South Africa’s edtech space is booming and Kalon Ventures and Caleo Private Equity want to have a taste of it, too. Both have proceeded to pour $2.5m Series A funding into iXperience, a Cape-Town-based edtech company. By doing so, they have almost equaled Naspers Foundry’s $2.9m investment in The Student Hub last year. An interesting similarity in both deals is that both companies are doing almost the same thing — skills acquisition training.
“The world is changing at an exponential rate and current education systems are not keeping up. We believe that in the next century, learning won’t just be concentrated on youth, but interwoven throughout a person’s life as they transition across careers and life priorities. Our mission is to build immersive and transformational learning experiences that close this gap and give our students the best possible life,” said Aaron Fuchs, co-founder and CEO of iXperience.
The new investment will enable iXperience expand its team, develop its innovative tech platform, launch programmes across different markets, and build its global strategic partnerships division.
Why The Investors Invested
Although Clive Butkow of Kalon Ventures had hinted at iXperience’s team as one of the most attractive qualities of the company, it is public knowledge that the edtech space is booming in South Africa. Earlier this yeat, Naspers CEO Van Dijk said the company’s investments in the edtech space have been some of its most profitable investment adventures.
“It’s one the business lines that we have invested in that I am most excited about. If you look at where the world is going, I think there is huge part of the population in Africa and East Asia that need to be educated, and most of the young people are found between Africa and Asia,” said Van Dijk.
“If you look at the infrastructure in terms of education available in those markets, there aren’t enough traditional schools and higher education institutions to get people skilled up at the scale that is necessary. I think technology will absolutely be necessary to lift the next generation of youngsters into well-skilled, productive grown-ups,” he added.
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But Naspers is not the only investor aware of these immense opportunities in the edtech space. Late year, Cape-Town based edtech startup, Valenture Institute announced it had raised a $7 million investment from GSV Ventures, an investor in leading global edtech platform Coursera. Earlier this year, too, HyperionDev, a Cape Town-based online code course developer, also secured more than £1.8 million ($2m) through its equity crowdfunding campaign on Crowdcube.
Two things common to all those companies are that they are all based in Cape Town and that they are fiercely fighting for market shares in the coding and other skills acquisitions areas, enabled by technology.
Far away, uLesson, a Nigerian edtech startup, has also been making major inroads into East Africa following its $7.5 million Series A round earlier this year. uLesson is backed by some of the continent’s biggest venture capital firms, such as TLcom Capital as well as US-based Owl Ventures, the largest fund focused on the world’s edtech market.
And of course, the team. Investors in iXperience were attracted by the quality of the startup’s team, or so Clive Butkow had said.
CEO Aaron Fuchs had previously worked in the equity markets and so may have some insights into funding opportunities in emerging markets as well as the feasibility of the project. As the former product manager of Prodigy Finance, a platform providing education loans for international masters students, to pursue their dream degrees at the world’s best schools, he can also lay claims to fair industry experiences both in product management and consumer behaviours related to the edtech industry.
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Rai Khan, who also happened to have attended the prestigious Yale University alongside Fuchs, also boasts of long-running experience in the edtech industry.
“Kalon’s decision to invest was strongly motivated by the exceptional quality of the entrepreneurs and innovative technology platform surpassing what’s currently in the market. We are excited for the investment, not only for its potential financial returns, but also for the positive social impact that the company will have in contributing to and driving the digital educational sector,” said Butkow, of Kalon Venture Partners.
“iXperience is a perfect example of the entrepreneur-led, high-growth businesses that Caleo Private Equity loves to support. The company has the leadership and market position to transform its sector and positively influence the lives of thousands of students and other educational stakeholders,’’ added Selwyn Blieden, Joint-CEO of Caleo Private Equity.
But perhaps the greatest attraction for the investors lies in the metrics iXperience flaunts as well as in its innovative product.
The company boasts of over 2500 alumni and claims it works with both organizations and customers to fill the gap between conventional education and the skills that businesses need. To ensure students’ progress in the learning process, it also employs its own proprietary technology platform.
“A key differentiator for us is our ability to create new programs quickly, and that’s largely due to our sophisticated technology,” Khan added.
Both Kalon Venture Partners and Caleo Private Equity are based in Johannesburg, South Africa.
A Look At What iXperience Does
iXperience is an edtech company that partners with high schools, colleges, and corporations to deliver progressive education programs and services that empower students with industry-focused skills.
It was founded in 2013 by Yale University graduates Aaron Fuchs and Rafi Khan.
iXperience began as a coding bootcamp and has since grown to become a market leader in career-focused skills training.
The success of the edtech business can be attributed to the high quality of instructors hired as well as the caliber of students it attracts. Students come from Harvard, Princeton, Stanford, Oxford, and other top foreign universities, according to iXperience.
iX works with institutions to help them stay competitive in an evolving educational and professional environment, in addition to their active direct-to-consumer services.
iXperience has, also, recently established fruitful collaborations with the University of Virginia, WorldStrides, and Bar Ilan University, among others.
iXperience investors iXperience investors
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer