Pearson to Sell PowerSchool to Vista Equity Partners for $350 Million


Global curriculum and school technology provider Pearson will be selling its student information system PowerSchool to Vista Equity Partners for $350 million later this year.

The student information system (SIS) is popular, but Pearson is said to have been trying to sell it since February of this year. The popular higher education program Blackboard was rumored to be interested, but it will be going to Vista Equity Partners in the fall with its 440 employees intact.

The program includes software like attendance tracking and seating chart programs, writes Deidre Hipwell of The Times.

PowerSchool was developed in 1997, then sold to Apple in 2001 and then to Pearson in 2006, writes Tony Wan of edSurge. It’s the market leader in the student information systems, but many districts use the services of smaller companies, so it’s by no means dominant. It was profitable for Pearson, but did not fit with a business plan in which they intended to focus on students rather than the administration needs of schools.

The program also allows connectivity for students via apps for Android and iPhone, enabling them to view their personal schedule, grades, attendance records, and other information.

Pearson’s CEO John Fallon said:

The sale of PowerSchool, an administrative system rather than a tool for learning, teaching, or assessment, will enable us to focus more directly on learning outcomes, and further simplify Pearson as we make our products more global, digital, and scalable.

Like every market out there, the SIS market will consolidate around a couple of major players. The SIS is so mission critical, and because the switching costs– not just dollars, but in terms of change management and training– are so steep, a lot of the districts have hung on to local or single-state players whose technologies are out of date.

The customers who are on older platforms will eventually move on. They are realizing that they are getting left behind and not getting technology and state reporting updates.

Pearson has stated that PowerSchool’s data security features keep student data safe in compliance with HIPAA and FERPA privacy laws. 13 million students worldwide are currently tracked and served via PowerSchool’s platform.

Vista Equity partners is a private equity firm focusing on software- and technology-related endeavors. Vista’s other acquisitions have included Websense, which focuses on cyber security, and Active Network, Inc., a web-based event registration service. The firm recently acquired TIBCO Software Inc., which provides message queue servicing for cloud-based computing environments.

According to RTT News, PowerSchool made $97 million in revenue and $20 million in operating income in 2014.

06 27, 2015
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