By Jim Lundy
Cornerstone, the Learning and Talent Management firm, has been a busy company after being sold to Private Equity firm, Clearlake, in 2021. That all followed the X deal to buy its arch-rival in learning, Saba. Now, Cornerstone is buying EdCast and it may or may not change the learning market. This blog analyzes the deal.
Analysis of the Deal: What Does Cornerstone Get With Edcast?
Will Conerstone’s purchase of Edcast change the education game?
The main asset Cornerstone gets from EdCast is a solid Digital Adoption platform (DAP). On its LXP – Aragon did not include EdCast in its Corporate Learning Globe because we did not find enough customers that were using EdCast outside of DAP. So, while EdCast has an offering, the challenge for Cornerstone will be merging it with its existing two platforms and deciding how much of EdCast is incorporated into its solid existing offerings.
While Cornerstone wants to add a bigger emphasis on skills and overall learning content, it already has a content group that is doing well. With EdCast – it will have to go out and sell the EdCast capabilities that are not integrated with CSOD – and it will have to sell against established competitors including Degreed and Skillsoft. Note, Cornerstone partners with Skillsoft and resells their content.
Did Cornerstone Act Too Soon?
The EdCast deal comes after the January announcement of a new Cornerstone CEO, Himanshu Palsule, who was put in the job by Clearlake Capital, which is relatively new to the Learning and Employee Engagement market. Our take is also that former CEO Phil Saunders, who is now an advisor to the company, would never have done this deal.
Cornerstone Has Bigger Integration Issues Than EdCast
Cornerstone, with its heritage in Learning and Talent – wants to make a bigger impact in the market but with the Saba merger not having occurred that long ago – Cornerstone still faces the issue of having two separate and distinct Learning Platforms. Our take is that the Saba Cloud Platform was more mature and fully Cloud enabled than Cornerstone, which was still on a multi-year migration from .Net to an Amazon AWS infrastructure.
Learning and Skills Development and Employee Engagement
The big change that is underway is that the overall Talent Management market is pivoting to a focus on Employee Engagement. Aragon has a Technology Arc that tracks all the major Learning and HCM technologies. Two years ago, we changed the name of that report from Learning and HCM to Employee Engagement and Learning.
In the skills area, it has become a core focus on Employee Engagement – and that is the rationale being used to justify the decision by Cornerstone to buy EdCast.
Enterprise Advisory – Lots of Options
After the deal closes, enterprises should evaluate the Cornerstone/EdCast offering versus other providers, such as Axonify, D2L, Degreed, Inkling, Meridian KS, Qstream and Skillsoft. Enterprises should also ask for a roadmap of planned product integrations.
Bottom Line
While there is a lot of hype surrounding the Cornerstone and EdCast deal, it is just that – hype. Cornerstone had a large platform integration issue before it bought Edcast – now it just gets more complicated. For those looking at Digital Adoption Platforms, the EdCast solution is a solid one and that does open up a new sales channel for Cornerstone.