Is OpenLearning [ASX:OLL] a net winner from the pandemic?

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One of the few industry sectors that should benefit from the current COVID-19 crisis is the education sector, as long as providers have the magic word “online” in their kit bag. As an example, Open Learning Limited [ASX:OLL] is an Australian online learning platform which recently signed a commercial deal that will expose its platform to the Kindergarten to Year 12 niche in several countries. It also now has access to the servers of Chinese giant Alibaba. More on that later.

"Everyone [in education] knows that things would eventually move online but the current situation has accelerated things," according to OpenLearning's CEO Adam Brimo.

He believes that the CORVID-19 crisis has forced major universities to rapidly try and figure out how to protect themselves using the old investing philosophy of diversification.

That is striking the right balance between on-campus education and the rapidly growing demand for online.

This, according to Brimo, puts OpenLearning in a very good position as he says OpenLearning offers the ability to create courses using a recognised educational strategy known as Social constructivism.

As the name suggests, social constructivism is a highly interactive approach that Brimo says is evidenced-based, unique to OpenLearning, and therefor a drawcard for Tier One universities.

OpenLearning currently says it has more than 1.74 million learners worldwide across over 7,900 courses provided by 62 education providers.

At the end of last December, the company had $7.7 million dollars in the bank and a quarterly cash burn of about a million dollars up to the last quarter of 2019, although Brimo believes this will start to fall soon. One of the reasons he expects a reduced is a recent deal exposing the OLL platform to the primary and senior school sector for the first time.

This has been achieved through a partnership with a not-for-profit group called High Resolves. which has K-12 students and schools in Australia, the United States, Canada, Mexico and Brazil.

The company also recently announced access to the Chinese market after Alibaba agreed to include the education SaaS on the Chinese powerhouse’s local servers.

According to Brimo, this is an advantage for several interesting reasons, as he explains in our interview.

DISCLAIMER AND IMPORTANT INFORMATION

I do not own shares in OpenLearning Limited at the time of writing this post. Nor do I accept any payment from this or any other companies I cover. Nor is my interview or blog in any way a recommendation and should not be seen as a form of financial advice. Disruptive technology stocks should be considered very speculative, high-risk, and extremely volatile. There are significant risks inherent in developing new technologies that are not discussed here. You should always seek professional advice before considering any share purchase or sale. Please read our full disclaimer.