Warburg Pincus Leads an Investment of Up to $60 Million in Higher Education …

28 Sep 2015 | Author: | No comments yet »

Austin-based Civitas Learning lands up to $60 million investment.

Civitas Learning® (“the company”) today announced that Warburg Pincus is leading an investment of up to $60 million in the company. Civitas Learning has pioneered the use of data science and design thinking to support higher education institutions as they improve learning and increase degree completion. Austin Community College’s president and chief executive, Richard Rhodes, has literally sang praises—or more accurately, a sultry slow jam—about an app that helps students plan their coursework. The lead investor in the deal was Warburg Pincus, based in New York, with participation from previous backers including Emergence Capital Partners, based in Silicon Valley; Austin Ventures and Rethink Education, based in White Plains, N.Y. Civitas Learning launched its beta program with six colleges and universities in 2011, and began working with other leading institutions from across higher education in 2013, forming what is called the Pioneer cohort.

New York-Based Warburg was joined in the new funding round by existing Civitas investors, including Austin Ventures, SJF Ventures, and Gera Venture Capital. “With this investment, we’re going to be able to improve and accelerate both learning and student outcomes for our partner institutions,” Charles Thornburgh, Civitas’s founder and CEO, says in a press statement. Since that time, the company has worked with a wide variety of partner institutions to develop and deploy an integrated analytics system that draws data from multiple sources and uses cutting-edge data science to build institution-specific predictive models for student intake, persistence and graduation. Data sources can range from student information systems and learning management systems to financial aid, enrollment management and “swipe card” data (how often a student accesses the library or computer lab, for instance).

Adarsh Sarma, managing director at Warburg Pincus, said the company “is truly a pioneer in the field of using applied data analytics to improve student outcomes. We have been impressed with the team’s vision of dramatically improving student outcomes by developing an education analytics system.” Before founding Civitas Learning, Thornburgh was a senior executive at test preparation and tutoring giant Kaplan Inc., where he spent nine years as an in-house entrepreneur and launched several technology businesses. Mark Milliron, Civitas Learning’s Co-Founder and Chief Learning Officer. “We look forward to working closely with Warburg Pincus and our other investors as this investment enables us to take our work to the next level.” The new growth investment reflects the increasing demand among institutions for actionable data and insight that assist them in making better-informed decisions and provide faculty, advisors, and students with more personalized and timely support. The prospect of mining data to create early warning systems that flag at-risk students have attracted both entrepreneurs and investors, including Mark Cuban, who in July put money into another Texas-based company focused on student retention. Founded in 2011, Thornburgh says the goal of Civitas is to help create an “ecosystem of educational innovation.” The company will work on enhancing its software so that it will also connect with apps developed by both its customers and other companies.

While the company could become an acquisition target by larger players, Thornburgh said the new investment “preserves our ability to be independent. One of the partners was Austin Community College (ACC), where “disparate sources of student information were never brought together,” recalls Rhodes. In addition to commonly used tools like Blackboard, ACC had built its own data tools “that are not relational to other data systems.” In addition to building the technology infrastructure to pull data from different sources, Civitas has developed five analytics apps. It’s the tool that inspired Rhodes’ music video. “We always assumed that students knew where they were in their pathway,” says Rhodes. “But when we rolled it out we realized quickly that there were students who took courses that didn’t apply to their degrees, or changed majors without realizing what that would cost them.” Another tool, Illume, can help administrators and faculty better understand how to provide student support. The system can show, for instance, whether a standardized test score or high school class percentile is a better predictor of student persistence; this in turn can inform how the school provides financial aid and scholarships.

For more information, visit: www.civitaslearning.com About Warburg Pincus Warburg Pincus LLC is a leading global private equity firm focused on growth investing. And it will continue to work with universities to build new tools that leverage additional data sources. “There is a lot of interest from our higher-ed partners to understand how students did in K-12,” says Thornburgh.

Founded in 1966, Warburg Pincus has raised 14 private equity funds, which have invested more than $50 billion in over 720 companies in more than 35 countries. Still, he urges the need for patience. “This shift will not happen overnight, but more and more we are seeing forward-thinking institutions embrace the opportunity to commit the time and resources to these efforts.”

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