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Sydney-based OpenLearning (ASX: OLL) is acquiring three online higher-education marketplaces that together support 800,000 users and are expected to be earnings positive for the group.
OpenLearning, which operates an AI powered Software-as-a-Service (SaaS) platform, is buying the marketplaces from Prosple for $300,000 in a capital-light deal that the edtech says will increase its product offering and boost its subscriber base.
Prosple, formerly known as GradAustralia, helps university students find a job after graduation. The websites acquired by OpenLearning - PostGradAustralia.com.au, TheUniGuide.com.au and StudyNewZealand.nz - have been key product offerings for Prosple since the company was launched in 2015.
However, Prosple is selling them to focus on its fast-growing internship and graduate portal.
"We are excited about the opportunity to acquire these value-accretive online higher education marketplaces,” says OpenLearning CEO Adam Brimo.
“This acquisition will enhance our platform's value proposition, diversify our product mix and provide exciting cross-selling opportunities.
“We have seen growing interest from education providers in the past year to leverage OpenLearning to promote their courses, hence these marketplaces are highly complementary to our current platform offering.
“We look forward to working with Prosple to complete the transaction within the agreed timeframe.”
The three marketplaces, which together attract more than 800,000 users and list over 15,000 courses and degrees from 70 institutions, are described by OpenLearning as ‘profitable, generating revenue from listing fees paid by higher education providers to promote their institutions and courses’.
Customers include Australian universities, private higher education colleges and registered training organisations.
The acquisition is part of a turnaround strategy initiated by OpenLearning in 2022 with a focus on growing its subscription platform in new and existing markets.
Founded in 2012, OpenLearning provides an online learning platform to education providers that covers short courses, micro-credentials and qualifications, as well as a global marketplace of courses for learners.
When announcing the company’s half-year results in August, Brimo said OpenLearning is being transformed into an ‘AI-powered SaaS platform for lifelong learning’.
“We believe it is one of the best learning platforms in the world with solid foundations for sustainable growth,” he said at the time.
OpenLearning grew SaaS platform revenues by 16.9 per cent in the June half compared to a year earlier.
However, a 35.9 per cent drop in revenue for the period to $1.052 million reflected the sale of its underperforming learning services division.
OpenLearning posted a net loss of $2.23 million for the June half year, an improvement of 29 per cent from a year aearlier.
In a third-quarter update issued in October last year, OpenLearning revealed it had grown its SaaS customer base by 6 per cent to 231 and total users to 3.5 million. This was accompanied by an 11 per cent increase in annual recurring revenue to $1.88 million.
Over the past year, OpenLearning established a presence in India through a distribution and SaaS reseller agreement with Education Centre of Australia (ECA).
The company is also making inroads in Vietnam and Malaysia, with a geographic expansion strategy and the reseller model seen as key to ‘accelerating the pace to break-even’.
The company says the acquisitions from Prosple are expected to be finalised over the next three months.
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