ABCmouse Is Teaching Kids and Upending Classrooms. Can Education Research Keep Up?

Sarah Favot

Favot is an award-winning journalist and adjunct instructor at USC's Annenberg School for Communication and Journalism. She previously was an investigative and data reporter at national education news site The 74 and local news site LA School Report. She's also worked at the Los Angeles Daily News. She was a Livingston Award finalist in 2011 and holds a Master's degree in journalism from Boston University and BA from the University of Windsor in Ontario, Canada.

ABCmouse Is Teaching Kids and Upending Classrooms. Can Education Research Keep Up?

The pandemic has prompted the adoption of educational technology, contributing to a red-hot edtech market and reshaping how children are learning.

Last year alone, investors sunk $2.2 billion into edtech companies, according to EdSurge. And data from PitchBook show the first half of this year has already surpassed that, reaching $3.6 billion


ABCmouse, one of the most popular children's learning apps, watched in June as its Glendale-based parent company pulled off the largest financing round ever for an edtech company: $300 million.

Alongside it, a raft of children's educational apps — from Khan Academy Kids to Newsela — promise to improve children's academic skills. Duolingo, a popular language learning app, went public in July. On its first day of trading, shares closed up 36%, valuing the company at nearly $5 billion. But there remain questions about whether all the screen time is effective and educational.

Tony Wan, head of investor content at San Francisco-based venture capital firm Reach Capital, said many investors who have been trepidatious of investments in edtech in the past have witnessed the explosion in the adoption of edtech tools at home and in classrooms, attracting larger private equity firms and more prominent venture capitalists.

"I think the experience [during the pandemic] has really opened up their eyes, followed by their wallets, in terms of the potential that education technology has and how broadly some of these services span across geographies and across age ranges," Wan said.

Educational Experience or Sanctioned Screen Time?

Age of Learning, the 14-year-old company represented by an iconic little grey mouse, was valued at $3 billion after it clinched a financing round backed by TPG, along with Qatar Investment Authority and Madrone Capital Partners. It's one of the largest U.S. edtech companies of its kind.

The company was founded in 2007 by Doug Dohring, who created and sold NeoPets in 2005, a company that allowed users to own virtual pets and buy virtual items for them using virtual money.

Dohring, who declined to talk, has said he wanted to create educational software to address the millions of students who are below grade level standards in reading and math, not one trying to sell products to kids. (NeoPets was criticized for the prevalence of ads on its website).

ABCmouse promises to get anxious parents' kindergarteners reading and their older children up to speed just by "playing" educational games.

And while Age of Learning has funded several studies to evaluate whether their products work, many academics say third-party research is needed to determine the effectiveness of such edtech apps, although effectiveness is difficult to measure.

"It's hard to say if it's truly, truly helping improve student learning, but I do think if it's helping students engage and practice skills and getting them excited to want to learn, then to me, that's successful," said Tim Green, a professor of educational technology at California State University Fullerton.

But there is not a great amount of specific research on these tools, especially studies that have been replicated, Green said. One classroom with a specific teacher and a specific group of kids does not represent all classrooms.

"If I'm having students spend an hour to two hours using ABCmouse, I want to be able to see some gains specifically," Green said. "I think it's difficult to do with a lot of software because those kinds of studies are not the easiest to set up, so I'm not sure that's always possible."

In the absence of research, educators must evaluate whether children are actively engaged in the content or view it as just a game.

"We have to look at what are they doing on the device," said Sophia Mendoza, director of the L.A. Unified School District's Instructional Technology Initiative. She added that the implementation of these programs in classrooms must be "strategic and purposeful."

Teachers who leaned on technology during the pandemic have grown accustomed to it. And with the edtech market continuing to boom, academics said it's also important for investors to be concerned about whether the companies they back are educational.

"If you're saying you're going to improve a students' ability to do math skills. It is important to see that there's some evidence with that — and that can be difficult to measure," Green said. "Should investors be concerned about that? Of course."

But Doug Lynch, a faculty member at USC's Rossier School of Education, isn't convinced it's possible for investors to do true due diligence when it comes to edtech.

"Now everybody is, for better or worse, interested in edtech, so there's a lot of money coming in," he said. "They're very smart investors, but they don't know a lot about the market and what the science tells us about learning."

Compounding the problem is the lack of a regulatory body overseeing edtech, giving it less scrutiny than other industries.

"We don't follow the same rigor that we do in education the way we do in healthcare, for example," he said.

A good gauge could be whether school districts purchase the software, but some startup companies do not make it, Lynch said.

COVID Was the Catalyst

Age of Learning has "made it" by many measures.

Its programs have been accessed by 50 million children globally and have been used in hundreds of thousands of classrooms, according to the company.

"It never loses track of your child's progress. All you have to do is play," the company says in a promotional video touting the $12.99 monthly subscription service.

Children can navigate through the app's yellow classroom into more than 850 lessons that can take the shape of a zoo or a farm and include 10,000 activities that range from reading and math to puzzles, games and painting.

The digital lessons seem like a total win for overextended parents, many who struggle to steer their child away from idle screen time in a world where everything is done online.

"Our work is to build quality, engaging, effective digital learning programs that help kids develop a love of learning and in doing so, build core skills that help them in school and beyond," said Zachary Katz, an executive at the Age of Learning who leads legal, corporate and business affairs.

With products aimed at kids 2 to 8 years old, Katz said kids typically spend 45 minutes on the app per week.

"You're not talking about a very heavy load of screen time," he said.

The company's latest infusion of capital will help it expand internationally and invest in a patented system to determine a child's skill level.

It comes as the company must also repay customers $10 million over illegal marketing and billing practices, after regulators found last year the Age of Learning automatically renewed tens of thousands of customer subscriptions, charging them without their consent. The Federal Trade Commission also found the edtech company made it difficult for customers to cancel memberships, earning the company even more fines.

Even as children are returning to classrooms, Katz said Age of Learning expects to keep growing. It's subscriber base remains at pre-COVID-19 levels.

"The gains that we've seen in children using our products have sustained even as kids have gone back to school," Katz said.

After so many years of investors often ignoring the industry, the attention is welcome to companies like Age of Learning.

"We know a fair amount about what could work," Lynch said. "We don't have all the necessary components of an ecosystem yet, maybe COVID will be the catalyst that we needed."

The $260M Robot Revolution Happening in Torrance

🔦 Spotlight

Hello Los Angeles,

Forget rockets. This week, the loudest move in the defense tech scene came from a factory floor in Torrance, where Hadrian secured $260 million to fuel its robot-run revolution.

The company, which builds AI-powered, robot-run factories for America’s aerospace and defense industries, announced the massive Series C raise, led by existing investors like Lux Capital and Founders Fund, along with a factory expansion loan facility arranged by Morgan Stanley. The funding will power Hadrian’s third factory (in Arizona), unlock full product manufacturing, and accelerate its mission to bring American manufacturing roaring back faster, smarter, and more automated than ever.

And here’s what makes them fascinating: Hadrian isn’t just churning out parts. They’re reinventing what a factory is. Their facilities look more like giant humming circuit boards than the smokestacks of old, packed with robots, AI, and ambition to move at the speed of software.

It’s the kind of vision you’d expect from a founder who speaks about reshoring U.S. manufacturing as if it were a moral obligation and then backs it up with billion-dollar contracts and steel-and-silicon proof.

We’ll be watching closely to see what Hadrian assembles next. One thing’s certain: the robots are already working overtime, and if you’re smart (or a robot whisperer), you might want to join them.

🤝 Venture Deals

LA Companies

  • Boulevard, a SaaS startup that helps salons and self-care businesses manage scheduling and operations, has raised an $80M Series D led by JMI Equity at a valuation near $800M. The funding will fuel enhancements to its AI-powered scheduling tools and support continued product innovation and market expansion. - learn more
  • Rwazi has raised $12M in Series A funding to expand its AI-powered decision-making platform, which helps businesses replace gut-based decisions with real-time insights and simulations based on consumer behavior. The round was led by Bonfire Ventures and will support the growth of Rwazi’s simulation engine and data infrastructure to help companies make more precise, data-driven decisions across marketing, product, and operations. - learn more
  • Lexington Bakes, an artisan bakery known for its gluten-free, organic oat bars and luxury brownies, has raised $1M in a seed round. The investment was led by Rainfall Ventures. The funding will help the company transition to co-manufacturing, expand its retail reach from about 100 to a projected 1,000 doors in the next year, and scale up its team and operations. - learn more

LA Venture Funds

  • TCG (The Chernin Group) participated in Substack’s latest $100M funding round, joining Andreessen Horowitz, and other investors. Their investment underscores confidence in Substack’s vision to grow its subscription publishing platform and expand its tools for independent writers and creators. - learn more
  • Acre Venture Partners participated in Zucca’s $5M funding round to help the Seattle startup scale its platform, which uses AI to design and develop plant-based food products faster and more efficiently. Their investment will support Zucca’s mission to create sustainable, health-focused foods and expand its operations. - learn more
  • Sound Ventures joined XMTP’s $80M Series B to back its vision of redefining how people communicate in the web3 world. With this funding, XMTP plans to scale its decentralized, privacy-focused messaging protocol, enabling secure, wallet-to-wallet conversations across the blockchain ecosystem. - learn more
  • Morpheus Ventures and Sage Venture Partners participated in Datavations’ $17M Series A funding round, with Morpheus joining as a new investor and Sage returning as an existing backer. Datavations, an AI-driven analytics platform for the building materials and home improvement industries, uses machine learning to deliver actionable insights on pricing, inventory, assortment, and supply chains. The funds will be used to grow the team, accelerate development of its Commerce Alert Hub, and expand its presence across North America. - learn more
  • Mucker Capital led the $3.3M seed round for Bidbus, an AI-powered consumer-to-dealer used car marketplace in the U.S. The platform enables car owners to auction their vehicles online and receive competing offers from dealers, while dealers gain access to high-quality inventory more efficiently. The funding will help Bidbus enhance its AI capabilities and expand into new markets. - learn more
  • Creative Artists Agency (CAA) participated as a strategic investor in Moonvalley’s $84M funding round, signaling strong industry confidence in the company’s development of a fully licensed, AI-powered video generation platform tailored for professional filmmakers and studios. CAA’s investment reinforces Moonvalley’s commitment to ethical AI practices and provides it with a direct pipeline to top-tier creative talent and entertainment partners. - learn more
  • MANTIS Venture Capital joined Zip Security’s $13.5M Series A funding round, backing the company's mission to deliver automated, AI-driven cybersecurity and compliance solutions. Their participation supports Zip’s efforts to expand its engineering team, build deeper platform integrations, and scale into regulated industry verticals like defense, finance, and healthcare. - learn more
  • Rebel Fund participated in Apolink’s oversubscribed $4.3M seed round, joining other notable backers such as Y Combinator and 468 Capital. By investing in this 19‑year‑old–led space tech startup, Rebel Fund is supporting Apolink’s mission to deliver continuous LEO satellite connectivity and facilitate its planned demo missions and constellation build‑out. - learn more

    LA Exits
    • Retina AI is to be acquired by Onar in a deal that will enhance Onar’s AI-powered customer analytics and personalization offerings. By integrating Retina’s predictive customer lifetime value technology, Onar aims to provide businesses with deeper insights into customer behavior and more precise targeting. The acquisition highlights Onar’s commitment to delivering data-driven solutions for optimizing customer relationships. - learn more
    • Nearsure, a U.S.-based tech services company with over 600 professionals across 18 Latin American countries, has been acquired by Nortal to bolster its AI and enterprise solutions in the Americas. Known for its AI-driven transformation, custom software, and partnerships with major platforms, Nearsure will merge into Nortal’s U.S. operations and rebrand later this year. The acquisition allows Nearsure to expand into U.S. and European markets while enhancing its AI, cybersecurity, and enterprise offerings. - learn more
    • InsideOut Sports & Entertainment, the event production company behind high‑profile sports events like The Pickleball Slam, Pro Padel League, and Major League Pickleball, has been acquired by GSE Worldwide, marking GSE’s first foray into live event production. Founded by tennis legend Jim Courier and Jon Venison, who will now serve as EVP and head of the new GSE Productions division, InsideOut’s team will integrate into GSE to help scale its live-event operations into new markets. - learn more

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      From Sunset Boulevard to Outer Space: LA’s Latest

      🔦 Spotlight

      Good Morning Beliebers and Los Angeles!

      While Justin Bieber’s new album dropped last night, here’s what else is making headlines in Los Angeles this week.

      Luma has opened its Dream Lab on Sunset Boulevard, boldly positioning itself at the forefront of AI-powered creativity. Known for transforming ordinary photos into cinematic 3D scenes, Luma is combining cutting-edge research with practical tools to build a playground for artists, engineers, and anyone ready to push the boundaries of visual storytelling. In their words: “From Hollywood blockbusters to the next generation of immersive media, this is where the magic happens.”

      Meanwhile, well beyond our skyline, SpaceX reportedly hit an eye-popping $400 billion valuation in a recent share sale, making it one of the most valuable private companies ever. The milestone reflects both investors’ fervor for the commercial space race and LA’s unrivaled role as the launchpad of aerospace innovation.

      LA continues to prove it can deliver on the ground, in the cloud, and far beyond the stars. See you next week.

      🤝 Venture Deals

      LA Companies

         
      • Varda Space Industries, the El Segundo–based company manufacturing pharmaceuticals in microgravity, has raised $187M in a Series C round led by Natural Capital and Shrug Capital, bringing its total funding to approximately $329M. The funds will support an increased launch cadence of robotic drug-production capsules, expansion of its El Segundo lab for biologic drug crystallization, and broader efforts to scale commercial microgravity-driven drug formulation and hypersonic reentry testing. - learn more

      LA Venture Funds

      • Rebel Fund participated in Vellum’s $20M Series A round, which was led by Leaders Fund. The company helps businesses build and optimize LLM-powered applications. Vellum plans to grow its team and speed up product development with the new funding. - learn more
      • Bold Capital participated in a $31M Series B funding round for Aqtual, a Hayward, California based precision medicine startup developing a cutting edge cell free DNA (cfDNA) multiomics platform. The capital will help commercialize Aqtual’s flagship rheumatoid arthritis diagnostic, currently being tested in a 1,300 patient trial, and support expansion into other chronic and autoimmune diseases. - learn more
      • Strong Ventures invested in VERAMORE, a skincare brand focused on addressing early signs of aging in women. Since launching in March 2022, VERAMORE has grown over 300% annually, expanded to more than 16 products, and entered markets including Japan, Singapore, Vietnam, Taiwan, Europe, and Korea. The funding will support its D2C growth, product-driven marketing, and planned global expansion starting with Japan in 2025 and the U.S. and Europe in 2026. - learn more
      • Mucker Capital joined a $3.7M seed funding round for Velvet Capital aimed at launching its DeFAI operating system and $VELVET governance token. Velvet’s vertically integrated DeFi toolkit combines AI-powered trading, portfolio management, APIs, and a native token to streamline on-chain investment for funds, DAOs, and individual traders. The funding will accelerate platform development, the rollout of its tokenomics, and broader adoption of its intent-based DeFi suite. - learn more
      • Btech Consortium Fund participated in a $8.5M Series A funding round for Castellum.AI, a New York based financial crime compliance platform that uses in‑house risk data, AI, and screening tools to help financial institutions manage AML/KYC compliance. The funds will be used to expand their team, enhance integrations with financial institutions, and accelerate adoption of their AI‑powered compliance solutions. - learn more
      • Bold Capital Partners joined the oversubscribed $45M Series A round for Centivax, a South San Francisco biotech company dedicated to developing a universal flu vaccine using a proprietary mRNA-based immune-engineering platform. Led by Future Ventures, the funding will help Centivax advance its lead candidate into Phase I clinical trials and expand its broader universal immunity pipeline targeting pathogens like RSV, HIV, and malaria. - learn more
      • Alpha Edison participated in Honor Education’s $38M Series A funding round for the San Francisco–based learning platform. Honor uses AI‑enhanced, mobile-first courses and credentialed programs to improve engagement and leadership development. The funding will be used to scale AI capabilities, personalize learning experiences, and expand the company’s operations and customer‑success teams to meet rising demand. - learn more
      • Wasserman Ventures participated in a $7M seed round for Fantasy Life, the fantasy sports platform founded by Matthew Berry. The funding will support the launch of Fantasy Life’s revamped platform, featuring new “Guillotine Leagues,” a modernized app experience, and enhanced content and tools to scale its audience and technology offerings. - learn more

      LA Exits
      • El Segundo based Kaye Capital Management, a fee only RIA with approximately $700M in assets under management and $300M in assets under advisement, was acquired by Modern Wealth Management, marking its 17th acquisition and pushing its total AUM over $8.5B. The deal strengthens Modern Wealth’s presence in California and adds Kaye’s institutional retirement plan expertise to its suite of financial and retirement solutions for clients. - learn more
      • NIRx Medical Technologies was acquired by Gilde Healthcare’s private equity fund and combined with Artinis Medical Systems to form a world-leading neuroimaging group. Both companies will retain their brands and locations while collaborating on R&D, product development, and global expansion of their functional near-infrared spectroscopy (fNIRS) tools to advance research in mental health, neurodegenerative diseases, and stroke rehabilitation. - learn more
      • Emotive, a conversational SMS marketing platform, has been acquired by Privy to create a unified solution for e-commerce brands that combines email, SMS, pop-ups, and real-time customer conversations. The integrated platform will help over 10,000 merchants simplify their marketing, personalize customer interactions, and strengthen relationships with dedicated strategists and transparent pricing. - learn more

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      Tinder, Starlink, and Apple’s New Studio: This Week in LA

      🔦 Spotlight

      Happy Independence Day, Los Angeles! 🇺🇸

      While you're celebrating freedom, here are some electrifying updates lighting up LA’s tech, satellite, and music scenes:

      🔥 Tinder mandates Face Recognition in California

        Image Source: Tinder

      Tinder is now requiring all new users in California to complete a biometric face check, a brief video selfie processed via FaceTec, to verify profiles are genuine. The video is deleted post-verification, though an encrypted face map remains while the account is active. This West Hollywood based move could redefine trust, safety, and privacy in mainstream consumer apps.

      🌐 Starlink clears hurdle to launch in India

      Elon Musk’s SpaceX backed Starlink has cleared most regulatory and licensing hurdles with India’s Department of Telecommunications, marking a key step toward launching satellite broadband in one of the world’s fastest growing markets. Final approvals from the national space regulator are pending, and services, expected to deliver high speed connectivity to underserved regions, could launch in the coming months. This is a major milestone for Starlink’s global expansion.

      🎧 Apple Music opens Culver City creative hub

        Image Source: Apple

      Apple Music is celebrating its anniversary by launching a brand new 15,000 square foot, three story studio in Culver City. The facility, featuring a 4,000 square foot soundstage, spatial audio suites, podcast booths, and more, is designed by Eric Owen Moss and slated to open mid August. It solidifies LA’s reputation as a creative powerhouse and reaffirms Apple’s commitment to investing in and nurturing our city's cultural ecosystem.

      From dating apps to deep space to sound stages, LA isn’t just watching the future unfold, we’re building it.

      Here’s to independence, imagination, and everything this city dares to launch next. Happy Fourth, Los Angeles.

      🤝 Venture Deals

      LA Companies

      • Castelion has raised a $350M Series B round led by Lightspeed Venture Partners alongside Altimeter Capital to scale its hypersonic missile production capabilities. The El Segundo-based defense startup plans to use the funds to expand manufacturing, accelerate testing through its SpaceX-inspired rapid development model, and position itself as a cost-effective supplier of hypersonic weapons to the U.S. military and its allies. - learn more
      • Earth Sama, a Calabasas, California–based climate-tech platform that helps rural farming and Indigenous communities generate and manage carbon credits, secured investment from Omtse Ventures. The funding will support the rollout of Earth Sama’s blockchain-powered field app, climate-creator platform, and smart-contract tools to scale community-led carbon credit projects globally under the Paris Agreement’s Article 6.4 framework. - learn more

                LA Venture Funds

                • Plassa Capital participated in Metafide’s $3.275M funding round. Miami based Metafide, the creator of SURGE, a gamified trading platform that combines AI neural networks and human insight, will use the funds to scale and launch SURGE into the market. - learn more
                • BOLD Capital Partners participated as a founding investor in Syntis Bio’s $33M Series A round, with an additional $5M in NIH grants. The Boston-based biotech is developing oral therapies for obesity and rare diseases, and the funding will help advance its SYNT platform, moving its lead obesity treatment, SYNT-101, into Phase 1 trials and supporting development of SYNT-202 for homocystinuria. - learn more
                • BAM Ventures participated in Cred’s $15M seed round for its predictive intelligence startup. San Francisco based Cred uses AI to unify company data with real time market signals and deliver actionable insights for sales and operations. The funding, led by defy.vc, will be used to scale Cred’s platform, expand its customer base, and grow team and product capabilities. - learn more
                • BOLD Capital Partners participated in Gallant’s $18M Series B round to advance its ready-to-use stem cell therapies for pets. The funding, led by Digitalis Ventures with additional support from NovaQuest Capital, will help Gallant bring its off-the-shelf regenerative treatments to market. - learn more
                • Rebel Fund joined the seed round for Rocketable, contributing to the $6.5M raised to build a portfolio of fully automated SaaS companies. San Francisco-based Rocketable, backed by True Ventures and others, uses AI agents to operate acquired software products, and Rebel’s support will help scale both the platform and acquisitions. - learn more 
                        LA Exits
                        • Leasepath, a cloud-first provider of equipment lease and loan management software, has been acquired by Solifi to enhance its mid-market offerings. The deal allows Solifi to expand Leasepath’s Microsoft Dynamics-based platform into new global markets while keeping Leasepath’s team and leadership in place. - learn more

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