, like other educational publishers, has benefited greatly from the surge in government spending on education since the pandemic, the results under Forsa’s leadership still represent “a phenomenal story,” noted a source familiar with the company. “She has done an amazing job and the growth is mostly organic.”
That said, Forsa stressed that Savvas’ goal now was acquisitive growth, projecting that one to two deals could close this year. It wants to double down on its presence in non-core markets, including supplemental, intervention, and assessment services, she said, adding that this initiative began in the past three years.
Today, non-core solutions – those outside of core subjects like math, English language learning, science and social studies – comprise the fastest growing part of the company, with a compound annual growth rate of more than 50%, she added. Ultimately, the company wants to deliver complete personalized solutions to learners around the world.
Targets could provide “enabling technology” for platform administration and curriculum to support learners and teachers, she said by way of example. The target’s intellectual property, team, and culture are more important factors than size, she noted. Targets in question could offer AI, adaptive technology, algorithms, and research-based processes, she said. Gaming could be of interest along with data analytics around user interface (UI) usage, she said.
Savvas got into the assessment space in recent years, focusing mainly on formative assessment – in which student learning is monitored to provide ongoing feedback for teachers. M&A targets can be focused on identifying each student’s greatest opportunities for growth and more personalized instruction, Forsa said.
While Savvas would be willing to do a transformational deal, Forsa said there may not be many companies of its size available. Although Savvas has no particular geography in mind for deals, she mentioned Central and South America and Asia as “very important” areas of potential growth.
Forsa recently received the ASU-GSV 2023 CEO Power of Women award. Forsa, formerly the president of Pearson’s K-12 division, explained that the award recognized her “successful transformation of a large-scale company.” Its revenue, beyond being doubled, is now more than two-thirds derived from digital content, up from about 40% before the separation from Pearson, she said.
Savvas rebranded in May 2020 just over a year after selling to Nexus. Savvas is the market share leader in core curriculum solutions in the K-12 segment, said the CEO. One in four students learns on the award-winning Savvas Realize platform, which was voted six years in a row as the best K-12 learning management platform, she said.
The company has made only one acquisition since the Nexus investment, that of Rubicon Publishing, a developer of an all-digital math program headquartered near Toronto. Terms were not disclosed. The CEO confirmed that the acquisition came through an auction process, though Savvas already knew the company well. Fisher Company advised Rubicon, according to a press release.
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