Accenture’s upskilling push with Udacity deal
The IT major seeks to bridge online education and workplace relevance
Aday after launching upskilling platform LearnVantage, Accenture Plc. announced its plans to acquire Californiabased edtech platform Udacity as part of an initiative to boost upskilling opportunities for its clients.
The information technology (IT) major plans to invest $1 billion over three years to onboard clients requiring training as well as upskilling in technology, data and artificial intelligence (AI).
The decision is driven by the growing demand for upskilling, especially in generative AI, in the global IT services industry. This trend could present significant business opportunities for leading software outsourcing firms.
According to the agreement, Udacity’s team of more than 230 professionals will join Accenture, the company said in a statement on Wednesday.
“The acquisition will bring to Accenture Udacity’s capabilities in integrating proprietary content, expert services, and scalable learning technology, while bridging the gap between online education and workplace relevance,” Accenture added.
Established in 2011 by Sebastian Thrun, Udacity offers job-ready certified skill sets and training programmes focusing on AI and machine learning.
The firm attained unicorn status in 2015 after securing a $105-million Series D funding. Its clients include industry leaders like Google, Microsoft, IBM, and AT&T.
Previously, Udacity was in negotiations with Hindi film producer Ronnie Screwvala-backed edtech startup UpGrad to sell a majority stake at a $100 million valuation. This development reflected a significant value erosion within the edtech startup ecosystem, following the downturn at Byju’s, the world’s leading edtech company.
The drop in Udacity's valuation was a direct consequence of the edtech industry’s decline. “How the Byju’s crash affects the overall edtech industry depends on the stage each company is at, and the areas
the edtech caters to. Edtech in India and China are not looking good these days. China had their policy changes, and India has had its own challenges,” said Jeff Maggioncalda, chief executive of Coursera, in an interview on 14 January.
"Since the covid-19 pandemic, edtech financing went from as much money as one could have asked for at an incredibly high valuation, to much higher conservatism. No investor will presently invest in local content firms—the language is no longer a differentiator, nor is the content domain expertise. New startups have no distribution, making this one of the worst segments to be in—especially in edtech parlance," Maggioncalda said.
Stamford-headquartered IT advisory firm, Information Services Group, Inc (ISG), said that Indian IT services firms are also prioritising reskilling their workforce, including in Gen AI technologies. “On an average, the top Indian IT service providers are reskilling 25K-50K employees. Training staff to leverage AI, along with industry and business process-specific use cases is a key focus area for the providers,” Mrinal Rai, assistant director and principal analyst at ISG, said in an emailed response.