The Race to Own SCL: Showpad Buys LearnCore for $50M

by Jim Lundy

Showpad announced last week that it is buying Chicago-based LearnCore, an emerging Sales Coaching and Learning (SCL) provider. The estimated price is reported to be $50 million, which to Aragon, represents a significant multiple over LearnCore’s revenues.

Why Did Showpad Buy LearnCore?

Showpad is one of the leaders in Sales Engagement Platforms (SEPs). Sales Coaching and Learning (SCL), a market that Aragon has separated from corporate learning, is growing and this gives Showpad a larger set of offerings to sell to sales enablement decision-makers.

Other SEP providers have been partnering with SCL providers. This move could create a new race to consolidate the SCL market just as it is getting started.

SEP Providers Want to Grow Via Acquisition

The other reason that Showpad bought LearnCore is to enable it to compete against other leading providers. Showpad’s primary investor Insight Venture Partners, just invested another $25 million in January. That gave it a larger war chest to make more acquisitions. Seismic just bought Chicago-based Savo Group (see our blog, Seismic Buys Savo Group as Sales Engagement Enters a Consolidation Phase) and that makes Seismic one of the largest SEP providers.

The LearnCore deal is more of a technology buy, but the demand for Sales Coaching and Learning is expected to surge over the next five years.

Will the LearnCore Deal Mark a Consolidation of the Sales Coaching and Learning Market?

With the exception of Boston-based Brainshark, most of the Sales Coaching and Learning providers are only a few years old. SEP providers are looking to expand their revenues and Sales Coaching and Learning is a no-brainer.

Even Salesforce sees this trend and its myTrailhead sales training offering is planned to be available later in 2018. That said, don’t count out major learning providers making moves here, including Cornerstone OnDemand. Some of the SLC providers that could be acquired include:

• Allego
• Brainshark
• MindTickle
• Qstream
• SalesHood

Up Next for Showpad

Showpad was one of the pioneers in making acquisitions to grow its top line. The LearnCore deal expands its product feature set and positions it well for the bifurcation of the learning market (SLC is poised to separate from corporate learning).

It is clear that Showpad co-founders Pieterjan Bouten (CEO) and Louis Jonckheere (CPO) are still firmly in control of their firm, despite former Marketo executive Jason Holmes joining as president and Theresa O’Neil joining as CMO. We don’t expect Showpad to stop with its acquisitions but that means it will need higher revenue or more investment.