As remote learning is becoming the only solution to move forward due to the COVID-19 pandemic, many ed-tech startups are trying to find different ideas to help teachers, students, and parents to navigate the new normal of teaching.
In a recent development, Norwegian game-based learning platform Kahoot has announced the acquisition of Drops, a company that teaches the essentials of language by combining word puzzles with visual association.
The acquired amount is $50M (approx €41.9M) with the acquisition of 100% of the shares in Drops. Kahoot is paying $31M (approx €26M) on a cash and debt-free basis, and the other $19M (approx €15.9M) if Drops performs well from 2020 to 2022.
Aim of the acquisition
This acquisition will help Kahoot to further expand its language learning platform for millions of its users globally as well as bring its learning to Drops users.
Speaking on the development, Eilert Hanoa, CEO of Kahoot says, “We are thrilled to welcome Drops to the expanding Kahoot family as we advance towards our vision to become the leading learning platform in the world. Drops’ offerings and innovative learning models are a perfect match to Kahoot’s mission of making learning awesome through a simple, game-based approach.”
“Drops and language learning becomes the latest addition to our growing offering of learning apps for learners of all ages and abilities. We will continue to expand in new areas to make Kahoot the ultimate learning destination, at home, school, or work, and to make learning awesome,” adds Hanoa.
The Tallinn, Estonia-based Drops was founded in 2015 by Daniel Farkas and Mark Szulyovszky.
The platform teaches the essentials of language – alphabets and vocabulary – by combining a colourful user interface and simple illustrations with visual association and using a game-based approach. With snackable, swipe-based word games, Drops keeps its users engaged and helps them forge the foundational 3Cs of language learning – core vocabulary, confidence, and consistency – while avoiding burnout.
The platform offers 42 languages and has 25 million users to date. Its app’s 5-minute sessions of swipe-based word games are fast, fun, and effective, claims the company.
The platform’s companion apps Scripts teaches learners how to read and write (and in the case of ASL, sign) 4 alphabets and four character-based writing systems; and Droplets is designed specifically to teach foreign languages to kids aged 8-17.
“We’ve introduced millions of users across the globe to our playful, dynamic approach to language learning. Kahoot is doing the same for all types of learning. We’re excited to work with such a mission-aligned company to introduce the Drops platform to game-loving learners everywhere,” said Daniel Farkas, co-founder, and CEO of Drops.
For 2019, the company’s gross revenue was €6.3M with approx. 40% cash conversion.
In 2012, co-founders Alf Inge Wang, Asmund Furuseth, Jamie Brooker, Johan Brand, and Morten Versvik established the company in Oslo. The technology is based on research conducted by Kahoot co-founder Morten Versvik for his Master’s degree at NTNU, who was a student of Professor Wang’s at the time. Kahoot was launched in private beta in March 2013 at SXSWedu. In September 2013, the beta was opened to the public.
The company provides a game-based learning platform that makes it easy for any individual or corporation to create, share, and play learning games that drive compelling engagement.
The company is headquartered in Norway with offices in the US, the UK, France, Finland, Denmark, and Spain.
According to the company, in the last 12 months, more than 1 billion participating players in over 200 countries attended over 200 million Kahoot sessions. The acquisition of Drops is part of Kahoot’s strategy to expand into new areas of learning, making it a trusted destination for all learners.
Earlier in October, the company raised $215M (approx €183M) from SoftBank, to finance its accelerated growth through value-creating non-organic opportunities and continue to build a unique platform company.
Also in October, Kahoot released its Q3 earnings. It said it invoiced revenue of $11.6M (approx €9.8M), up 240% increase in the same quarter a year earlier. It had a positive cash flow of $5.2M (approx €4.4M) from operations, compared to $-0.6M (approx €511K) in Q3 2019, and had 360,000 paid subscriptions, up 160% on the year earlier.
In September, Kahoot had acquired Danish startup Actimo, an employee engagement platform, to boost its corporate learning business. The company is headquartered in Norway with offices in the US, the UK, France, Finland, and Poland.
Image credit: Kahoot!