- Investment Highlights
- Factsheet
Alef Education was founded to redefine education, where every learner fulfils their unique potential. Its competitive strengths are summarised below:
Alef Education is an award-winning AI-powered and personalised learning solutions and digital education resources provider for governments, primary and secondary schools, educators, students, and their parents in the UAE and other markets.
- The Group provides digital educational resources to all public and many private schools in the UAE. It has a 100% penetration rate among Cycle 2 (Grades 5-8) and Cycle 3 (Grades 9-12) public schools and serves 40-50% of the private school market in the UAE.
- In 2023, the Group’s platforms served approximately 1.1 million registered students, 50,000 educators, and approximately 7,000 schools, capturing approximately 16 million data points per day.
- Alef Education entered the US market in 2018, Indonesia in 2021 and Morocco in 2022. Furthermore, and through a reseller agreement, Alef Education entered the Qatar market in 2023.
- In 2019, Alef Education won the Forbes Ai Everything Brave Award for its innovative use of AI in education. In 2022, Alef Education won two SIIA CODiE Awards for Best Science Instructional Solution for Grades 9-12 and Best Mathematics Instructional Solution for Grades 9-12.
- Alef Education continues to innovate its products in response to market needs. Its products include the Alef Platform, Alef Pathways (Math), Arabits (Arabic for non-native speakers), and Abjadiyat (Arabic for young native speakers).
Alef Education’s in-house research capabilities and proven ability to enhance student performance have cemented its reputation as a trusted partner for governments and educational institutions in the markets where it operates.
- In the 2018-2019 academic year, Alef Education conducted a large-scale, controlled experiment in Abu Dhabi, UAE, analysing final exam results from 357 public schools. The study revealed that students using the Alef Platform demonstrated a 12.1% higher growth in their grades compared to their peers.
- In the Indonesian market, Alef Education has rolled out its services to approximately 650,000 students across approximately 6,016 schools, offering Math and Arabic in the Bahasa Indonesia language.
- In Indonesia, Alef Education’s platform has contributed to an increase in student scores by an average of 8.5% across Arabic and mathematics.
- In Morocco, where Alef Education conducted a six-month pilot program in the 2022-2023 academic year, the Group’s platforms contributed to a significant 13.3% increase in Arabic subject diagnostic test scores, a 22.7% increase in overall final exam test scores for students and a 27% increase in test scores for Grade 9 English students.
Alef Education’s consistently strong financial performance, high margins, and long-term contracts provide stability and predictability, enabling it to pursue growth initiatives and deliver value to shareholders.
- The Group’s revenues reached AED 750 million in the financial year ended 31 December 2023, a 12.4% increase from AED 667 million in 2021, with adjusted EBITDA and adjusted net profit margins standing at 65% and 61%, respectively, in 2023.
- Alef Education’s financial stability is bolstered by a long-term contract with ADEK, which makes provisions for a minimum of 80,000 students and a fixed fee for each student. As of 2024, there are seven years remaining in the contract, and the Group expects to renew it upon expiry. This contract gives the Group revenue visibility and reliability.
- The Group’s business model, which emphasises embedded technology and data-driven insights, results in sticky contracts with sound margins.
- In the B2B market, Alef Education operates on a software-as-a-service model, providing stable recurring revenues.
- The Group has an unleveraged balance sheet, providing it with the flexibility to tap into debt funding for expansion opportunities in new markets, investment in research and development, and acquiring complementary businesses.
With a focus on both organic and inorganic growth strategies, Alef Education aims to expand its market presence, diversify its offerings, and capitalise on global B2G and B2B opportunities, leveraging its scalable multiplatform solution and adaptable curriculum.
- From its home market of the UAE, Alef Education will target markets that share linguistic, cultural, and pedagogical similarities as well as developed markets where EdTech adoption is high.
- To that end, the Group has onboarded an on-the-ground sales team in Saudi Arabia and Egypt, further enhancing its growth prospects within these two large markets.
- The Group is also in discussions with several governments to expand its offering in several other jurisdictions, demonstrating its ability to scale internationally and highlighting its potential to become a global leader in the segment.
- On the B2B front, the Group plans to expand its offerings into more subjects and content areas as well as cater to a broader range of age groups within the private market.
- As part of its inorganic growth strategy, the Group is looking at opportunities to acquire companies with complementing products and capabilities or those that would allow it to cross-sell its services to a broad customer base.
Alef Education operates in markets with significant growth potential for EdTech, supported by increasing government and NGO investment in education, particularly in emerging markets across the MENA region.
- Education represents a substantial portion of the fiscal budget in the UAE and neighbouring GCC countries and is crucial for driving knowledge-based economies. The UAE has historically allocated 15% of its federal budget to education, which amounted to AED 10 billion in 2023.
- In the wider MENA region, the Group estimates that an average of 4% of GDP went towards spending on education in 2022.
- The value of the global K-12 education sector was estimated at AED 14.75 trillion by 2020 and is expected to grow at a CAGR of approximately 5% until 2030. The total addressable market for learning materials is forecast to reach AED 338 billion by 2027.
- The sector is being supported by spending from NGOs. In Egypt, UNICEF has invested $1.2 million for K-12 education and has unlocked additional funding of $16.5 million from the UK and the GPE to advance the implementation of Education 2.0.
The extensive experience of Alef Education’s seasoned management team and the strong shareholder base position the Company to unlock its next phase of growth.
- Alef Education’s management team has extensive industry experience and comprises alums from some of the world’s biggest education companies, including Pearson, McGraw Hill, and Houghton Mifflin Harcourt.
- With a proven track record of delivering results, developing innovative solutions and a clear roadmap for the future, the leadership team is well-equipped to drive success and value creation going forward.
- Alef Education’s key shareholders include Abu Dhabi Capital Group, one of the largest private institutional investment groups in the Middle East and North Africa, with a diversified portfolio spanning multiple asset classes, industries, and geographies.
Since its inception, Alef Education has been committed to building a responsible and sustainable education ecosystem characterised by social inclusion and ethical governance.
- The Company is in the process of developing a comprehensive and robust ESG strategy that makes provisions for tracking and improving emissions, creating equitable and inclusive learning, and embedding high ethical standards across all aspects of the Company’s operations.
- Alef Education signed a memorandum of understanding with the UAE Ministry of Education in October 2023 to establish a framework for increased collaboration in environmental sustainability and climate education.
- Alef Education’s Board consists of seven Emirati Directors, all of whom are Non-Executive directors and pillars of the public and private sectors in the UAE. They are H.E Abdulhamid Mohammed Saeed Alahmadi (Chairman), H.E Ahmed Ali Al Sayegh (Vice-Chairman), H.E Noura bint Mohammed Al Kaabi, H.E Jameela Al Muhairi, Omar Abdulla Al Hashmi, Rima Al Mokarrab, and Dr. Saeed Alghfeli.