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Pearson Ventures’ $50m fund will explore opportunities in SA, other markets
South Africa is one of the markets in which British education company Pearson will explore opportunities through its $50-million Pearson Ventures fund, Pearson Ventures investment director Owen Henkel has revealed.
The fund — which was announced last Wednesday (10 April) in a LinkedIn post by Pearson chief strategy officer Jonathan Chocqueel-Mangan — will have an initial capital commitment of $50-million over three years.
Pearson Ventures will focus primarily on early-stage startups by making Series A and B rounds, typically partnering with venture firms and accelerators through a co-investment structure.
Pearson Ventures will have an initial capital commitment of $50-million over three years
Henkel (pictured above, left) told Ventureburn earlier today (17 April) that the fund will prioritise companies that have found a product market fit, have figured out the fundamentals of their business model and are getting ready to scale.
“The typical ticket size for investments will range from $2-million to $5-million with the goal of four to five investments per year,” he said.
Henkel said the fund’s first investments will “most likely” occur later this year. “However, we are willing to wait in order to find the right companies”, he added.
Pearson Ventures, he explained, is open to partnering with members of Africa’s edtech community, though he pointed out the fund is unlikely to have formal partnership agreements with firms.
Henkel said Pearson sees some “really fascinating” solutions coming out of various countries and thinks that there’s a huge potential for leapfrog solutions given the mobile first playbook on most business-to-consumer (B2C) tech companies.
He added that the continent’s demographic bulge means that the Africa will need to find innovative tech-enabled solution to meet demand and that this is encouraged by the emergence of regional startup hubs in Nairobi, Cape Town, Kigali and Lagos.
‘Focus on markets where Pearson has footprint’
In a statement announcing the launch of Pearson Ventures last Wednesday (10 April), Pearson chief strategy officer Jonathan Chocqueel-Mangan said the fund will invest in growth stage startups that are building the future of education and employment.
Chocqueel-Mangan explained that Pearson Ventures will build on the success of Pearson’s Affordable Learning Fund — which has invested over $20-million — in edtech startups that are making some of the highest impact and improving education for underserved populations, while returning more than $7-million to the firm.
“While we will have a global remit, we will focus on geographies where Pearson already has a significant footprint, both to maximise the strategic benefits to our investees and the relevance to Pearson,” said Chocqueel-Mangan.
In addition, Pearson Ventures will prioritise companies that are working in what Chocqueel-Mangan described as areas of high strategic importance.
These he said include: employability, lifelong learning and next-generation assessment, artificial intelligence, mobile-first delivery, remote proctoring, augmented or virtual reality, upskilling, income share agreements, as well as solutions that increase higher-ed access.
The fund will proactively connect its portfolio companies with experts in content, product design, as well as advise on geographic and market expansion.
“In most cases, new investments will have a Pearson advocate or sponsor as a touch point, in addition to the investment team,” he said.
He added that on a case-by-case and mutually agreed basis, Pearson Ventures portfolio companies will also be be able to receive a seconded Pearson employee or join a Pearson team or office as an entrepreneur-in-residence.
Featured image, left to right: Pearson Ventures investment director Owen Henkel and Pearson Affordable Learning Fund co-founder Michael Barber ( Pearson Ventures via Twitter)