Pearson Plc buys Credly in a $200 million deal

Pearson Plc buys Credly in a $200 million deal

LONDON, UK: Pearson plc, the world’s leading learning company, has acquired Credly, the market leader in digital credentials and certifications for the workforce.

The purchase price for Credly, including Pearson’s existing stake, represents a total value of $200m, which will be funded from Pearson’s existing cash and available liquidity. This comprises a total upfront consideration of c.$140m, Pearson’s existing stake valued at c.$40m and a deferred consideration.

The acquisition of Credly, in which Pearson Plc already had a c.20% stake, expands its current presence in the fast-growing workforce skills sector, bringing together workforce analytics, learning, assessment and credentialing services to meet the needs of learners and employers in a rapidly changing global economy.

It further expands Pearson’s digital footprint and accelerates Pearson Plc focus on growth.

Credly offers an easy-to-use platform for organisations, companies, educational institutions and learners to award trusted digital credentials that verify an individual’s skills and help connect them with the right opportunities.

The company’s talent mobility solutions help businesses recruit, engage and develop their workforce, with a skills-based approach to talent management that operates at enterprise scale.

More than 2000 organisations use Credly and since its inception, the company has issued over 50 million credentials to 25 million people, making it the world’s largest professional credentialing business.

The acquisition comes at a time of increasing demand for digital credentials to recognise skills and certifications in a global talent market valued at c.$400bn. Over the last year, Credly has added nearly 1,000 new organisations to its network, expanded its density of skill coverage in key segments of the labour market and maintained net renewal rates of well over 100%.

Andy Bird, Chief Executive of Pearson, said: “The Credly acquisition is another important step in accelerating our strategy in the workforce skills market and in building connectivity across the entire Pearson portfolio. The growing skills gap is putting enormous pressure on the labour market, making verified credentials more essential than ever before.”

“We originally invested in Credly in 2018 because we recognized its potential and have been impressed with the strong management team and their deep understanding of the talent market. Credly complements our other recent acquisition – Faethm – to address the full learner journey, enabling us to work with employers and employees to identify skills needs, provide learning to address those needs and offer trusted credentialing to prove proficiency.”

Jonathan Finkelstein, founder and CEO of Credly, said: “This exciting move combines Credly’s expertise in the skills economy with the global scale, learning expertise and financial strength of Pearson. Joining forces accelerates the realisation of our vision to build a world where every person can achieve their full potential based on their verified skills and where organisations can make better human capital decisions and build more equitable workforces using trusted information about what people know and can do.”

The combination of Credly and Pearson will create a powerful solution in the global workforce skills sector. The acquisition follows Pearson’s 2021 purchase of Faethm, the strategic workforce AI and predictive analytics platform. These businesses will sit at the heart of Pearson’s Workforce Skills division, complementing Pearson’s existing expertise in reskilling and workforce learning. This will enable the Company to serve employers and learners together in a single ecosystem: helping employers to understand labour market dynamics and future proof their workforces whilst helping workers gain the skills needed to boost their employability prospects.

In the year ending December 2021, Credly grew revenues by 47% to $13.3m, and have delivered CAGR revenue growth of 42% from 2019-2021.

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