Edtech up-skilling platform Degreed has acquired Learn In, which creates talent resource hubs for employers to better spin up education services for their teams. While we’d nearly always cover a notable acquisition in a relevant tech sector, the extra interesting bit here is a personnel one: both companies were co-founded by the same entrepreneur, David Blake.
It feels rare to see serial entrepreneurs have one of their startups acquire another one of their startups. Part of the reason is that there can be a conflict of interest, or power imbalance, when making decisions. After all, most people agree with themselves. For example, Tesla shareholders somewhat famously sued CEO Elon Musk when Tesla acquired SolarCity, where Musk was also chairman and the largest shareholder. (They accused him of bailing out the solar installer; a judge later determined that Tesla didn't overpay for the company.)
Blake said that he disclosed all conflicts and recused himself from representing Degreed during the negotiation process. He solely represented himself as the CEO of Learn In, while Degreed’s board of directors represented the other side. Even still, it’s hard to completely extract bias from any financial deal, particularly one as tangly as this -- the two companies have shared investors including GSV, Firework Ventures and Album VC.
Blake declined to share the price or terms of the deal.
The entrepreneur also emphasized that, despite co-founding Degreed, he’s spent the past few years in a “different, more distant role” within the company as an executive chairman. “I was closer and more involved in operations than the rest of the directors but it was in a board member capacity,” he added. Degreed approached Learn In, and the deal closed in less than a week, he said.
Blake started Degreed in 2012 to give individuals a platform to turn to for open access educational content. The high-volume, mixed-quality platform was eventually what edtech now refers to as a learning experience platform, all about discovery of content.
Blake stepped down as CEO from Degreed to do political advocacy and democracy reform. After his two-year stint in organizing, he says he became "fascinated with the paradox around upskilling," which he described as somewhat lacking within companies despite offering a massive ROI. Degreed helped innovate on self-directed learning, but didn’t work on implementation of those practices within bigger corporations.
Blake then set on to build Learn In, focusing more specifically on business leader-led education that makes the content that Degreed made more accessible to the right people.
As far as we know, Degreed last raised venture capital in June 2020 in a $32 million round led by Owl Ventures. Its total known capital raised to date is $182 million. Learn In, meanwhile, launched in April 2020 with a little over $3 million in seed financing. It last raised $13 million in April. By raising venture funding, Learn In was selling investors on an outsized-return on their investment. Selling so soon after those initial checks means there was either a solid check in the mix, or a change in scale.
“I think Learn In had a very bright future independently,” he said. That said, by joining Degreed, Learn In has a farther reach and bigger customers, plus it can give the market what it wants: help with the big and little needs of training up employees.
As a result of the deal, Blake will be the CEO of the new, combined entity and Dan Levin, who took over as chief executive of Degreed just last year, will step down. It’s a notable kerfuffle, considering that Blake is returning to the chief executive position he previously held.
Blake described the transition as “amicable” and said that he appreciates Levin’s stewardship.
Blake isn’t fully returning to holding just one job title. Other than Learn In, Blake also spent the pandemic starting Book Club, which has raised millions in venture dollars to bring virtually author-led book clubs to readers. Blake says he’ll remain active as CEO of Book Club, which last announced funding about a year ago. It’s more of a consumer play than his previous startups, or else we’d say it may be Degreed’s next target.