Corporate Update: After months of media coverage about a potential go-private transaction for Blackboard, last week we closed the deal. Blackboard is once again a private company, owned primarily by Providence Equity Partners. Net effect? Our ownership is made up of a much smaller group of people who share a much more closely aligned idea of where we want to go as a company.
A First Strategic Impact – Blackboard deepens its K-12 bench: I’ve noted in an earlier post that one of the things that attracted us to Providence was their experience investing in education companies. One area of particular interest to us was Edline, a highly regarded purveyor of K-12 education platforms in use at over 20,000 schools in North America. Our team had actively sought a partnership with Edline to assist us in our own growth in K-12. We’re big fans of Edline’s learning community management platform, and its excellent school portal and parental communication tools. And Providence has been seeking to extend Edline to support more advanced learning management, online collaboration, and mobility support. This is the basis for our first major event as a private company. With assistance from Providence, Edline is now a part of Blackboard and significantly strengthens our K-12 forces and offerings. More importantly, we’ll improve the value of the Edline offering to our K-12 clients sooner and with greater quality than could have otherwise occurred.
The Executive Team remains, but we have a new Board: The ownership structure for the company has changed, but the executive leadership team has not. Michael Chasen continues to serve as our President and CEO and as a director on our new Board. The rest of us are all continuing in our familiar roles, save for an expansion of the team to include Edline’s leader, Rick Noble. Our new board also includes the two Providence Equity team members who sponsored the investment in Blackboard, Peter Wilde and David Phillips. Our new Board Chair is Steven Alesio, formerly a CEO of Dun & Bradstreet and division president at American Express. Charles Gottdiener, also a Managing Director with Providence and formerly chief strategy officer at Dun & Bradstreet, rounds out the new Board. Peter and David bring a wealth of experience in education company management and strategic development, while Charles brings his perspective on long-term corporate strategy, corporate development and value creation. And already I can see that Steve will bring us much wisdom from his executive leadership with two highly trusted brands. He’s focusing first on ensuring we sustain upward trends in client satisfaction with our service levels. A close second is ensuring that we’re accelerating product innovations to market for the long term benefit of our clients. I think our clients will appreciate these points of focus on their behalf.
The Mission at Learn and our Back to School Performance against it: I’m now midway through my third year at Blackboard, during which I’ve tried to convince the world that Blackboard Learn is undergoing important changes. Our mission begins with service and a highly public commitment to create an experience of service that truly differentiates Blackboard Learn. It extends to how we conduct business, how well we listen, how well we design policy to reflect the values of the educators we serve. And especially how transparently we communicate about our decisions in this regard. Translating our mission into tangible product terms, we are re-engineering the LMS for its second decade with a real reverence for the time and delight of those who use it, the risk management of those who operate it, and the perspective on learning that institutional leaders who deploy it are more challenged to provide.
I’ve leaned on words to help me describe our vision, but the news of our deeds tells the tale about what’s really happening in Learn. Our back to school performance this year provides hard evidence of the changes in our business stemming from our mission. One statistic that pleases me well: we now resolve a higher percentage of service tickets on the same day they’re submitted than we cleared in a week just two years ago. I’ll reinforce that the scale involved is thousands of clients, in over 60 countries, and includes most of the largest and most mission-critical systems for online learning on the planet. Our managed hosting delivered an exceptional experience with 100 percent uptime in our datacenters around the globe, and less than 2 percent of more than 1,000 hosted clients experiencing any form of downtime. And as the vast majority of them are on our latest product version, with the latest service pack, this speaks well to the improving stability of our products. So our refinements are delivering real results. The blemishes that remain require refinement, and my team knows where and why with greater precision than ever due to wholesale changes in how we approach our work.
Providence impact on the Mission: I’ve been asked often in recent weeks what influence Providence may have on our strategic direction, and whether we’ll need to reduce investment to pay debt that’s been added to our balance sheet in this transaction. Especially in this climate of extreme risk avoidance, you can be sure that we have structured the debt so that our cash flows can support our repayment obligations without significant changes in how we budget for development and organic growth (and you can bet the banks have done their homework too!). Were it not Providence behind us, and the billions in committed capital they have at their disposal, our ability to invest in the future growth of our business could have been limited by a wide range of market forces beyond our control. But with them, and their commitment to invest for the long run, we’re restrained only by the quality of the opportunities we find and the limits of the vision we develop for our role in education.
Just as before, there will be areas in which we reduce investment, and there will be areas where we intensify it; but you can be sure that these decisions will be driven by long term expectations about what’s best for the business and our clients. Providence shares our belief that sustained execution and refinement in our core products is the best way to preserve and grow the investment they’ve just made. And I’m pleased to say that the type of progress in execution within Blackboard Learn I mentioned above fits squarely with the investment thesis at Providence. The improvements are paying off in improved satisfaction and growth. Providence believes as I do that the best days for Blackboard client experience are in front of us.
Forthcoming Announcement on Openness: A first test of our mettle as a private company is coming up next week at Educause, the major education IT show in North America, which is the latest stop where I’ll be sharing news about our new product innovations. But perhaps even more importantly, I’ll provide an update about how our vision about openness is evolving, and announce some new contributions to educators coming from Blackboard. For those of you attending EDUCAUSE, I speak on Wednesday, 11:30 a.m., in room 119B. I’ll also share an update on our news here on Wednesday or soon after.
As always, feedback welcome here and at [email protected].