the creativity to be able to engage the learner. So, while the tools for building e-learning courseware have become simpler to use, the expertise required to script and design truly effective e-learning remains scarce.


Merger mania


The trend for buyers to go through formal procurement for each e-learning project, some using intermediaries to manage the process, may favour established suppliers but it makes it difficult to establish long-term relationships and build repeat revenue streams. Bespoke companies need a constant stream of new business and with low switching costs this is not a recipe for stable growth. The result is very few of the early pioneers are still around, and there are a minuscule number of bespoke e-learning millionaires.


Who remembers Maxim, Knowledge = Power, Adval or more recently Intellego? Consider too the rather tarnished record of e-learning mergers and acquisitions. In 2005 alone, Huveaux took over Epic, Redtray bought BlueU, and Futuremedia acquired EBC, only to be taken over by Edvantage in 2008, which in turn were sold to Lumesse in 2011. Futuremedia’s ambition had included a public listing on Nasdaq. I hope you were prudent enough to resist the temptation to invest.


More recently we have seen Atlantic Link, Absolutely Training and Fuel swallowed up, the latter acquired in 2007 by LRN a US company whose purpose is “helping people around the world to do the right thing”. They are “not a business with a mission, but instead a mission with a business”, who “inspire principled performance through their core values of integrity, humility (!), passion and truth”. Hmmm, they certainly seem to be leveraging some impactful holistic paradigms there!


Epic is a notable survivor of the fallout from mergers and acquisitions, back on its feet as an award-winning independent business. Yet


Epic would readily admit to a narrow escape. The chequered history of M&As highlights there are few advantages in size, and management problems multiply as teams get larger and more dispersed. This ties in with another necessary element for long- term success – good leadership.


It’s a tough world out there and it does appear when companies lose their focus, as is almost inevitable in the shake up after a merger, they also lose their way.


Mould breakers? Which brings me neatly to a success story.


In recent years Kineo has made perhaps the most impressive effort to break from the pack, showing there is scope to establish brand value through substantial but well-targeted marketing spend and innovative leadership.


It donned the open source mantle as a differentiator, and its use of the franchising model to extend the brand internationally was a stroke of entrepreneurial flair. The strategy has earned the founders a windfall with the sale of the business, but is it a replicable route to long-term profitable growth? Will Kineo keep its focus post-merger?


Time will tell.


So, despite all this activity there is still no dominant force in bespoke e-learning. It remains highly price competitive, and resource constrained.


To the future


My prediction for bespoke companies is more of the same. The exponential rise of mobile platforms expands the market and brings in more players, but the basic economics are unchanged. We will continue seeing new entrants with new ideas and a low cost base challenging the established players in an increasingly global cottage industry.


5


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16