GeoLearning announced a “growth equity investment” in the form of $31 million large from Fidelity Ventures. Here is what I don’t get…
- Fidelity Employer Services Co (FESCo), another Fidelity business, has a long standing relationship with Saba as one of their key partners. Saba is a key competitor to GeoLearning. Sure, Fidelity Ventures has a different business model than FESCo but it makes no sense to me that a company (even the size of Fidelity) chooses to invest in a competitor of one of their key partners.
- The learning management (LMS) space has proven challenging to grow and make money. Saba and SumTotal, the market share leaders in learning, have struggled for years to achieve profitability. Most learning management vendors (with the exception of Cornerstone OnDemand and Plateau) have also struggled to sell and deliver functionality outside of learning, such as performance management. Why such a large investment in a struggling (some would say dying) LMS market?
- From all indications, GeoLearning’s recent release, GeoMaestro 5 series, has some deployment issues.
- $31 million is a lot of money to raise for a large stage company. With Fidelity presumably owning a large stake in the company now, should this be concerning to customers? I think so!
- Contrary to the press release, GeoLearning is not a pure-play SaaS vendor. They still deliver an ASP-hosted solution which is not as attractive a delivery model for customers or shareholders.
- Past experience suggests the learning management market gets hit hard in a recessionary economy. A survey published today from top economists predict recession likely in 2008.
Am I missing something?