Intel Beefs Up Its Ed Business with Kno Acquisition

KNO-BIG DEAL: Today Intel announced its latest acquisition: Kno, the Santa Clara, CA-based digital textbook startup. Intel has been a backer of the company, having led Kno's $37.5 million Series C round in 2011 with $20 million invested. Kno had raised a total of $73.4 million from the likes of Andreessen Horowitz, First Round Capital and others.

Kno originally offered its own education tablet when it was founded in 2009. But it quickly found itself in direct competition with large tech companies like Apple, which made its own push for the education market with the iPad. In 2011 the company began pivoting to provide a digital textbook service, and accumulated 225,000 K-12 and higher-ed titles through partnerships with 75 educational publishers by the time of sale.

As part of the deal, Intel will bring on Kno's 95 employees--but not its CEO, Osman Rashid. (Coincidentally, before he started Kno, Rashid was the co-founder of Chegg, which is expected to IPO on Wednesday.) GigaOM's Om Malik reports that Kno "sold for literally pennies on a dollar. Well placed sources who were in the know told us that the company sold for $15 million with some retention bonuses for the employees. Intel bought the company mostly for its hardware-related intellectual property and the employees."

The news was first reported by TechCrunch, which surmises that "the biggest chipmaker in the world wants to take on Apple and Google" when it comes to education tablets. Another company worth watching is Amazon, which has been trying to push Kindles into the classrooms and recently acquired TenMarks, an adaptive math content startup.

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