Michael Chasen, CEO and co-founder of Blackboard, surprised more than a few people this week by announcing his departure from the company. According to the Washington Post,
Chasen said the decision to depart was reached amicably and that he was ready to pursue new opportunities after 15 years in a high-demand job. Will that next step be part of another start-up or another large firm? Either is an option, he said.
Chasen is only a couple years older than I am and has three kids. It's not unreasonable that he might want to slow things down a bit, particularly after a tumultuous year of acquisitions and increasing competition in the enterprise LMS market. After the company's purchase by Providence Equity Partners for a cool $1.6 billion and change last October, Chasen agreed to stay on as CEO for at least a year. It's been a year and now the CEO of a mutlibillion dollar technology company (Jay Bhatt, CEO of Progress Software and formerly of Autodesk) has been tapped to fill his shoes.
In fact, it's not so much Chasen's departure that sends up a couple of red flags (or, at least, yellow flags). Rather, it's the choice of Bhatt as the next CEO that signals a rapidly shifting market and which should put other ed tech companies on alert. Like Lou Gerstner coming to IBM from RJR Nabisco or Alan Mulally coming to Ford from Boeing, Bhatt, with no formal experience in education but lots of experience in M&A and business strategy, is a change agent. Blackboard, after years of losing market share to a variety of upstarts, is going to grow and diversify in a big way.
The road ahead for Blackboard presents a very different set of challenges than those Michael faced in our early days. Michael’s awareness of this was one of the drivers behind his pursuit of our current structure as a private company with the backing of Providence Equity Partners. Michael and our Board also recognized that Blackboard’s next phase would require a leader with experience, insight and passion to tackle these challenges, and that search has identified a uniquely qualified individual in Jay Bhatt...
It's no secret that the LMS market is shifting quickly with new entrants popping up overnight to cash in on the ed tech boom. Last week, I began a project with a colleague to put together a Moodle site for her online teaching efforts; it took about an hour for us to realize that Google Apps was actually better suited to her needs than Moodle or any other formal LMS. And, as the Gilfus Education Group noted, companies like Adrenna are adapting open source content management systems (in their case, Drupal) to meet the needs of educational institutions.
So what's next for Blackboard? That's hard to say. But I think it's safe to say that the right acquisitions, leadership, and private equity capital have the potential to bring Blackboard back to a position of dominance in ed tech, this time with a suite of services and products instead of merely Blackboard Learn. Despite its continued majority share of the market, Learn is getting a bit long in the tooth and is feeling competitive pressure more than ever. That pressure will do nothing but increase in the months and years to come. I wouldn't be surprised to see Blackboard looking a lot more like Pearson two years from now than just another LMS vendor (albeit a big and succussful one). I'm sure Mr. Henderson will be pulling a few pages from the Pearson playbook, given his years there before he joined Angel and I don't see Mr. Bhatt taking too long to jump into the fray feet first.