Degreed Buys Pathgather, Heats Up Battle for Modern Learning

by Jim Lundy and Nicole Speciale

On June 20th, 2018, Degreed announced that it is buying Pathgather, an emerging provider of modern learning. This merger bolsters Degreed overall and is probably a good exit for Pathgather, which is New York-based and gives Degreed an important location on the East Coast of the U.S.

This blog discusses the purchase, its effects on the learning market, and how new learning technologies are going beyond traditional learning management systems.

Modern Learning: Leveraging Content to Build Skills

Modern learning goes beyond learning management systems (LMS’s) by aggregating huge volumes of outside content so that they can be leveraged within enterprises, instead of just software-based learning systems.

The focus of a modern learning platform is to provide more personalized learning experiences and offer insights into learning progress so management can support the growth of its teams. Corporate learning has taken off in new ways and the shift away from LMS’s and toward modern learning is a huge part of this.

Degreed’s Growth Isn’t Slowing Down

In March 2018, Degreed announced that it had raised $42 million in funding after a three-year growth period, and promoted COO Chris McCarthy as CEO. Now with Pathgather joining Degreed, Degreed will continue to enhance its offering and expand.

Pathgather is known for its easy-to-use learning offering that integrates disparate components into one point of access. Degreed aims to deliver innovative ways to enhance, analyze, and communicate the skills people have; now that these firms are merging, the demand for a modern learning approach will continue to grow.

Degreed’s Focus on Skills and Content

Part of the attractiveness of Degreed is the large amount of off-the-shelf content it can aggregate and serve on behalf of the enterprise. At a recent event, many CLOs (chief learning officers) indicated to Aragon privately that they were looking to add platforms like Degreed to augment their existing learning provider, which is often labeled as an LMS provider.

Our take is that the spending on learning content is exploding—part of the spend is on video content—and this shows no sign of slowing down.

Aragon on Content Spending

For years, we have talked to clients about the need to have a robust content strategy when it comes to corporate learning. What Degreed has done is to make it easy to get access to a lot of content from multiple providers, but others are doing this, too.

Aragon feels that the spending on content in the enterprise will exceed $600 billion in 2018 and up to half of that is on training-related content. Video is the other part of modern learning that is driving the overall content spending.

Video Learning Is Taking Off

The era of video learning is here. Many of the emerging learning providers like Degreed focus on content aggregation, but not as much on video learning. This is a critical area for L&D teams not to miss. Being prepared to manage the onslaught of user-generated video content is vital.

Modern Learning Is an Evolution of the LMS Market

While our friend Josh Bersin is describing providers like Degreed as learning experience platforms, we describe what is happening as an evolution of the current corporate learning market—hence the term modern learning.

One of the differences in our description of the market is that things such as social learning (via communities) and video learning are critical components; it’s not just about third-party content aggression.

Learning Providers Are Evolving Quickly

Some CLOs have asked me if they should turn off their LMS provider and our take is no. The reason is that most are updating their overall platform.

Skillsoft, which has one of the largest content libraries, has done this and so has Cornerstone OnDemand. Others like D2L and Peoplefluent have robust video learning capabilities and Saba recently added video learning as well. Many vendors are working hard to expand their content libraries, so looking at the terms of their licensing agreements for content will be critical.

Bottom Line

The learning market is evolving and Degreed is making its mark with a new focus on skills and training outcomes, and with more of an all-in-one approach to a bundled learning offering.

As more providers aim to enhance their offerings with new technologies, enterprises will continue to have more options to evaluate than just a learning management system. Aragon discusses all of this and the strengths and weaknesses of major providers in our fifth Aragon Research Globe™ for Corporate Learning.

Editor’s Note: Aragon Research will be featured in a modern learning webinar this week. Register now to learn how to create a modern learning experience for your enterprise.