prek 12 education q2 2014 - capstone partners prek-12 education... · prek‐12 education q2 2014...

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CHICAGO

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PHILADELPHIA

SAN DIEGO

SILICON VALLEY

Q2 2014PreK‐12 EDUCATION

CONTACTS

Eric WilliamsManaging Director(215) 854‐[email protected]

Mark SurowiakDirector(215) 854‐[email protected]

Daniel SchultzDirector of Business Development(617) 619‐[email protected]

MERGER & ACQUISITION ACTIVITY

The PreK‐12 education sector is undergoing a transformation as a result of increasing utilization of

digital technology and curriculum, pressure for enhanced student outcomes, and the need for

cost effective solutions due to budgetary constraints. This transition is creating a unique growth

opportunity for product and service providers that offer a compelling value proposition to a

market that is struggling to improve efficiencies, leverage technology and student assessment

tools properly, and boost student results. Strategic suitors and private equity groups have long

been attracted to the sector and merger & acquisition activity in the education industry is

intensifying based not only on the long‐term prospects for the sector but also the favorable M&A

environment overall.

Middle market M&A activity is benefitting from several fundamental factors that are promoting

deal activity. These include:

Strong transaction valuations for quality companies;

A healthy debt market supported by ready access to cash and low interest rates;

Strategic acquirers with more than $1 trillion in cash on their collective balance sheets, and

an increased willingness to put corporate cash reserves to work;

Abundant private equity capital, with the highest capital overhang (funds raised vs. funds

deployed) figure since 2009;

A need for strategic and financial buyers to expand faster than organic growth allows; and

A modestly expanding US economy and healthy public equity markets, both of which are

boosting buyer confidence.

Looking forward, the outlook is optimistic, with expectations that the M&A market should benefit

from a continuation of these positive factors through 2014 and 2015.

The sizable opportunity in the education sector has become more apparent in recent years as

educators and educational leaders increasingly look to private companies to provide

supplemental resources, education technology and products, and specialized outsourced services

to help solve the myriad of problems facing schools. While the US spends more money on

education than almost any other nation, American students continue to fall behind. In fact, in the

latest Program for International Student Assessment report the US failed to crack the global Top

20. Parents and students alike are demanding change in the form of improved offerings and

better student outcomes, all at a much lower cost. Increasing concern, some might say paranoia,

among parents ̶ even those with young children ̶ regarding the competitive college admission

process is driving demand for supplemental enrichment programs, tutoring, and quality early

childhood education. Most everyone agrees that educational content, delivery and assessment

needs to dramatically improve, and that private companies with innovative products and quality

services will be in high demand.

Transactions are occurring in virtually every sector of the industry, including the

following:

Marketing & Recruiting Services: Used by private schools to boost enrollment.

Administrative Solutions: Companies that help schools reduce their fixed

infrastructure and administrative costs.

Learning Materials & Services: Including in‐classroom and online curriculum and

content solutions, as well as childcare, special & alternative education, tutoring,

private schools, and education management organizations.

Assessment Tools: Used to assess performance, allow learners to move at their

own pace, and test for placement and college entrance.

Student Services: Such as career and post‐secondary counseling, as well as

supplemental programs for special student populations.

Talent Management: Teacher evaluations and other HR solutions for educators.

Throughout these sectors are several themes, around which much of the M&A

activity is occurring. One is education technology, which is being utilized throughout

the education continuum, including in administration, teaching, and assessment. In

addition to solutions for education providers, many edtech companies are also

creating solutions for students, including platforms to access educational information

and learning aids, rent and sell textbooks, and receive tutoring. Another prevalent

theme is competency‐based education, which incorporates customized, adaptive

learning solutions that allow students to progress at their own pace. Early childhood

and supplemental education needs are also prominent. Companies that provide

products and services that support these areas are in especially high demand, and

Capstone expects M&A activity in the industry will continue at a heightened pace

through the remainder of the year and into 2015.

PRIVATE EQUITY GROUPS TARGET EDUCATIONMARKET

Private equity groups are very active acquirers in the education space, attracted by

the industry’s growth and market fundamentals, its fragmented nature and

consolidation opportunities, and the disruptive changes in the space that are

resulting in the emergence of innovative solution providers. In fact, there has been a

recent increase in private equity investments in the sector, and it is estimated that

PEG‐backed transactions now represent more than half of all transactions closed in

the industry. In most cases, private equity sponsors are looking for companies that

deliver measurably superior outcomes, boast proven brand names, possess

competent senior management teams, and feature a track record of strong financial

performance.

Capstone expects that private equity firms will continue to be very active in the

education space. As a whole, these buyers are looking to strategically build their

portfolios, making platform acquisitions followed by several add‐on investments.

And, they have substantial cash reserves to spend on acquisitions. The current

overhang, money raised by private equity funds that has remained uninvested, is

estimated at $480 million, a near‐record amount. Furthermore, these groups are

once again enjoying a healthy fundraising market, with 2013 funds raised reaching

the highest figure, $220 billion, since 2008. These buyers also have access to readily

available and affordable debt with which to fund their transactions, an important

component of many private equity deals.

Capstone Partners LLC 2

PreK‐12 EducationQ2 2014

NOTABLE PEG TRANSACTIONS IN EDUCATION

Many private equity groups are active in the PreK‐12 education industry, in some

cases making multiple transactions in the course of a year. Profiles of several notable

PEG transactions follow, with a more inclusive summary of recent deals on the

following pages.

American Securities acquires Learning Care Group (May 2014) – American

Securities, in partnership with the company’s management, acquired Learning Care

Group from Morgan Stanley Private Equity, which had purchased the company in

2008. Learning Care Group provides early education and child care services in North

America and internationally. It operates corporate and franchise schools for children

between the ages of 6 weeks and 13 years. The company was formerly known as

Childtime Learning Centers Inc.

Weld North Holdings acquires Truenorthlogic and Imagine Learning (April 2014) –

Truenorthlogic is a provider of SaaS‐based K‐12 talent management solutions

designed to support an educator’s entire professional growth cycle. Imagine

Learning is a developer of language and literacy software catering to English learners,

readers, disabled students, and early childhood education students. Terms of the

deals were not officially disclosed, but it was estimated that Weld North paid a total

of more than $150 million for the two companies.

Weld North is an investment partnership backed in part by the private equity giant

Kohlberg Kravis Roberts. Weld North’s first K‐12 education purchase was Edgenuity,

a specialist in helping students who have fallen behind academically catch up with

their peers. Weld North also combined two smaller companies into Generation

Ready, a provider of school improvement services that works with school leaders and

teachers to elevate student achievement through professional learning services and

targeted solutions. The firm is run by Jonathan Grayer, the former Chairman and

CEO of Kaplan, Inc., a global education company. Weld North now has a $200

million, rapidly growing digital education platform poised to capitalize on the

dramatic growth in digital learning. Additional acquisitions are expected as the group

looks to solidify its leadership position in the K–12 digital education market.

Hellman & Friedman acquires Renaissance Learning (March 2014) – In an example

of a very large private equity investment in the education space, Hellman & Friedman

acquired learning analytics service provider, Renaissance Learning, for $1.1 billion in

an all‐cash deal. This transaction came just weeks after Renaissance closed a $40

million funding round led by Google Capital at a valuation of $1 billion. The private

equity group intends to help expand Renaissance’s impact globally through

continued investment in products “that make a difference” in the classroom. It was

attracted to Renaissance Learning’s robust growth (21% revenue increase in the last

year), competitive advantages, and strong presence in the education space.

Renaissance Learning has itself made several acquisitions over the years. Its latest

was the June 2013 purchase of Subtext Media, Inc., a company that develops an

application for iPad that allows classroom groups to exchange ideas in the pages of

digital text.



NOTABLE PEG TRANSACTIONS IN EDUCATION (Continued)

Calvert Education, backed by Camden Partners, acquires VSCHOOLZ (October 2013)

– Calvert Education Services, a Camden portfolio company, acquired VSCHOOLZ, Inc.

to strengthen their digital presence in the K‐12 market, creating a combined

company that is positioned to provide industry‐leading online and blended learning

services to schools, districts, and students. VSCHOOLZ is an educational technology

company that provides e‐learning solutions and curriculum for schools or districts

that want to support a blended digital learning environment in traditional schools, or

that want to launch their own virtual programs.

Camden Partners is an active acquirer in the education industry, with several

education holdings, including Triumph Higher Education Group, a provider of culinary

education and a past client that Capstone represented in its transaction with Camden

Partners. Previous holdings include such well‐known education brands as Princeton

Review and Nobel Learning Communities.

Skyview Capital LLC acquires Newell Rubbermaid’s Teach Platform (July 2013) –

Private equity group Skyview Capital acquired the Mimio and Headsprout interactive

technology businesses from Newell Rubbermaid. Mimio is a leader in interactive

teaching technologies and curriculum solutions for K–12 classrooms. Headsprout is a

developer of literacy and early learning software. In December 2013, Skyview sold

Headsprout to Learning A‐Z, a Cambium Learning® Group company.

Apollo Global Management acquires McGraw‐Hill Education, Inc. (March 2013) – In

a transaction valued at $2.5 billion, private equity group Apollo Global Management

acquired the educational publishing unit of McGraw‐Hill Companies, prevailing over

rival bidders Cengage Learning and buyout firm Bain Capital LLC. The McGraw‐Hill

business is the world's second‐largest educational publishing company. Apollo

invests in a wide variety of businesses and industries and reportedly acquired the

company for its value‐creation opportunities.

Following the acquisition, McGraw‐Hill Education made several additional education

acquisitions. In June 2013, the company acquired ALEKS Corporation, the privately

held developer of the ALEKS® adaptive learning technology for the K‐12 and higher

education markets. The move was designed to strengthen McGraw‐Hill Education's

position as the leader in delivering personalized learning experiences through

adaptive technology and was McGraw‐Hill Education's first acquisition since it was

acquired by Apollo Global Management. Then, in February 2014, the company made

two additional acquisitions, purchasing Engrade and the remaining 80% of Area9 Aps

that it did not already own. Engrade, which was acquired for a reported $50 million,

provides an online platform for K‐12 schools to track and organize grades,

attendance, curriculum, and assessments, while Area9 operates as an adaptive

learning company.

These acquisitions underscore McGraw‐Hill’s transformation from a textbook

publishing company into an educational technology services provider, a strategy

being employed by nearly every educational publisher.



EnterpriseValue (mm)

EV / LTM

Date Target Acquiror Target Business Description Revenue EBITDA

Jun‐14 InstaEDU CheggProvides an on‐demand tutoring service, connecting users with tutors online.

$30.0 ‐ ‐

May 14MyTherapyCompany

Shore Capital Partners

Provides speech pathology and occupational therapy services to school districts & private learning centers.

‐ ‐ ‐

May‐14 Blendedschools.netSibling Group Holdings, Inc.

Offers online courses for K‐12 curriculum, learning technologies, and professional development.

$0.5 ‐ ‐

May‐14 Curiosityville Houghton Mifflin Harcourt

Operates an online store that sells education products for children, ages 3 to 8 years old.

‐ ‐ ‐

May‐14 Channel One LLCHoughton Mifflin Harcourt

Broadcasts daily news programs via TV and the web to five million K‐12 students across the US.

‐ ‐ ‐

May‐14Learning Care Group, Inc.

American SecuritiesProvides early education and child care services in North America and internationally.

‐ ‐ ‐

Apr‐14GlobaLinks Learning Abroad LLC

International Studies Abroad Inc.

Provides study abroad programs for high school and college students. ‐ ‐ ‐

Apr‐14 ClassBadges EdStart, Inc.Operates an online tool where teachers can award badges to students for accomplishments or academic mastery.

‐ ‐ ‐

Apr‐14Reliance Commun./SchoolMessenger

West CorporationOffers a range of voice, text, and online tools to help K‐12 schools notify parents and students.

‐ ‐ ‐

Apr‐14 Imagine LearningWeld North Holdings

A game‐based solution that engages children and supports teachers in teaching English language and literacy skills.

‐ ‐ ‐

Apr‐14 TruenorthlogicWeld North Holdings; KKR

Provides professional development software that helps teachers build skills and track data on professional growth.

‐ ‐ ‐

Mar‐14Renaissance Learning

Hellman & Friedman Offers digital content programs used in schools. $1,100.0 ‐ ‐

Mar‐14The Achievement Standards Network

Desire2LearnIncorporated

Operates a free public service that maps learning content and activities to over 1,300 education standards.

‐ ‐ ‐

Mar‐14 ExitTicket EdStart, Inc.Provides a classroom feedback system that works on any wifi‐enabled smartphone or tablet.

‐ ‐ ‐

Mar‐14Teachers Notebook, LLC

OverDrive, Inc.Operates an online marketplace for teachers to buy classroom tested resources and instructional materials.

‐ ‐ ‐

Mar‐14 Crème de la CrèmeGladstone Commercial Corp.

Operates two child care facilities in Texas. $10.5 ‐ ‐

Feb‐14Area9 Aps (remaining 80%)

McGraw‐Hill Education

Operates as an adaptive learning company. ‐ ‐ ‐

Feb‐14 Engrade McGraw‐Hill Education

Provides an online platform for K‐12 schools to track and organize grades, attendance, curriculum, and assessments.

$50.0 ‐ ‐

Jan‐14 TutorSpree WyzAntA Y‐Combinator startup providing an online marketplace for K‐12 tutors.

‐ ‐ ‐

Jan‐14Advanced Academics (AAI)

Connections Edu/ Pearson plc

An online learning provider for over 83,000 students in grades 6‐12 at 170 school districts and charter schools.

‐ ‐ ‐

Jan‐14Northern Educate VSC LLC

Ability Academic and Athletic LLC

Operates as a private K‐12 school providing athletic training and online academics.

‐ ‐ ‐

Dec‐13 Vivity Labs Rosetta StoneDevelops and offers a suite of "Brain Games" designed to strengthen cognitive skills.

$12.0 ‐ ‐

Dec‐13 HeadsproutLearning A‐Z/Cambium Learning

Develops literacy and early learning software. $4.0 ‐ ‐

Dec‐13 The Mandell School Rocket GroupAn educational institution that provides preparatory curriculum to toddlers through 8

thgrade students.

‐ ‐ ‐

Dec‐13 Chalkable Software Technology, Inc.

Offers schools an educational app store that helps teachers with purchasing, accounts, and data management.

‐ ‐ ‐

Nov‐13 Kno IntelProvides a digital textbook service, with 225,000 K‐12 and higher‐ed titles via partnerships with ed. publishers.

$15.0 ‐ ‐

Nov‐13 Choice SolutionsHoughton Mifflin Harcourt

Provides data integration, management, and analytics tools for state and district‐level education systems.

‐ ‐ ‐

Oct‐13Learner’s Edge Media Group, Inc.

Avante Mezzanine Partners

Provides professional development and continuing education courses for teachers.

‐ ‐ ‐



PREK‐12 EDUCATION PRODUCTS & SERVICES: SELECT M&A TRANSACTIONS

PREK‐12 EDUCATION PRODUCTS & SERVICES: SELECT M&A TRANSACTIONS (CONTINUED)


EV / LTM

Date Target Acquirer Target Business Description Revenue EBITDA

Oct‐13 Adrenna GilfusVenture Partners

Offers an open‐source learning management system for K‐12 and higher‐education institutions and businesses.

‐ ‐ ‐

Oct‐13TenMarks Education, LLC

Amazon.com Inc.Offers an online, adaptive math program for grades K‐12 with users in over 25,000 schools and 7,000 districts.

‐ ‐ ‐

Oct‐13 VSCHOOLZ, Inc.Calvert Education/Camden Partners

Provides e‐learning solutions and curriculum for schools or blended digital learning environment in traditional schools.

‐ ‐ ‐

Oct‐13 LeadAmerica, LLC Envision EMI, LLCConducts educational programs and conferencesfor students.

‐ ‐ ‐

Sep‐13 Knowillage Desire2Learn Incorporated

Operates a personalized learning platform that maps learning materials to learning objectives.

‐ ‐ ‐

Sep‐13KGIC Ed. Group; KGIC Language College

Loyalist Group Limited (TSXV:LOY)

Provides English language learning programs. $12.8 0.5x ‐

Aug‐13California Tutor Network, Inc.

WebWiseTutors,Offers online tutoring services for K‐12 students in California.

‐ ‐ ‐

Aug‐13Educational Testing Service (Division)

Intl. Scholarship and Tuition Services, Inc.

The Scholarship & Recognition Programs Division provides admin. services to scholarship‐granting organizations.

‐ ‐ ‐

Aug‐13 KinderTown LLC Demme LearningA startup whose app store for parents points users to the top educational apps for children.

‐ ‐ ‐

Aug‐13eInstruction Corporation

Turning Technologies, LLC

Offers educational technology, classroom instruction & student response systems for the K‐12 market.

‐ ‐ ‐

Aug‐13Dalmatian Press, LLC

Bendon Publishing International, Inc.

Provides coloring and activity products, crayons, educational books, novelty products, and stickers.

‐ ‐ ‐

Aug‐13Lexia Learning Systems, Inc.

Rosetta Stone Ltd.Offers reading products used in over 14,000 schools and by more than one million students online.

$22.5 1.5x ‐

Jul‐13Grockit Inc., Certain Assets

Kaplan, Inc.Includes the test preparation assets and social learning platform of Grockit, Inc.

‐ ‐ ‐

Jul‐13 Element, LLC MPS Limited Provides editorial, design and production services to the educational publishing industry.

$1.8 ‐ ‐

Jul‐13Children's Choice Learning Centers

Bright Horizons Family Solutions

Provides early care and education programs to employees’ children and their families.

$53.0 1.3x ‐

Jul‐13Newell Rubbermaid, Teach Platform

Skyview Capital LLCComprised of online platforms that provide educational services under the brand names Mimio and Headsprout.

‐ ‐ ‐

Jun‐13 York PlaceThompson Child & Family Focus, Inc.

Specializes in clinical and behavioral treatment, developmental education, and proactive care for children.

‐ ‐ ‐

Jun‐13 Subtext Media, Inc.Renaissance Learning Inc.

Develops an iPad application that allows classroom groups to exchange ideas in digital texts.

‐ ‐ ‐

Jun‐13Three Child Care Centers

BrightPath Early Learning

Two child care centers in Edmonton and a Montessori school in Ottawa.

$1.8 ‐ ‐

Jun‐13 ALEKS CorporationMcGraw‐Hill Education

Provides "adaptive" math platforms for K‐12 and higher education.

‐ ‐ ‐

Jun‐13 Providence HallSanta Barbara Christian School

Operates as an independent, college preparatory Christian school serving grades 7‐12 in Santa Barbara, California.

‐ ‐ ‐

Jun‐13St. Francis Xavier Preparatory School

Pope John Paul II High School

Operates as a private middle school, offering grades 5‐8. ‐ ‐ ‐

May‐13The Community Corkboard, LLC

Finder411, LLCOwns and operates online communities for schools and organizations.

‐ ‐ ‐

May‐13Sensational Beginnings, Inc.

Creative Kidstuff Inc.Operates a catalog of educational toys and products for infants and toddlers.

‐ ‐ ‐

May‐13 DataServSkoda MinottiTech. Partners LLC

Provides communication solutions for the public sector, including the K‐12 education market.

‐ ‐ ‐

May‐13Lisa Davis Holdings Ltd.

Edleun Group, Inc. Provides kindergarten recreational programs. ‐ ‐ ‐

May‐13 NK Labs Inc.5Touch Solutions, Inc.

Develops a Web based app for teachers to get instant feedback from students re: their understanding.

‐ ‐ ‐

Apr‐13 ThinkBinder Echo360A collaboration app for students and teachers to create online study groups and share files, links and whiteboards.

‐ ‐ ‐



PREK‐12 EDUCATION PRODUCTS & SERVICES: SELECT M&A TRANSACTIONS (CONTINUED)

LTM = last twelve months; EV = enterprise value;

Sources: Capstone Partners LLC research; Capital IQ; public filings and press releases


EV / LTM

Date Target Acquirer Target Business Description Revenue EBITDA

Apr‐13 SchoolChapters, Inc.Houghton Mifflin Harcourt Publishing

Provides quality management tools and childhood education online portfolio management solutions.

‐ ‐ ‐

Apr‐13 Tribal Nova, Inc.Houghton Mifflin Harcourt Publishing

Provides educational online services & games for childrenin partnership with major media partners.

‐ ‐ ‐

Apr‐13The Children's Secret Garden Inc.

Child Health Holdings, Inc.

Owns and operates a child care center. ‐ ‐ ‐

Apr‐13 NewMindsets Inc. ClevrU CorporationAn e‐learning company, providing web‐based training for continual performance support and improvement.

‐ ‐ ‐

Apr‐13The rSmart Group, Sakai Division

Asahi Net International, Inc.

An online application that offers support for teaching and learning, project collaboration and group interaction.

‐ ‐ ‐

Apr‐13 LiveMocha, Inc. Rosetta Stone Ltd. An online language learning community. $8.5 2.4x ‐

Apr‐13WorldPass Travel Group, LLC

WorldStrides, LLCOffers student travel programs focused on education, leadership, sports, music, and dance.

‐ ‐ ‐

Mar‐13Learning Catalytics LLC

Pearson plc Develops cloud‐based learning analytics and assessment systems for educational institutions.

‐ ‐ ‐

Mar‐13OnlineTutorSolutions.com

Credo Reference Ltd. Provides online tutoring services to students. ‐ ‐ ‐

Mar‐13McGraw‐Hill Education, Inc.

Apollo Global Management, LLC

Offers educational materials and learning solutions for students, instructors, professionals, and institutions.

$2,548.0 1.2x 6.9x

Mar‐13 PlaySay, Inc. Lesson Nine GmbHDevelops language learning mobile software products and applications.

‐ ‐ ‐

Mar‐13 Late Nite Labs LLCMacmillan New Ventures, LLC

Provides online chemistry and biology laboratory simulations for high schools, colleges & distance learning.

‐ ‐ ‐

Mar‐13 Lore, Inc.Noodle Education, Inc.

Provides a cloud‐hosted service for instructors to manage their courses and engage their students.

‐ ‐ ‐

Mar‐13 Wiggio Inc.Desire2Learn Incorporated

An online toolkit that enables users to work in groups. ‐ ‐ ‐

Mar‐13 Root‐1, Inc. Edmodo, Inc.Offers a free platform that allows teachers to customize education apps.

‐ ‐ ‐

Mar‐13 SchoolRack Leading CapitalA learning management system for classes with discussion boards, grades, assignments, and messaging.

‐ ‐ ‐

Feb‐13Incentive Publications, Inc.

World Book, Inc.An educational publishing company, produces books dedicated to research and practical classroom know‐how.

‐ ‐ ‐

Feb‐13 Nutmeg Media, LLCDreamscape Media LLC

Develops and produces children’s picture books‐on‐video for children in the pre‐school through early primary grades.

‐ ‐ ‐

Feb‐13 ActiveGrade, LLCHaiku Learning Systems, Inc.

Operates an online standards‐based gradebook for teachers to provide their students with effective feedback.

‐ ‐ ‐

Feb‐13Innovative Interfaces, Inc.

JMI Equity; HGGC, LLC

Provides technology and services for libraries in the US and internationally.

‐ ‐ ‐

Jan‐13Groupe Modulo Inc.

TC Media, Inc.Publishes French language textbooks for the K‐12 and post‐secondary markets.

‐ ‐ ‐

Jan‐13Burlington Day School, Inc.

The Elon SchoolAn independent school serving children ages three through eighth grade.

‐ ‐ ‐

Jan‐13 Tutor.com, Inc.IAC/InterActiveCorp (NasdaqGS:IACI)

Provides online tutoring, homework help, and professional training & development services.

‐ ‐ ‐

Jan‐13Knowledge Mosaic, Inc.

LexisNexis Group Inc.Provides online information resources to academic institutions and corporate & government markets.

‐ ‐ ‐

Jan‐13Maupin House Publishing, Inc.

Coughlan Companies, Inc.

An independent, family‐owned publisher specializing in K‐12 teacher resources.

‐ ‐ ‐

Jan‐13Calvert Education Services

Camden Partners Holdings, LLC

Comprises a 100‐year‐old distance learning business. ‐ ‐ ‐

Jan‐13Invo HealthCare Associates, Inc.

Post Capital Partners

Provides outsourced clinical services to schools, school districts, and early intervention agencies.

‐ ‐ ‐



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CAPSTONE PARTNERS: A SAMPLING OF COMPLETED EDUCATION & TRAINING TRANSACTIONS

Capstone Partners maintains the most active education & training practice in the middle market, having represented

clients across various specialties, from education technology and service providers to educational programs. Capstone

Partners won the 2013 M&A Deal of the Year award for its work on the sale of Invo HealthCare Associates, a provider of

clinical services to schools, school districts and early intervention agencies throughout the US. Capstone’s consistent

market presence allows us to provide education companies with real‐time transaction feedback and immediate access to

key decision makers among the industry’s most active acquirers and investors.

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CAPSTONE PARTNERS: A SAMPLING OF COMPLETED EDUCATION & TRAINING TRANSACTIONS (CONTINUED)



Eric Williams, Managing Director

[email protected] • (215) 854‐4065

Eric serves as Managing Director and Head of the Eastern Region for Capstone, based out

of Philadelphia. Prior to Capstone, Eric was responsible for managing the Eastern region

for Morgan Stanley Smith Barney’s Capital Strategies Group and its predecessor, Citi

Capital Strategies. Eric has 20 years of experience managing strategic sale assignments

and leveraged recapitalizations for owners of privately held companies.

Eric has successfully completed over 100 transactions in industries including education

and training, health care services, and medical technology outsourcing,. In 2013, he

received the “M&A Deal of the Year” M&A Advisor award for his work on the acquisition

and majority recapitalization of Invo HealthCare Associates, Inc., a provider of

outsourced special education services to schools, school districts and early intervention

agencies throughout the U.S. He has also executed complex cross‐border transactions

with foreign buyers based in London, Germany, Sweden, and Switzerland and has

structured deals with leading private equity groups and strategic corporate buyers. He

graduated cum laude from the University of California and is a Series 7 and 63 Registered

Securities Representative as well as a Series 24 Registered Securities Principal.

Jacob Voorhees, Director and Principal, Head of Education Practice


Jacob is a founding member of Capstone Partners. He focuses on asset positioning,

strategy articulation, due diligence and negotiations coordination. Formerly, Jacob was

with Andersen Corporate Finance LLC, where he focused his efforts on the software and

direct marketing industries. He started his career in New York City with Rabobank

International, a multi‐national Dutch investment bank headquartered in Utrecht, the

Netherlands. While at Rabobank International, Jacob worked in the mergers and

acquisitions group focusing on cross‐border transactions in the consumer products, food

and beverage industries.

The M&A Advisor named Jacob to its prestigious 40‐UNDER‐40 deal makers list in

2012. Jacob received an MBA from the Sloan School of Management at Massachusetts

Institute of Technology (MIT) and a BS from Cornell University. Jacob is qualified as a

General Securities Representative.



THE EDUCATION TEAM

Mark Surowiak, Director


Mark is a Director in the Philadelphia office, supporting the management of the Eastern

Region. Previously, Mark served over 10 years as a senior investment banking

professional in Morgan Stanley Smith Barney’s Capital Strategies Group. Over his career,

Mark has focused on developing deep credentials and expertise in the sale and

recapitalization of privately held businesses. Mr. Surowiak's experience spans a broad

range of industries, including the education, government and defense contracting,

manufacturing, and outsourced business services sectors. Prior to investment banking,

Mark enjoyed a career in the social services field. Mark is a graduate of Illinois State

University with a BS in Business Administration. He is a Series 7 and 63 Registered

Securities Representative.

Sophea Chau, Vice President


Sophea joined Capstone in 2008 and specializes in mergers & acquisitions, private

placements and financial advisory services. Her responsibilities include providing

financial and valuation analysis, performing due diligence and drafting all marketing

materials. Prior to joining Capstone, Sophea was an analyst at FTN Midwest Securities, a

full‐service investment banking firm based in Cleveland. While working in their New York

office, she focused on M&A advisory for middle‐market companies in a variety of

industries, including education, healthcare, pharmaceutical services and marketing &

advertising. Sophea is on the Board of the Columbia University Club of New England and

is the Chairperson of the Boston Columbia College Young Alumni group. Sophea holds a

Bachelor of Arts in Economics from Columbia University.

Daniel Schultz, Director of Business Development


Dan oversees Capstone’s national business development and industry coverage

activities, working closely with current and prospective clients of the firm on matters

related to corporate sales, recapitalizations, mergers & acquisitions and growth

financings. In his role, Dan is able to deliver specific market intelligence to clients

regarding M&A, financing, strategic, industry and competitive trends. Prior to

spearheading the firm’s business development and market initiatives, he was a Vice

President in Capstone’s M&A group, managing numerous successful transactions across

a variety of industries. Dan also gained hands‐on transaction experience as an

investment banker at Headwaters MB. He started his career with Ernst & Young’s

National Professional AABS practice and later worked in Assurance and Advisory Business

Services in the Denver office. Dan received a BE in Biomedical Engineering with a

Business Minor from Vanderbilt University. He earned an MBA and a Master of

Accountancy from the Daniels College of Business at the University of Denver.



THE EDUCATION TEAM (CONTINUED)

ABOUT CAPSTONE PARTNERS

Capstone Partners LLC is a premier investment banking firm dedicated to serving

the corporate finance needs of middle market business owners, investors and

creditors. The firm provides corporate sale & divestiture, merger & acquisition,

private placement, corporate restructuring, valuation and financial advisory

services. Capstone maintains various industry specialties including one in

Education & Training. The firm also has a merchant banking capability to actively

co‐invest in transactions. Headquartered in Boston, Capstone has offices in

Chicago, London, Los Angeles, Philadelphia, San Diego and Silicon Valley.

© 2014 Capstone Partners LLC. All rights reserved.

World Class Wall Street Expertise. Built for the Middle Market.

CAPSTONE’S LEADERSHIP TEAM

NATIONAL

John Ferrara

Founder, President

(617) 619‐3325

[email protected]

CHICAGO

Ted Polk

Managing Director

(312) 674‐4531

[email protected]

LOS ANGELES

David Bench

Managing Director

(949) 460‐6431

[email protected]

SAN DIEGO & SILICON VALLEY

David Michaels

Managing Director

(858) 926‐5950

[email protected]

BOSTON

Jacob Voorhees

Managing Director

(617) 619‐3323

[email protected]

LONDON

John Snead

Managing Director

+44 7979 704302

[email protected]

PHILADELPHIA

Eric Williams

Managing Director

(215) 854‐4065

[email protected]

CORPORATE RESTRUCTURING

Brian Davies

Managing Director

(617) 619‐3328

[email protected]

For more information about our

expertise, please visit

www.capstonellc.com

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