Target Information

Right at School (RAS), a leading provider of innovative before and after school programs, has been a significant player in the education sector. The company offers a range of enriching programs and school break camps, serving school districts nationwide. Under the leadership of Founding CEO Mark Rothschild, RAS has distinguished itself in the marketplace through its commitment to quality education and comprehensive services.

Recently, Prairie Capital, a Chicago-based private equity firm, completed the successful sale of a majority stake in RAS to a larger private equity fund. Despite the transition, Prairie Capital and RAS’s management team will continue to hold minority ownership, ensuring ongoing involvement in the company's direction and strategy.

Industry Overview

The before and after school program industry in the United States is a dynamic and rapidly expanding sector, largely due to increasing demand for child care solutions that cater to working parents. As families seek flexible educational options, the market has become attractive to investors, leading to substantial growth opportunities for established companies like RAS.

The industry remains fragmented, with numerous local and regional players offering a variety of services. This fragmentation provides a fertile ground for consolidation, where leading providers can scale operations, enhance service offerings, and achieve greater market share through strategic investments.

Furthermore, as more school districts recognize the importance of supplemental educational programs, the demand for high-quality, reliable providers has surged. This underscores RAS’s positioning as a market leader, ready to capitalize on future growth through expanded offerings combined with innovative approaches to education.

The current landscape also presents challenges, including competition and the need for constant innovation in program delivery. However, companies that can differentiate themselves through quality and customer focus are poised for sustained growth.

Rationale Behind the Deal

The rationale behind Prairie Capital's investment in Right at School centered on the transition from a founder-led to a scalable company. This approach involved substantial investment in various areas, including marketing, technology, and human resources. By doing so, Prairie Capital aimed to position RAS as a leading platform within a burgeoning industry.

During Prairie’s tenure, RAS experienced significant growth, with annual revenues increasing more than eight-fold. The strategic investments made were pivotal in enhancing the company’s capabilities and service delivery, thereby increasing its value proposition and market reach.

Investor Information

Prairie Capital is a well-established middle-market private equity firm based in Chicago, recognized for its commitment to partnering with management teams and founders. The firm specializes in identifying high-growth opportunities across various industries. Prairie’s hands-on approach and strategic foresight have enabled it to drive substantial growth within its portfolio companies.

The firm’s focus on the education sector exemplifies its intent to support scalable businesses that align with evolving market demands. By investing in companies that demonstrate strong management and growth potential, Prairie Capital has solidified its reputation as a leading private equity investor.

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From a deal analysis perspective, the sale of Right at School represents a strong investment outcome for Prairie Capital. The firm not only navigated RAS through substantial growth and market expansion but also positioned the company favorably for future investments.

This transaction underscores the potential for high returns in the educational services sector, particularly as demand continues to increase for after school programs and child care solutions. Moreover, retaining minority stakes allows Prairie Capital to stay involved and benefit from future growth, reflecting a strategic exit strategy that encourages long-term participation in RAS's success.

The ability to achieve an 8x revenue increase during the holding period demonstrates the effectiveness of Prairie's investment strategy and operational improvements. This aligns with broader industry trends favoring consolidation and robust service offerings in a fragmented market.

In conclusion, the strategic decisions made by Prairie Capital in partnership with RAS have not only yielded significant financial returns but have also established a strong foundation for ongoing growth in a vital segment of the education industry.

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