Scottsdale-based Imagine Learning is launching a new venture fund to back startups leveraging artificial intelligence in the education sector.
The education technology company announced Wednesday that it created Imagine Learning Ventures to compliment its AI development initiatives by “investing in startups at the forefront of innovative products” for educators and students.
“We launched this fund to make investments in small companies with big ideas, or even pre-company ideas we think are promising and want to have a front row seat to watching them develop, so we can learn about things that work and things that don't work,” Jonathan Grayer, founder and CEO of Imagine Learning, told AZ Inno. “We can help those companies with our knowledge and experience because we're doing it on a big scale. We want to be everywhere in the sphere of artificial intelligence as it relates to learning.”
The new venture fund will leverage Imagine Learning’s industry expertise and healthy balance sheet to deploy millions of dollars into startups with emerging AI technology, according to a company release.
Imagine Learning Ventures is backing the fund with its own capital rather than look outside for limited partners, Grayer said.
“For this kind of investing, we can fund it off our balance sheet and that's what we're doing. We're funding it ourselves," he said. "There's no LP involvement."
Imagine Learning’s ownership consists of Grayer and private equity firms Silver Lake, of Menlo Park, California, and Onex Corp., headquartered in Toronto, Canada.
Grayer declined to disclose the total amount of the fund, stating there isn't a specific limit for investment amounts.
Imagine Learning Ventures will likely invest in 10 to 20 companies nationwide, with funding round participation and check size to be based on a per company basis, Grayer said.
“We are laser-focused on creating educational technology that does the heavy lifting so that teachers can do their most important work — interacting with students to ensure their academic success,” Grayer said. “The responsible use of AI means that we must always serve the teaching and learning goals, empower educators, follow sound pedagogy, and ensure that our solutions are safe for students and free from bias. We are excited about Imagine Learning Ventures and the opportunities ahead.”
Imagine Learning to open new Tempe HQ
In May, Imagine Learning announced plans to relocate its global headquarters to 100 Mill in downtown Tempe. The company will occupy 31,000 square feet on the 17th floor of the building with an anticipated move-in date of February 2024.
Imagine Learning currently occupies more than 50,000 square feet at the Chaparral Business Center in Scottsdale, the Business Journal previously reported.
Grayer founded Imagine Learning in 2011 after purchasing e-learning company Education2020. Grayer is the former chairman and CEO of global educational services company Kaplan Inc., which is headquartered in Fort Lauderdale, Florida. During his tenure with Kaplan, Grayer grew the company's revenue from $80 million to $2.3 billion.
Imagine Learning is one of the largest digital curriculum providers to K–12 schools in the U.S., serving more than 15 million students, according to the company.
The company has nearly 2,600 employees in the U.S. and Europe with more than 350 workers based in Arizona.
Imagine Learning Ventures will announce investments in companies at a future date, but it has already engaged in discussions with dozens of startups, Grayer said.
“We are a national business. Our biggest customers are large, urban school systems in Los Angeles, Philadelphia and all over the country,” Grayer said. “We would love to do a major investment in an Arizona-based company, but it's about the idea, the people and the value proposition before anything else because that's what we're in the business for.”
