Chegg Buys Zinch in Another Move Toward a “Social Education Platform”
Chegg — best known for online rentals of textbooks to college students — said it has just bought Zinch, a start-up that links high school students and college recruiters.
Terms of the deal were not disclosed.
The purchase of the San Francisco-based Zinch, said CEO Dan Rosensweig in an interview earlier this week, is part of a larger plan involving a series of acquisitions aimed at “how we move from two-day relevance to relevance all year around for students.”
By that, he meant the short time period when students either buy or rent their textbooks for the semester.
That’s certainly been a good business for Chegg, which is the leader in the online textbook-rental arena, including digital distribution.
But to further solidify its relationship with students and expand its market base to include high schoolers along with college consumers, Chegg has picked up a number of start-ups like Zinch, using its stock and also the whopping $220 million in funding from a number of venture firms, including Kleiner Perkins.
In late September, for example, the company bought CourseRank, which helps students share course schedules, take classes with friends, and read and write reviews on classes and professors, as well as find out how they grade.
Also scooped up by Chegg: Notehall, which is a student-to-student note-taking trading market; Cramster, a social homework helper; and Student of Fortune, a homework-answers site for student questions (which a recent filing by Chegg noted was bought for $5.9 million in stock).
Also being tested are such offerings as deals for students and other ways to leverage the original textbook relationship.
“This is the beginning of a connected student network that we hope to build into a giant platform,” said Rosensweig. “We want to have a student using us all the way through for a 10-year span, from high school on.”
In related news, Chegg said it has hired former Palm CFO Andrew Brown as its new CFO. Prior to Palm, he served as the CFO of Pillar Data Systems Inc., a storage start-up funded by Oracle’s Larry Ellison.
While a CFO hiring often indicates a soon-to-happen IPO, Rosensweig said that Chegg has more than enough capital, needs to focus on building up its offerings and is in no rush to go public.
We’ll see, but here’s the official press release from Chegg about Zinch:
Chegg Plans to Expand into $7 Billion College Recruiting Market and Increase Student Base By Over 3.5 Million
Chegg enters into a definitive agreement to acquire Zinch, the leading digital network that helps high school students research, connect with and pay for college
SANTA CLARA, Calif., September 15, 2011 – Chegg today announced it has entered into a definitive agreement to acquire Zinch. The acquisition is subject to standard closing conditions and is expected to be completed by the end of this month. The acquisition will expand Chegg’s social education platform into high schools. Zinch, founded in 2007, connects prospective college and graduate students to scholarships, admissions officers and other students who have been through the same process.
The acquisition of Zinch, with over 3.5 million members, $1.9 billion in scholarships and over 5,000 school profiles, will significantly expand Chegg’s customer base and its social education platform. Colleges and students will be able to connect more effectively for less through Chegg, helping to streamline the college recruiting process globally. In addition, unlike any other company in the education space, Chegg will provide resources to students at every major milestone before, during and after their college career — including bridging the gap from high school to college.
“Our mission has always been to save students time, money and help them get smarter,” said Dan Rosensweig, president and CEO of Chegg. “With our acquisition of Zinch, we’re extending our mission to high school students through the $7 billion college recruiting market, while continuing to break down the barriers of a college education, from the high cost of tuition and textbooks to helping students make money, pick their courses and get the academic help they need.”
At Zinch, over 3.5 million students have built online profiles to showcase themselves as “more than test scores” to shine in the admissions process, and to be matched with schools and scholarships that might be a good fit. Colleges and universities worldwide, including more than half of the US News top ranked national universities, use Zinch for cost-effective student recruiting and outreach.
“Getting in and paying for school is daunting. Together, Chegg and Zinch can not only make higher education more affordable and accessible, it gives students an edge in finding the right school, getting admitted and reducing the cost. Students can put their best foot forward, be recognized for their achievements and be discovered by programs that fit their interests,” said Anne Dwane, CEO of Zinch.
The acquisition is subject to standard closing conditions and is expected to be completed by the end of this month.
To learn more about Chegg’s social education platform and its network of services, go to www.chegg.com.