Cherry Tree Advises Flipgrid in its Sale to Microsoft  

Transaction Description
In June of 2018 Microsoft announced the acquisition of Flipgrid, a rapidly growing provider of an engaging video-based social learning platform used in 180 countries by more than 20 million pre-kindergarten to Ph.D.-level educators, students and families. The Flipgrid platform promotes learner engagement through social media features such as video sharing, while supporting organized educational and learning workflows. Microsoft is a global leader in software and technology, and in serving the needs of educators, students, and corporate users through numerous teaching and learning solutions including Office360 Education.  Cherry Tree & Associates served as exclusive investment banking advisor to Flipgrid in the transaction, and Faegre Baker Daniels served as their legal counsel.

Cherry Tree's Role
Cherry Tree was retained by Flipgrid to advise the Board of Directors on their strategic alternatives, after they had received several inquiries from potential strategic acquirors. It was important to Founders Jim Leslie, Charlie Miller, and Phil Soran that any outcome be in the best interests of all stakeholders, including shareholders, customers, and employees of the company, while protecting their unique position in the market driven by enthusiastic users, and not disrupting their rapid growth. Cherry Tree advised the company through a process that included discussions with numerous potential acquirers and venture capital investors, highlighting the main reasons for Flipgrid's rapid growth and unique position as a learning platform, and subsequently soliciting proposals, negotiating terms, supporting the due diligence process, and facilitating the closing of the transaction.

About the Flipgrid and Microsoft Education Combination
"We're thrilled to see the impact Flipgrid has had in social learning thus far and look forward to helping them continue to thrive as part of the Microsoft family," said Eran Megiddo, corporate vice president for Microsoft. "We're diligently committed to making sure their platform and products continue to work across the Microsoft, Google and partner ecosystems to benefit students and teachers everywhere." Like Office 365 Education software, Microsoft will also be making Flipgrid free for schools so it's easy for any school to utilize the software. Customers who've purchased a subscription from Flipgrid will receive a prorated refund. 

Flipgrid was created in 2015 with a mission of empowering educators as they help students define their voices, share their voices and respect the diverse voices of others. That mission aligns with that of Microsoft, which aims to empower every person and organization on the planet to achieve more.

Microsoft sees Flipgrid as an effective tool to help teachers and students build social emotional skills beyond traditional curricula - skills the company's recent research says will be required in 30 to 40 percent of the fastest-growing occupations.

In joining Microsoft, Flipgrid will retain its distinct brand, culture and team that is focused on amplifying the voices of all students. Expanding Flipgrid's accessibility across the global educator community, the company will also align with Microsoft's General Data Protection Regulation (GDPR)-, Family Educational Rights and Privacy Act (FERPA)- and Children's Online Privacy Protection Act (COPPA)-compliant privacy architecture to ensure Flipgrid continues to be a safe, secure place for students and teachers to communicate.
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About Cherry Tree & Associates
Cherry Tree & Associates, LLC is a private investment banking firm headquartered in Minneapolis, Minnesota, specializing in serving entrepreneurially-managed companies. Founded in 1980, the firm provides financial advisory engagements for buyers, sellers, and companies seeking growth capital, and provides fairness opinions and other valuation services.
Cherry Tree Deal Team

Chad Johnson
Managing Director 
(952) 253-6010

Cherry Tree Contacts

Elmer Baldwin
Senior Executive Director 
(952) 253-6001
John Bergstrom
Managing Director
(651) 227-9758

Chuck Gorman
Senior Executive Director 
(952) 253-6008

Dave Latzke
Managing Director 
(952) 253-6032

Tony Christianson
Managing Partner
(952) 253-6003

Cherry Tree & Associates, LLC,  301 Carlson Parkway, Suite 103,  Minneapolis, MN 55305
Phone: (952) 893-9012 |   www.cherrytree.com



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Important Disclosures
The information included in this publication has been obtained from public sources, and is not based upon private or confidential Cherry Tree information. Cherry Tree gathers its data from sources it considers reliable. However, it does not guarantee the accuracy or completeness of the information provided within this publication. Any opinions presented reflect the current judgment of the authors and are subject to change. Cherry Tree makes no warranties, expressed or implied, regarding the accuracy of this information or any opinions expressed by the authors. Officers, directors, partners of Cherry Tree and Cherry Tree proprietary investment funds may have positions in the securities of the companies discussed, and certain affiliates of Cherry Tree may recommend to specific clients the purchase and sale of securities discussed in the publication.  This publication does not constitute a recommendation with respect to the securities of any company discussed herein, and it should not be construed as such. Cherry Tree or its affiliates may from time to time provide investment banking or related services to these companies. Like all Cherry Tree employees, the authors of this publication receive compensation that is affected by overall firm profitability. We undertake no obligation to update any information in this publication.