British publishing group Pearson has formed a joint venture with Educomp Solutions Ltd, an educational-content and software maker, for vocational training, in which the UK company has picked up a 50% stake in for $17.5 million. Pearson has also said that it has picked up a 17.2% stake in TutorVista, an online tutoring and test preparation provider. VCCircle reported on Tuesday that Pearson invested $12.5 million in TutorVista.
Pearson is investing a total of $30 million across these two deals in the Indian education sector.
India's government currently invests $30 billion each year or 3.7% of GDP in education, while Indian consumers spend an additional $50 billion each year on private educational institutions and services.
The joint venture with Educomp will provide vocational training to students and professionals from industries like financial services, retail and construction. The training will have a focus on English language, and will be delivered both online and through Educomp's network of centres, using Pearson's educational content, technology and related services.
"This exciting new venture is perfectly poised to meet the exploding demand for professional skills training in India's service-based economy. The National Skills Development Council is targeting training 500 million workers by 2020 - this is one of the largest opportunity available anywhere in the world of education," said john Makinson, Chairman of Pearson India, talking about the deal with Educomp.
The deal with TutorVista will help Pearson add online tutoring to its range of services for students in North America, the UK and other parts of the world. Pearson has picked up a 17.2% stake for $12.5 million, valuing the five year old firm at $72.6 million. Pearson has become the firms largest shareholder. TutorVista has raised funding of nearly $18-20 million from Sequoia Capital, Lightspeed Venture Partners, Silicon Valley Bank and Manipal Education and Medical Group.
Pearson will work with both TutorVista and Manipal to develop new businesses for the schools market in India, the release by Pearson added. Bangalore-based TutorVista teaches more than 20,000 registered students using Voice-Over-Internet-Protocol and online whiteboards. The firm started India operations with acquisition of Edurite Technologies, a player in the domestic education segment, in 20007.
