A prominent virtual reality learning company is preparing for a significant growth phase in 2024, supported by its recent US market expansion.
The firm, based in Gloucestershire, aims to increase revenue and EBITDA by over 50%, thanks to the growing demand for its educational technology products.
US Market Expansion Drives Revenue Boost
The company, established in Quedgeley, now serves more than two million students across 200,000 institutions in 90 countries. Its expansion into the US market has been particularly noteworthy, driving a substantial portion of its 2023 revenue.
By the end of 2023, the company reported earnings of £23m, with an EBITDA of £6.4m. This financial performance was largely attributed to its strategic entry into the US education sector, which has proven to be a lucrative market.
Strategic Partnerships with US School Districts
Since its initial entry into the US in 2007 and establishing its first office in 2021, the firm’s US operations have flourished. It now collaborates with 2,500 schools and over 1,200 school districts, including notable collaborations with Los Angeles Unified School District in California and Montgomery Public Schools in Alabama.
The ambitious efforts are geared towards securing additional district-wide agreements, further solidifying its presence in the US educational landscape.
Alignment with US Curriculum Standards
To strengthen its market position, the company has aligned over 400 of its educational lessons with US State Standards in science, social studies, and English Language Arts for the 2023-24 academic year.
This targeted approach not only enhances the value of its offerings but also ensures relevance and adoption within US schools, which are increasingly prioritising curriculum-aligned resources.
Investing in aligning content with standards is part of the company’s broader strategy to embed itself within the educational systems of its target markets.
Growth Prospects in EMEA and Asia
Beyond the US, the company is setting its sights on expanding its footprint in Europe, the Middle East, Africa (EMEA), and Asia. This is part of its strategy to diversify and tap into new markets, contributing to overall revenue growth.
Focused investments in content development are expected to drive this expansion, with the firm aiming to increase software subscription revenues, a significant component of its income model.
Investor Confidence and Financial Backing
In August 2022, the company received a substantial investment from a UK private equity firm, which has been instrumental in fueling its growth ambitions.
According to Aziz Ul-Haq, a partner at the equity firm, the company’s strong growth trajectory is poised to accelerate further as it continues to invest in its product offerings and expand its market presence.
The Role of SaaS in Driving Growth
Currently, the firm has 10,000 schools subscribing to its SaaS (Software as a Service) licences. This business model not only provides steady revenue streams but also fosters long-term relationships with educational institutions.
By continually enhancing its software offerings and adding new features, the company aims to retain existing customers while attracting new ones in diverse markets.
Leadership’s Vision for Future Expansion
Huw Williams, the firm’s chief executive, emphasized the significant opportunities presented by US school districts. He highlighted the scalability potential these large-scale partnerships offer, enabling rapid growth.
Williams remarked, “From a growth perspective, there is a significant opportunity with US school districts, which help us to scale at pace.”
The company’s strategic expansion into the US market and its alignment with educational standards are key drivers of its projected growth. With continued investment in content development and a strong SaaS model, the firm is well-positioned to achieve its ambitious revenue targets for 2024.
As it looks beyond the US to markets in EMEA and Asia, the firm aims to replicate its success and solidify its reputation as a leader in virtual reality education technology.
