By definition, private equity typically refers to investment funds, generally organized as limited partnerships, which buy and restructure companies that are not publicly traded.
In other words, private equity is composed of funds and investors that directly invest in private companies, or that engage in buyouts of public companies, resulting in the delisting of public equity.
While some private equity comes from private individuals, most private equity funding comes from private equity firms. These firms are often partnerships that obtain their investment funds from wealthy individuals, investment banks, endowments, pension funds, insurance companies, various financial institutions and even corporations wishing to foster new products, businesses or technologies. In this article, we take a look at some of the top private equity firms that are investing in education.
The Carlyle Group
The Carlyle Group is an American multinational private equity, alternative asset management and financial service corporation. Founded in 1987 in Washington, DC, it is one of the world’s largest and most successful investment firms with $212 billion of assets under management. It specializes in corporate private equity, real assets, global credit, and investments.
Some of the major education companies/firms invested by The Carlyle Group include WorldStrides, the largest provider of supplemental educational student travel programs in the US in 2011, and Uniasselvi, a subsidiary of the Kroton Education group in Brazil in 2015.
KKR & Co. Inc.
KKR & Co. Inc. is a global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit, and hedge funds.
New York-headquartered KKR is one of the most aggressive investors in the education sector across the world. Some of its biggest deals include investments in the UK-based Cognita Schools which offer K-12 education as well Baltimore-based Laureate International Universities, an American network of colleges. And recently, the firm has announced acquisition of about 90% stake in EuroKids chain of schools from existing private equity investors Gaja Capital and Swiss fund Partners Group.
CVC Capital Partners
CVC Capital Partners is a leading British private equity firm. Established in 1981, it is a world leader in private equity and credit with $75 billion of assets under management, $123 billion of funds committed and a global network of 24 offices. CVC’s private equity platform manages over $53 billion of assets and comprises four strategies – Europe/Americas, Asia, Strategic Opportunities, and Growth Partners.
CVC has invested or involved in various deals for stake in education companies across the world. Besides many, in June, 2019, a consortium led by it has agreed to acquire a 30% stake in the world’s largest private education provider by revenue Dubai-based GEMS Education. And recently, CVC Capital Partners has announced that CVC Fund VII has agreed to acquire 50% of Multiversity, the owner of Italy’s largest online university Pegaso as well as Mercatorum University.
Kaizen Private Equity
Kaizen Private Equity is India’s first private equity fund focused on India’s huge education market. It invests in promising companies, which are leaders in the core, parallel and ancillary segments of education, with a keen focus on adding significant value post investment.
Kaizen PE has invested or led the funding round in various edtech startups in India and across Asia. Besides many, the firm has recently led a Series A round funding of $35 million in Mumbai-based edtech startup Toppr.
SAIF Partners is a leading private equity firm that provides growth capital to companies in Asia. It invests in helping Asia’s exceptional companies grow from concept to IPO. The firm has offices in Hong Kong, China, and India and currently manages over $4 billion in capital.
The firm specializes in private equity and venture capital in a number of different sectors like Internet, education, technology, financial services, Information technology enabled services, enterprise SaaS, retail, and consumer brands.
Gaja Capital is a private equity firm that invests in mid-market companies in emerging sectors such as education, financial services, consumer and healthcare.
The India-focused firm has invested or led the funding round in various educational companies, some of which include Ahmedabad and Bengaluru-based edtech company Educational Initiatives, SportzVillage, EuroKids, and CL Educate.
Baring Private Equity Asia
Baring Private Equity Asia (BPEA) is one of the largest independent private equity firms in Asia. The firm runs a pan-Asian investment program, sponsoring buyouts and providing growth capital to companies for expansion or acquisitions, as well as a private credit and a pan-Asian real estate private equity investment program. BPEA has over 30 portfolio companies which operate in more than 70 countries. The firm has carried out a total transaction value of over 12 billion since 1997.
BPEA has invested in various educational ventures. In February this year, the firm-owned Nord Anglia acquired five Oakbridge K-12 schools, and in March 2018, it invested in Wall Street English, world’s leading English language training network for adults, along with CITIC Capital, to name a few.
Mekong Capital is a Vietnam-focused private equity firm, specializing in consumer-driven businesses. Established in 2001, it is one of the first private equity firms to engage Vietnam and has the most extensive private equity track record in the country. The firm has managed four funds and has completed 35 private equity investments, of which 26 have been fully exited.
While Mekong Capital invests mostly on consumer-driven sectors such as retail, restaurants, consumer products and distribution, the firm has invested or involved in many educational companies. It has invested in edtech companies like Vietnam Australia International School, YOLA, etc. to name a few.
Verod Capital Management
A Nigeria-based private equity firm, Verod Capital Management is active across various sectors, including light manufacturing, consumer goods, business services, agriculture, education, healthcare and financial services.
The firm has a huge interest investing in education sector through its educational investment vehicle Oreon Education. Besides others, in 2017, Verod acquired a stake in Greensprings School, one of Nigeria’s leading private secondary schools, bringing the number of its investment in private secondary schools to five.
Founded in 1994, AfricInvest is part of Integra Group, an investment and financial services company based in Tunisia. Uniquely positioned as one of the most experienced private equity investors on the continent, AfricInvest has dedicated investment teams focused on North Africa and Sub-Saharan Africa. The firm manages US$1 billion across 14 funds.
Since its founding, AfricInvest has invested in 135 companies across 24 African countries offering extensive expertise in key growth industries, including financial services, consumer/retail, education and healthcare. In education, besides many, AfricInvest has backed International Community School, a private school in Ghana, in a preferential share deal in 2017. The investment was the sixth for the firm’s third private equity fund.
The Northstar Group is a Singapore-based private equity firm managing more than US$2 billion in committed equity capital dedicated to investing in growth companies in Indonesia and other countries in Southeast Asia. Since its founding in 2003, the firm has raised five private equity funds and invested in more than 30 companies across various sectors.
Besides investing in sectors such as banking, insurance, retail, oil and gas, coal and mining services, technology, telecom, and agribusiness, the firm has also made several bets in edtech companies in Indonesia and the region. One of the biggest deals the firm has made in the edtech space was $50 million in Vietnam-based edtech startup Topica in 2018. It is the biggest financing for an online education in Southeast Asia.