A prominent edtech company is taking out a super-sized checkbook to stretch its services across what it calls the "career curriculum continuum."
2U announced Monday that it will acquire coding bootcamp provider Trilogy Education Services for $750 million in cash and stock.
Lanham, Md.-based 2U, which makes online courses for educational institutions, will nearly double its count of university partners following the deal, from 36 to 68.
Trilogy provides in-person and online training programs in coding, data analytics, UX/UI and cybersecurity in more than 50 cities worldwide.
The move adds those bootcamps to 2U's mostly university-level portfolio, extending its reach farther outside traditional classrooms: It now encompasses short courses, in-person and online boot camps, professional certificates and graduate degree programs.
“Increasingly, universities are attempting to add practical, technical skills to their degrees. We simply future-proof the degree by adding this type of technical competency,” co-founder and CEO said Chip Paucek said in a statement. "We expect the addition of Trilogy to accelerate our path to $1 billion in revenue by one year from 2022 to 2021.”
2U debuted on the Nasdaq 11 years ago, and since then has tallied 16,000 graduates from programs it created.
In 2017 it bought GetSmarter, which added master's level short courses on technology and functional skills to its services. Last year, it launched its first master’s level professional certificate – the Harvard Business Analytics Program. And the momentum kept growing.
In 2018 alone, students from 150 countries took more than 30,000 short courses made by 2U and the HBAP program attracted nearly 400 students.
Since its founding in 2015, New York-based Trilogy has enrolled 20,000 students in programs and graduates have been hired by more than 2,250 companies, according to the startup – including Google, Microsoft and Bank of America. And the number of Trilogy-powered programs has skyrocketed since early 2018, from 53 to 120.
2U secured $250 million in debt financing from Owl Rock Capital, which combined with the company's cash on hand will fund the $400 million cash portion of the deal. The acquisition isn't subject to shareholder voting and is expected to close within two months.
The combined company will retain "substantially all" current Trilogy employees, according to a statement, and enter into new employment agreements with key members of the management team.
UNC Kenan-Flagler signed on as 2U's first partner to offer Trilogy-powered bootcamps for credit in their MBA program, and it will embed technical competency into its existing short courses.
The marriage is a big win toward 2U's goal of "eliminating the back row in higher education," Paucek said in a LinkedIn post: "Every day’s a holiday, every meal’s a feast."
