Bloomberg News
Harcourt, AOL, Others Invest $51 Mln in FamilyEducation Network
Boston, April 26 (Bloomberg) -- Harcourt General Inc., America Online Inc., and three other companies are investing $51 million in closely held FamilyEducation Network, which creates World Wide Web sites for schools.
Harcourt is investing $17 million, said FamilyEducation Chief Executive Jonathan Carson. The other investors are Jostens Inc., a maker of graduation rings and yearbooks; Sprout Group, a venture capital affiliate of Donaldson, Lufkin & Jenrette Inc.; and Morningside Group, an investment group. Carson declined to specify the size of their investments.
The money will allow Boston-based FamilyEducation Network to expand its services to more school districts, and gives it access to educational publisher Harcourt's sales force and content, such as tests and textbooks, Carson said. FamilyEducation offers free Web sites to school districts across the country that include information ranging from notes on student council meetings to schedules for sports teams. ''It's really big because this is effectively an IPO-size financing,'' said Carson. ''It allows us to continue to invest in the infrastructure and to accelerate'' the company's expansion.
It marks the second time FamilyEducation has gained an investment from America Online, the world's top online service. AOL said in April 1998 that it would invest $14 million in the company for a 20 percent stake.
FamilyEducation Network said its mission is to link school districts with students and their families. The service, free to schools, parents and children, brings in revenue through sponsorships, advertising and electronic commerce. More than 700 school districts have signed with it.
Some Internet companies are going public too early, he said, gaining pressure to show quarterly results rather than getting time to build a strong business. ''The intent was to do an IPO- size financing and stay private,'' said Carson.
The Internet has been criticized for its part in the Littleton, Colorado, tragedy, when two young gunmen opened fire on students and teachers. That's because information such as how to build a bomb is easily found on the global computer network. ''Given this Colorado travesty, which is where the Internet has been criticized, it's an opportunity for us to show the power the Internet'' in a positive light, said Harcourt Inc. President James Levy in an interview.
Harcourt Inc. is a subsidiary of Chestnut Hill, Massachusetts-based Harcourt General that focuses on educational products and services. Harcourt also owns upscale retailer Neiman Marcus.
quote.bloomberg.com |
