Earlier in May 2017, we reported that NASDAQ listed 2U Inc. had announced their intention to acquire South African EdTech company, GetSmarter, for $103 million in an all cash transaction.
"2U's investment in GetSmarter - more than R1.4 billion ($103 million) - is a tremendous vote of confidence in South Africa and in Cape Town. We could not have got to where we are without our talented workforce of young South Africans, who are dedicated and skilled professionals, committed to making professional education widely available," said Paddock as he explained the acquisition to iAfrikan.
Despite the acquisition amount of $103 million, which Paddock agrees makes a tremendous statement, he also mentioned that "the fit between our companies - strategically and culturally - was too good to ignore," and this is what also ultimately led to the acquisition being agreed to.
"Both executives decided that the acquisition would better serve all our stakeholders - employees, students, University partners, and shareholders,".
L-R: Sam Paddock (Co-founder and CEO at GetSmarter) and Robert Paddock (Co-founder and Chief Academic Officer at GetSmarter) in New York.
GetSmarter provides online short courses which they offer in partnership with some of the world's most renowned higher education institutions such as the University of Cambridge; the London School of Economics; Harvard University's strategic online learning initiative, HarvardX; the University of Chicago; Massachusetts Institute of Technology (MIT); and Afrika's top three universities: University of Cape Town, University of the Witwatersrand and University of Stellenbosch Business School.
Despite the acquisition by 2U, GetSmarter is set to remain as an independent subsidiary of the American digital education company.
"GetSmarter will maintain its mission and identity as a wholly owned subsidiary of 2U. For now, we will continue to focus on premium short courses for working professionals in 150 countries around the world. Given the similarity of our mission and cultures, we expect synergies over time. But it's simply too early to know exactly what that will look like," said Paddock.
The South African EdTech company is also reported to have over 50,000 people enroll for their online courses, and more interestingly, the company has above average online course completion rates of 88%, better than the course completion rates of many MOOCs.
Paddock didn't shed much light on whether the acquisition means GetSmarter will be expanding into more territories or offering complimentary services to 2U but he explained that 2U's expertise and support will enable them (GetSmarter) to expand their offerings of premium short courses for working professionals.
"2U believes that we can continue to build on these foundations. We expect their confidence will ignite Cape Town as a hub of digital innovation, creating significant opportunities for other businesses and boosting our economy," concluded Paddock.
What is notable about GetSmarter is how it is not only targeting Afrika as a market but already has customers, universities, outside the continent as clients. This puts them in a special league, of not only one of the largest Afrikan tech exits, but also as one of the few technology companies that export technology developed in Afrika to the rest of the world.