online education

Gauge Invests in eDynamic

by

Gauge Capital has made an investment in eDynamic Learning, a provider of online education courses.

eDynamic Learning is a provider of online career and elective courses serving the virtual, blended, and brick & mortar US middle and high school market. The company offers over 70 courses segmented within 16 career clusters ranging from Forensic Science to Gothic Literature. eDynamic was founded in 2008 and is based in Kelowna, BC (www.edynamiclearning.com).

“This is an exciting time as we partner with Gauge Capital to drive the next chapter of success for our company. This relationship promotes expanded product offerings, increased market share, and accelerated growth. We are excited to begin the relationship with Gauge, a company with experienced professionals, a proven track record, and an extensive network within the education industry,” said Kevin Viau, CEO and Founder of eDynamic.

“We are excited to partner with an industry leader and support the company’s mission of providing students access to a diverse set of career and elective courses,” said Tom McKelvey, Co-Founder and Managing Partner at Gauge Capital. “eDynamic has become an industry leader through developing courses that are engaging, relevant, and high quality. Since we were first introduced, we have been impressed with Kevin and the company that he and the rest of the eDynamic team have built. Kevin is a fantastic operator and we are confident that together we will be able to realize our shared vision for what eDynamic can become.”

As part of the investment, Tom McKelvey, Drew Johnson and James Jackson from Gauge Capital have joined the company’s Board of Directors. Kevin Viau will continue to serve as the company’s CEO and as a member of the Board of Directors.

Financing for the transaction was provided by Fort Worth, TX-based Crestline Investors (www.crestlineinvestors.com).

Gauge Capital invests from $10 million to $40 million in North American-based companies that have $5 million to $30 million of EBITDA. Typical transaction types include buy-outs, recapitalizations, divestitures, privatizations, consolidations, and growth capital investments. Sectors of interest include healthcare services, business services, consumer and food. The firm will consider both majority and minority investments. Gauge Capital is based near Dallas in Southlake, TX (www.gaugecapital.com).

In March 2017, Gauge Capital held a final closing of Gauge Capital II LP at the fund’s hard cap of $500 million. The firm’s inaugural fund, Gauge Fund LP, closed in October 2014 at its hard cap with $250 million of capital commitments.

© 2017 Private Equity Professional | May 18, 2017

Stone-Goff Sells Learners Edge

by

Stone Goff Partners has sold its portfolio company Learners Edge to L Squared Capital Partners. Stone Goff acquired Learners Edge in September 2013.

Learners Edge is a direct-to-teacher provider of online professional development, continuing education and master’s degree programs for K-12 teachers. Teachers use the company’s products to satisfy their teacher certification requirements or to move up their salary scale within their school district through additional education. Learner’s Edge partners with academic institutions such as Augustana College, Aurora University, Colorado State University-Pueblo, Marygrove College, Pacific-Lutheran University and Lourdes University to provide degree-eligible credits to teachers.

According to Stone-Goff, Learners Edge is the largest online direct-to-teacher continuing education provider in the US. The company was founded in 2002 by two middle-school teachers, Joe Cotter and Kyle Pederson and is based near Minneapolis in Lakeville, MN (www.learnersedgeinc.com).

“The Learners Edge team – led by CEO Joe Cotter – developed a clear, mission-driven approach for the development and dissemination of continuing education for teachers. Our successful exit is a testament to the value created by the management team since our investment and demonstrates the company’s strength in helping on-the-ground teachers improve classroom instruction and student learning,” said Hannah Craven, co-founder of Stone-Goff Partners. “As the company’s first outside investor, we are honored to have been able to partner with Joe, Kyle, Julie Yaeger, Jenny Oelkers, Mark Hrubes and the entire Learners Edge team.”

Stone-Goff invests from $6 million to $20 million of equity in lower middle market companies that are active in the consumer, leisure, information, service, media and retail sectors. The firm was founded in 2010 by Hannah Craven and Laurens Goff and has offices in New York and Boston (www.stonegoff.com).

Avante Mezzanine Partners backed Stone Goff’s acquisition of Learners Edge in September 2013 by providing both a senior unitranche financing and an equity co-investment. Through the sale to L Squared, Avante generated a 43% unlevered (Avante is an SBIC) compounded annual rate of return on its investment. Avante also participated in L Squared’s transaction by providing a portion of the debt financing and co-investing in the equity.

“Under the leadership of CEO Joe Cotter and his terrific team, Learners Edge has enjoyed strong organic growth and solidified its position as a leading continuing professional education provider for teachers in this country during the last three years,” said Avante Managing Partner Natasha Fox.

Avante Mezzanine provides unitranche/one-stop debt, mezzanine, and minority equity investments of $5 million to $25 million to sponsored and non-sponsored companies with EBITDAs from $3 million to $15 million. Sectors of interest include aerospace and defense; business services; consumer products; distribution; education; healthcare and life sciences; industrial manufacturing; security products and services; software and IT services; and specialty chemicals and coatings.  Avante has offices in Los Angeles and Boston (www.avantemezzanine.com).

L Squared Capital Partners,the buyer of Learners Edge, invests from $15 million to $75 million of equity in technology-enabled services, industrial technology, and education companies.  Targeted investments will have revenue of $10 million to $100 million and EBITDA of $3 million to $20 million.  The firm was founded in 2014 and has offices in Newport Beach and Chicago (www.lsquaredcap.com).

George K. Baum Capital Advisors (www.gkbcapitaladvisors.com) was the financial advisor to Learners Edge on this transaction.

© 2016 Private Equity Professional • 9-30-16