Arco Platform – Education Technology Company in Brazil

Education Technology Platform

Arco Platform Limited (NASDAQ: ARCE) is an education technology company established in Brazil in 2004. It provides high-quality educational contents and develops educational software for private schools from Kindergarten to grade 12. The number of students using Arco’s platform service increased by an average of 51% per year.

In 2018, Arco Platform went public in
NASDAQ under the symbol ARCE. The company offers educational solution to private schools throughout Brazil and has grown to a leading Edtech company in Brazil.

Arco Platform has achieved growing revenues and operating profits for the last three years.

The company’s net revenue hit 244.4 million Brazilian real by the end of 2017, and operating margin increased by 33.3% year-over-year.

B2B2C Business Model

The company offers high-quality educational contents at scale in both digital and printed formats to primary or secondary private school students through Arco platform to improve the learning process.

Pairing the printed and digital curriculum with real-time data allows the platform to personalize learning at the individual level, improving both individual student and aggregate school performance.

The company revenues consist of wholesale content fees paid by partner schools annually on a per-student, per-year basis. Partner schools charge students’ parents an incremental markup on top of the wholesale fees, and such payments are charged as a supplement to tuition.

Enrolled students in partner schools are increasing rapidly these years. The number grew by 2.6 times from 2015 to 2018. Currently the company serves more than 405 thousand students in 1,140 private schools throughout the country. Besides the number of enrolled students, an average ticket per-student per-year has increased in the last years.

There are over 40 thousand private schools in Brazil with more than 8 million students. Private schools are getting more popular in Brazil these days as they offer higher quality of education than public schools, which presents huge growth opportunity for their business.

The company’s net revenue has recorded 49% growth in Q3 2018 compared to the same period in 2017 and EBITDA rose by 36%.

To scale the business and fasten the technology development, Arco Platform has acquired or invested into 11 companies since 2011. Their acquisition strategy is focused on expanding operations into new regions within Brazil and technologies to accelerate the pace of innovation. Now the company has expanded presence in the State of Rio de Janeiro, as well as in the southern region of Brazil. The company also plans to continue to opportunistically pursue further acquisitions to expand their business.

The original article was published by Stockclip, Inc. on 30/12/2018.

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