M&A activity snapshot
Tutoring and test prep has steady, PE-led deal flow at small sizes. North American test-prep transactions ran 15, 36, 32, 20 and 20 from 2020 through 2024, per L.E.K. and PitchBook data compiled by Navagant. The same report shows private equity made 53% of 2025 transactions. Activity cooled from the 2021 peak but stayed above its 2020 level.
The operator base is small and fragmented. BLS counts 11,451 private establishments and 105,753 employees in NAICS 611691 in 2024, up from 9,730 establishments in 2019. That is roughly 9 employees per site by Axia arithmetic, and the count excludes sole-proprietor tutors.
Franchising shapes the category. Sylvan had more than 700 locations, all but six of its 560+ physical centers franchised, when it sold in 2021. Mathnasium had more than 1,000 locations when Roark Capital bought it. See the Education & Child Services overview for the wider category.
Who is buying
PE-backed franchisors. Roark Capital bought Mathnasium, which had about $225 million in systemwide sales in 2020. Serent Capital backs C2 Education, a K-12 tutoring and test-prep operator with over 100 locations.
Multi-brand youth platforms. Sylvan has changed hands twice. Franchise Group bought it in 2021, then sold it in 2024, when it had 500+ locations across 175 franchisees, to Unleashed Brands, a Seidler Equity Partners portfolio company. Unleashed groups tutoring with youth enrichment brands under one franchise platform.
Test-prep consolidators. Graduate and professional exam prep rolls up by exam. Blueprint (LSAT) sold to New Harbor Capital and acquired Next Step, an MCAT prep provider. Capstone's 2022 report lists Barbri buying PowerScore and Alpine Investors buying FEV Tutor. Kaplan remains the large strategic: its supplemental education segment grew revenue 9% in 2025, to $317,159 thousand.
What buyers look for
Family-paid revenue over district contracts. District-funded tutoring lost its stimulus. ESSER totaled $189.5 billion, and the ESSER III obligation deadline was September 30, 2024. Nerdy's institutional revenue fell 22% to $27.6 million in 2025. Some states still fund tutoring: 23 states provide grant or formula funding.
Durability against AI. Online homework help is losing customers. Chegg reported a 40% decline in paid subscribers in Q2 2025. Tyton says consumer-oriented models face stronger headwinds regarding long-term durability in an AI world. Buyers now prefer in-person instruction, measurable score gains, and parent relationships.
Student retention and pricing. Revenue per student matters more than headcount. Nerdy's active members fell 11% in 2025, while revenue per member rose 21% to $364. For a center, buyers ask about months enrolled per student and the split between subscription-style tutoring and one-time test-prep packages.
What makes a strong company
A tutoring or test-prep business that draws premium interest usually shows:
- Revenue mostly from families on recurring monthly plans, not one district contract.
- Documented outcomes: score gains, grade improvements, or admissions results a buyer can verify.
- Instructors and a center director who stay without the owner teaching.
- A franchise in good standing with transfer rights, or an independent brand with its own curriculum.
- A growing unit base. Franchise systems that shrink get discounted; Entrepreneur lists Huntington Learning Center at 235 units with a -17% growth rate.
- Demand tied to tests that are coming back. The NAEP 2024 results showed reading down 5 points and 8th-grade math down 8 points from 2019.
Valuation and deal structure
Private tutoring multiples are rarely published, so buyers anchor on two references. Public comparables trade at a 1.6x median EV/LTM revenue and 7.4x median EV/LTM EBITDA. The 2021 Sylvan sale disclosed both price and earnings: about $81 million in cash against estimated FY2021 adjusted EBITDA of about $12 million, about 6.75x by Axia arithmetic.
Sector-wide multiples are higher but not tutoring-specific. Capstone reported an average Education & Training EBITDA multiple of 10.9x in 2022, down from 15.2x in 2021. One disclosed tutoring price in that report is Liminex's purchase of TutorMe at a $55.0 million enterprise value.
A single franchised center trades on seller earnings and needs franchisor approval to transfer. Franchisor and multi-unit deals commonly use earnouts or seller rollover into the platform; public sources do not break out how often in this vertical. Owners can test their numbers with the valuation tool.
Outlook
Expect deal flow to favor in-person, family-paid centers through 2027. Overall education deal volume is recovering: Tyton counted 172 U.S. education deals in H1 2026, up 41%. Test demand is firming, with more than 2 million SAT takers in the class of 2025 and Dartmouth, MIT and Georgetown requiring scores again.
The split will widen. Online, low-touch models will keep facing AI questions in diligence, while centers with measurable outcomes and loyal families stay attractive to franchisors and multi-brand platforms.
Own a tutoring or test-prep business? Run the valuation tool, or read how search funds source off-market deals.