BOSTON — Jan. 21, 2021 — Workforce development pioneer Penn Foster today announced a significant new investment from BayPine and Two Sigma Impact to accelerate the build-out of its digital learning platform focused on preparing frontline workers to thrive within high-growth, high-skill jobs. The two investment businesses will partner with Penn Foster to bring new capabilities in data science and advanced technology to help the company continue to offer practical, affordable solutions to its students.
“Skill gaps and economic mobility are, in many ways, two sides of the same coin,” said Frank Britt, Chief Executive Officer of Penn Foster. “This investment reflects our belief that the combination of advanced labor market analytics with low-cost digital training can help individuals make better-informed decisions about their educational investments. It’s about enabling employers to close skill gaps by identifying and creating career paths for historically untapped talent.”
A digital learning platform that works in partnership with employers, public workforce agencies, and community-based organizations, Penn Foster delivers skill-based training for more than 300,000 working learners each year. In addition to offering accredited programs and certificates in fields ranging from healthcare to skilled trades, Penn Foster partners with major employers, including Lowe’s and Walmart, to provide high school diploma and career training courses that are often on-ramps to higher wage roles.
“Two Sigma Impact believes that by focusing on creating a better workforce, we can create long term value and better business outcomes,” said Ian Blasco, Partner at Two Sigma Impact. “We are excited to work with Penn Foster to apply advanced data science techniques to the development of dynamic, skills-based training that is tightly coupled with the demands of the labor market.”
“For decades, Penn Foster has been at the forefront of delivering flexible, affordable, and job-relevant development programs that have redefined the intersection of education and work,” said Anjan Mukherjee, Managing Partner at BayPine. “The implementation of digital transformation initiatives to unlock human potential is core to our thesis, and we look forward to working closely with management to develop a modern, agile platform at Penn Foster that leverages the power of data to drive better outcomes for working learners.”
In “Unstuck in the Middle,” a white paper released by Penn Foster last year, the company made the case that recognizing skill attainment along a spectrum could unlock economic mobility for workers employed in jobs that require more than a high school diploma but not a four year degree. According to the National Skills Coalition, while middle-skill jobs make up the largest portion of the US labor market, just 44% of workers are currently trained to the middle-skill level. A recent study published by the nonprofit, Opportunity@Work, suggests that the estimated 71 million Americans who lack four-year degrees, but are “Skilled Through Alternative Routes” (STARs), represent an untapped pool of talent for US employers.
“The critical need for different ways to approach training and education for workers has become more prominent in the past few years, and the pressure on our economy created by the pandemic has only emphasized that the time has come for a workforce transformation,” said Ann Ruble, Operating Partner at Two Sigma Impact. “New data-driven approaches to learning will help expand access to training in high-demand fields for both workers and employers at a time when it is needed most.”
This investment represents the next phase of Penn Foster’s growth following a successful partnership with Bain Capital Double Impact, the impact investing unit of Bain Capital. Terms of the transaction were not disclosed. Macquarie Capital served as financial advisor and William Blair & Company as co-advisor to Penn Foster. Everberg Capital also participated in the transaction. Jamieson provided transaction management advice.
About Penn Foster
Penn Foster is bridging the gap between education and economic opportunity to build tomorrow’s workforce. We partner with employers, education and workforce organizations, and local community groups to design and deliver digital and blended learning programs that attract, upskill, and retain workers in America’s fastest-growing fields and professions. With more than 40,000 graduates each year, Penn Foster helps individuals discover pathways to opportunity through accredited diploma, certificate and degree programs that matter in the world of work. For more information, visit https://www.pennfoster.edu.
BayPine is a private investment firm that seeks to create lasting value for the firm’s investors, portfolio companies and communities in which they operate by driving innovation, digital transformation and sustainable growth in market-leading businesses across traditional sectors of the economy. Headquartered in Boston, BayPine was founded by a team of accomplished investors and senior executives who have a shared passion for building enduring companies. For more information about BayPine, please visit www.baypine.com.
About Two Sigma Impact
Two Sigma Impact is a business of Two Sigma. Its mission is to combine active, principled ownership and data science with the goal of achieving superior returns and positive social outcomes. The Two Sigma Impact team is focused on workforce impact – where they anticipate innovative and thoughtful investments in humans will lead to an enhanced employee experience, productivity, and long-term financial returns. As part of Two Sigma, Two Sigma Impact has access to expertise in data science, technology, and a range of corporate specialties, and seeks to support its portfolio companies with those resources.