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McGraw Hill Buys Teachally, a Five-Person AI Startup, to Build and Translate School Curriculum Faster

The Editor

The Editor

— 4 min read
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Teachally CEO Daniel Bernstein
Teachally CEO Daniel Bernstein

McGraw Hill announced on September 2, 2026 that it has acquired Teachally, a startup whose artificial intelligence platform lets teachers create, adapt, localize and translate standards-aligned instructional materials. Financial terms were not disclosed. The publisher, which trades on the New York Stock Exchange under the ticker MH, said the technology will shorten its development cycles for K-12 curriculum, the US term covering kindergarten through twelfth grade, improve speed to market and make it easier to customize products for different state standards and international markets. Jana Thompson, interim president of McGraw Hill's School Group, is overseeing the integration.

Teachally was co-founded by Daniel Bernstein, chief executive, and Rushil Makkar, chief technology officer. The company started as EZ Reward, maker of a children's app called EZ Stickerbook, and pivoted to AI curriculum tools roughly three years ago. It had five employees spread across three continents, Bernstein and a colleague in Seattle, Makkar in Melbourne, a customer success lead in Arizona and a developer in Ethiopia, and had raised only a small seed round from local angel investors about nine months before the sale. All five are joining McGraw Hill, with Bernstein taking a senior advisor role. Bernstein previously founded the casual games studio Sandlot Games in 2002, sold it to Digital Chocolate in 2011, and spent about a decade as a technology mergers and acquisitions advisor at Corum Group and at his own firm, Hemisphere Partners.

Market Context

McGraw Hill needs the K-12 side of its business to work. In its fiscal second quarter of 2026, the company reported revenue of US$669.2 million, down 2.8% year over year, with higher education up 14.0% to US$213.0 million and K-12 down 11.2% to US$359.1 million. Digital revenue rose 7.6% to US$352.2 million and recurring revenue reached 63% of the total, which is the transition investors are paying for. The company guided to full-year revenue of US$2.031 billion to US$2.061 billion and adjusted EBITDA of US$702 million to US$722 million.

The acquisition also fits a pattern McGraw Hill has been building internally. Its AI Reader logged 11 million learning interactions in a single quarter, and management has said its in-house content generation platform, Scribe, paid back its investment within a year. Buying Teachally extends that from generating content for the company to letting teachers modify it themselves. The competitive backdrop is a K-12 market where districts are cutting spend, where Pearson, Houghton Mifflin Harcourt and Cengage are running similar AI plays, and where free tools such as MagicSchool and Khanmigo have already trained teachers to expect AI lesson-planning at no cost.

What Stands Out

"Teachers spend hours every week adapting materials to fit their classrooms. McGraw Hill understands the value of trusted curriculum better than anyone, and together we can put these tools in front of every teacher who needs them." — Daniel Bernstein, co-founder and CEO, Teachally

Regional Relevance

For the United States, the deal is a signal about what AI is worth in education, and it is not what the 2023 hype implied. A publicly traded publisher generating more than US$2 billion a year bought a five-person company that had raised almost nothing. The value being acquired is a working product and a team, not scale. That is the acqui-hire pattern of a maturing market, and it suggests incumbents have concluded that owning the workflow layer matters more than licensing someone else's model. It also lands while McGraw Hill is under pressure to prove its post-IPO story: Platinum Equity took it public in July 2025 at US$17 a share, below the US$19 to US$22 range, raising about US$414.6 million at roughly US$3.25 billion and keeping 84.6% of the company.

The localization capability is where the international read comes in. McGraw Hill explicitly cited translation and adaptation to different standards frameworks as a reason for the purchase, which is the expensive part of selling US curriculum abroad. Traditionally a publisher entering Mexico, Colombia or Brazil has to rebuild content around national curricula, in Spanish or Portuguese, at a cost that only works in large markets.

For Latin America, that lowers the barrier in both directions. If adapting a US curriculum to a Mexican standard becomes a software task rather than a multi-year editorial project, foreign publishers become more competitive against regional houses such as Santillana and SM. It also means the same tooling, once it exists, is available to any regional publisher willing to buy or build it, in a set of markets where public education budgets are tight and per-teacher preparation time is scarcer than in the US.

The Other Side

Does a five-person product survive contact with a US$2 billion publisher? Teachally worked because it was small, unfunded and fast. Integration into a company with compliance reviews, state adoption cycles and an existing content pipeline is where most small edtech acquisitions lose whatever made them useful. Bernstein's own comment that the company "didn't take in a pile of money" is a description of a culture, not an asset that transfers.

Can a paid tool compete with free ones teachers already use? MagicSchool, Khanmigo and a long list of free AI lesson planners have already reached classrooms. McGraw Hill's argument is that its curriculum is trusted and standards-aligned, which is real, but it also means the company is selling the content and the tool together. Teachers who like the tool and not the curriculum have alternatives.

Is AI a solution to the K-12 revenue problem or a distraction from it? The 11.2% decline in K-12 reflects district budgets and adoption cycles, not slow product development. Faster content creation improves margins and may help win adoptions, but it does not put money back into school systems. Investors will want to see the acquisition show up in billings, not in interaction counts.

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