Microsoft acquires DataSense management from BrightBytes to step up its education play in Azure

One of Microsoft’s oldest and biggest verticals for its Azure cloud business has been education, and today it announced an acquisition that it hopes will help it deepen its reach: it has acquired DataSense — a data management platform that can be used to collect, integrate and report information from across a range of online education applications and services — from an educational technology company called BrightBytes, to integrate the functionality into Azure.

DataSense is a master platform that’s used by schools and educational authorities both to ingest information as well as report it to state and other authorities, covering disparate applications and other data sources. Even before being acquired by Microsoft, it already had a lot of reach, currently being used to manage data for millions of students in the U.S., BrightBytes  says. The Microsoft acquisition should supercharge its growth.

It looks like the deal actually closed in December, according to data from PitchBook, although it’s only being announced today.

Terms of the acquisition are not being disclosed, but as a point of reference, BrightBytes was valued at $120 million when it last raised money, in 2015 — a $33 million round led by Insight Venture Partners, with participation from Bessemer, Learn Capital and Rethink Education.

The startup had raised just over $50 million in total, with other investors including New Schools Venture Fund and Andy Pechacke. It looks like BrightBytes will continue to operate, focusing on its Clarity data analytics platform, which itself is used by 25,000 schools in the U.S.

“We are excited about the global acceleration this sale provides to our mission,” said BrightBytes CEO, Traci Burgess, in a statement. “Schools around the world will benefit greatly from capabilities across data integration, interoperability, and provisioning.”

The deal will include people at San Francisco-based BrightBytes who had been working on the DataSense product, both to continue supporting existing customers as well as to develop the future product.

A Microsoft person did not specify how many exactly would come over, describing it as a “remote team primarily located in the Atlanta, Georgia area. The small team will be joining Microsoft’s Education team.”

Microsoft will be integrating DataSense into its Azure platform to expand how Microsoft serves schools and educators on its platform while continuing to keep a link between it and Clarity.

“In the coming months, we’re excited to begin the process of integrating DataSense technology into our products for schools, providing a single, more secure, Microsoft-based service that will unlock the power of data analytics for schools,” said GM of Education Strategy and Platforms at Microsoft, Steve Liffick, in a statement. It will also continue to serve existing customers of the product.

BrightBytes and Microsoft have a common goal in sight. Both have identified that education has become a very big data business, but one with a huge amount of legacy infrastructure and fragmentation.

As education authorities have started to update their systems to work with government and other organizations better — and also to try to better organize the data they already have in their systems — companies like Microsoft and BrightBytes have stepped in to provide assistance.

On the part of Microsoft, the company is working at a number of levels here — providing hardware, addressing different stakeholders from teachers and students through to IT administrators, and through software, cloud services, training and more. This deal specifically is aimed at the IT admins who help the wheels turn, although it will ultimately touch data affecting many others.