Apollo Group goes to school with Carnegie Learning


Aug 8, 2011

Apollo Group, owner of the University of Phoenix, announced recently that it agreed to acquire Carnegie Learning, which offers computer-based math instruction based on solid brain research from scientists at Carnegie Mellon University. You can also read more about the $75 million acquisition here.

My first impression was that this is a great exit for Carnegie Learning—an innovative learning technology that struck me as being stuck with a tough business model that wasn’t disrupting the classroom model, but instead trying to enhance it—and thus would likely face a difficult road ahead.

My second question then was that if this was a great exit for Carnegie Learning, what would it do for the Apollo Group? Beyond improving its reputation with regulators with the acquisition of a serious and reputable learning technology, the answer seems to be that it gets them access to a valuable set of resources, namely the proven technology behind Carnegie Learning. Already the piece in the New York Times references how Apollo’s CEO believes that incorporating Carnegie Learning’s solution into its proven business model will help University of Phoenix’s students have better outcomes in math—which should mean that fewer of them will drop out.

In addition, the eSchool News article alludes to how the acquisition will allow Apollo to “accelerate its efforts to incorporate adaptive learning into its academic platform”—an exciting venture that makes the University of Phoenix a serious player in advancing the future of learning.

There will of course be significant challenges here. Mergers and acquisitions are always tricky—I highly recommend this piece on thinking through them—and integrating the resources into an existing model may be a challenge. There will also be questions as to how to handle Carnegie Learning’s existing business model. But the upside for Carnegie Learning—and the researchers at Carnegie Mellon University—is that this fascinating technology they have commercialized is now on a sustainable footing that has the promise of scaling even further to touch the lives of millions of students. Not a bad outcome at all.

Michael is a co-founder and distinguished fellow at the Clayton Christensen Institute. He currently works as a principal consultant for Entangled Solutions.