In the fall of 2011, Renaissance Learning found itself in a tug-of-war between competing bidders before being ultimately acquired by Permira Funds, a European private equity firm, at a valuation in the ballpark of $450 million.
That's not the last time that money and control are changing hands for the Wisconsin-based company. Today, Google Capital announced it is investing $40 million in Renaissance Learning at a $1 billion valuation, and will hold a minority stake in the company.
Renaissance has clearly grown since the acquisition. Nic Volpi, a partner at Permira, says in the press release that the company's revenue has "achieved double-digit top-line growth in each of the two years since the Pemira fund’s investment, including 20% in 2013.”
Found in 1984, Renaissance Learning has provided a staple of digital K-12 math and literacy content in classrooms around the world with flagship products like Accelerated Reader and Accelerated Math. The company says its tools currently reaches over 18 million student in over 60 countries around the world, including one-third of U.S schools.
Currently, the company is focused on its assessments and analytics tools. In his Feb. 13 blog post announcing the launch of Renaissance Learning’s redesigned website, CEO Jack Lynch put the spotlight on “state-of-the-art diagnostic systems, treatment and monitoring solutions designed for teachers.”
In an interview with EdSurge, Lynch says the company’s STAR assessment, a series of 20-minute adaptive tests that can plot students on individualized learning paths, is currently the fastest growing product, “at 50% year-over-year.” He also points to Arlington School District in Oregon as a success story, where he claims “three-fourths of the freshmen entering high school have already achieved graduation standards” for math and reading.
Lynch did not confirm details as to whether Renaissance’s content and assessment tools will be integrated with Google’s suite of education apps, Chromebooks or tablets. But Lynch did hint that “we have been working on a deal with Google and expect to complete it over the next several months.”
Announced in May 2013, Google Capital can be seen as a follow-up to Google Ventures, which supports early-stage startups. Google Capital has its target on mature companies, and so far has invested in SurveyMonkey and Lending Club.
“The lion’s share of the investment is in early stage companies which are growing through free-entry models in the K-12 market. It’s been uncommon to see an older company like Renaissance attracting capital. But we’re growing very quickly--and that’s appealing for investors like Google,” says Lynch.