Newsela Acquires Interactive Video Platform

YouTube's Prominence in Schools Drives Newsela Acquisition

According to Matthew Gross, CEO and co-founder of Newsela, YouTube ranks as the third most frequently utilized website within educational institutions.

Gross highlighted the surprising statistic, noting the difficulties in locating videos, the lack of filtering, and the inaccessibility for students with diverse learning needs and levels. He emphasized that the format of video learning requires evolution.

Newsela Acquires HapYak

In response, Newsela announced the acquisition of HapYak, a provider of interactive video software for businesses, for an undisclosed sum. This represents Newsela’s inaugural acquisition, shifting its focus from content partnerships and licensing towards direct investment.

The move follows a recent $100 million funding round that valued Newsela at $1 billion.

Gross explained that HapYak offers more sophisticated features than YouTube for enterprise applications. He noted that user demand for interactive video creation tools validated the importance of this functionality.

Aligning with Newsela’s Core Philosophy

The acquisition aligns with Newsela’s ethos of providing customizable learning experiences. Like its disruption of traditional textbooks by offering online, adaptable content, Newsela aims to revolutionize video learning through interactivity.

Newsela also intends to leverage its existing access to thousands of videos obtained through content provider agreements.

Engagement and accessibility are key benefits, according to Gross. He stressed the need for videos to be accessible to students of all backgrounds, learning levels, and abilities.

Subscription Model and Accessibility Concerns

Gross refrained from commenting on whether video features will be available to free users or exclusively to paying subscribers. This decision could impact accessibility, given the ongoing digital divide affecting student access to software.

Newsela reported an 81% increase in annual recurring revenue in 2020 compared to 2019, with a 115% surge in new bookings. The CEO did not disclose whether 2021 performance will match or exceed these figures.

A Shift Towards Video Content

Historically, Newsela has primarily focused on text-based content, prioritizing student literacy. However, the company now recognizes video as an essential component of modern learning.

“Video is central to instruction and efficiently conveys information,” Gross stated. He views video as a valuable supplement to text, not a replacement.

Avoiding Superficial Engagement

Gross acknowledged that Newsela intentionally avoided focusing on video in the past. He expressed concern about low-quality, engagement-focused videos lacking pedagogical rigor.

He cautioned against tools that prioritize engagement metrics over genuine educational value, emphasizing the importance of balancing captivating content with sound learning principles.

“We need learning that prepares students for the 21st century,” Gross said, “and video should inspire a genuine excitement for learning.”

Expanding AI Capabilities

In addition to the HapYak acquisition, Newsela has acquired natural language processing AI assets from Fluent City, a language learning company. This acquisition will enhance Newsela’s ability to analyze and curate content from its providers.

These acquisitions demonstrate Newsela’s proactive approach to delivering the right content, in the optimal format, to each student at the appropriate time, supported by its recent funding.

Note: A previous version of this article incorrectly stated that Newsela sold Fluent City assets to Brightcove. The correct information is that some HapYak assets were sold to Brightcove. This has been updated for accuracy.