In January I had a chat with Gary Flake CEO at Clipboard, a company then being touted as an exciting edtech start-up – TechCruch described them ‘as a cross between Evernote and Pinterest’. It was an interesting conversation, but I didn’t write anything the time because I didn’t get any clear indication about:
- How Clipboard was going to be an edtech business
- How they planned to compete with Pinterest $340m/£220m funding, 45m+ users and $2.5bn/£1.6bn valuation or Evernote $250m/£162m) funding, 40m+users and $1bn/£650m valuation or Moxtra (something I have been trying) ?
- What value (beyond cash) their January investment from UK-based Scienta brought
- Why they hadn’t tapped their original A-list investors like Andreessen Horowitz, Index Ventures, Crunch Fund, SV Angel, Draper Fisher Jurvetson etc.?
Given all my concerns I wasn’t surprised to learn Clipboard that had been acqui-hired by salesforce.com for $12m/£7.8m and was being closed down. While this isn’t the exit Flake probably had in mind back in 20011, it embeds his team with a much stronger large corporate and delivers his investors a pretty good R.O.I.
Perhaps the most important thing to take from this is whether for many edtech start-ups, their greatest value lays in their talent not their tech (another recent example being edmondo’s acquisition of Root-1)?
The difference is that most people I meet in edtech are primarily motivated by making a difference in education via their product or service, rather than thinking about their exit. Equally there are probably some edtech start-ups whose exit strategy is aqui-hire rather than building a product or service.
Let’s be clear, I’m not saying aqui-hire good or bad in edtech, it’s just a bit unusual and I offer my sincere congratulations to Gary Flake and to Root-1’s co-founders Manish and Katan Kothari, for their achievements.
- Nov. 2001 Clipboard raises $1.5m (£975k) from A-list investors
- Private beta Dec. 2011 to May 2012
- Nov. 2012 Clipboard raise an estimated $1.4m (£900k) from Cambridge-based Scientia
- Feb. 2013 140,000 users with 2m clips
- May 2012 sold to salesforce.com for an estimated $12m (£7.8m)