Deep Dive: Guild x Nomadic

And funding activity abroad is promising

What We’re Talking About

Guild is acquiring Nomadic, a platform that lets companies build their own digital academies. Nomadic is also home to the Josh Bersin Academy, which hardcode HR professionals use. The acquisition will lead to the creation of Guild Academy, which will be focused on improving the type of corporate training that pretty much every employee of an SMB has to take (adding things like cohorts, practical applications, etc.). It’ll also hopefully allow Guild to upsell to Nomadic’s clients, such as AB InBev, and Guild Academy to cross-sell to Guild’s existing customer base. Interestingly, one of Nomadic’s bigger customers, Accenture, is busy building a possible competitor to Guild, LearnVantage and Accenture Academy.

I think this acquisition is promising for one big reason: It increases the addressable market for Guild dramatically through horizontal expansion. Guild’s current upskilling solution is fine. It’s nice being a platform company making money off of both sides of the market, but there’s a large dissonance between companies saying they’re focused on upskilling, and the number of companies actually increasing their L&D budget or investing in education benefits. And then even among the ones that do, uptake for an employee-sponsored education benefit is still small–just a few percentage points at most. At Guild (and like so many startups and unicorns at the time), it felt (even to someone with equity in the company) that the valuations were wildly off base, given that constraint.

But everyone has to take HR trainings. And while not necessarily incorporated into the flow of work (the ideal type of training / upskilling), these HR trainings are required, reoccurring events (I currently have a data & privacy training in my docket).

What’s Happening in the Market

Funding rounds in the US and other more mature economies might be few and far between, but we’re seeing a lot of smaller activity in emerging economies:

• NextEra Education was launched last month in Egypt with $41M to reimagine learning in the country (partnering with Western universities and coding camps to provide degrees and certifications).

• Voovo, a microlearning (aka, flashcards) startup in Hungary just raised a pre-seed €500K (led by Techstars) in October.

• Youni, a Romanian startup, raised a $1M seed round last month from it’s pre-seed investors. Youni helps universities (including ones in the US) automated parts of the admissions process.

The list goes on.

In some of those mature markets, we’re still seeing jumbo rounds and M&A return, like PhysicsWallah’s wopping $210M round last month or KKR’s Instructure acquisition two months ago, but we’ve been talking to founders who are opting to bootstrap for longer instead of raising capital in a higher rate environment.