Stephen Swad, the President and CEO of Rosetta Stone Inc. (RST), Interviews with The Wall Street Transcript

Wall Street Transcript

67 WALL STREET, New York - August 30, 2013 - The Wall Street Transcript has just published its Education Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Gainful Employment Clarification - Enrollment and Retention Trends - Economic Recovery and Enrollment Trends - Growth Drivers in Chinese Education Sector

Companies include: Rosetta Stone, Inc. (RST) and many more.

In the following excerpt from the Education Report, the President and CEO of Rosetta Stone Inc. (RST) discusses company strategy and the outlook for this vital industry:

TWST: I was going to ask you about those acquisitions. Is there anything you'd add in terms of why they made a good fit for the company?

Mr. Swad: There were two things that drove us to the Livemocha transaction. The first was that the company has a state-of-the-art, robust and extensible learning platform. That platform was something that we were in the midst of building, and we saw it nearly complete at Livemocha. Purchasing the company accelerated us by about 12 months toward that end destination of having a flexible learning platform. And the second reason we bought it is Livemocha has an extremely largely community of language learners that totals over 16 million - one of the world's largest language learning communities - and we thought that would be a nice complement to the suite of products and services Rosetta Stone owns. So those two things really capture the reason for the Livemocha acquisition.

With respect to Lexia Learning, that acquisition was in the beginning of August, and it was the first acquisition to extend our company beyond language learning. As Rosetta Stone grows, we're evolving the company from being a very strong force in language learning to encompass the broader area of learning through the use of technology. Lexia is a reading technology company, and I believe reading represents a tight adjacency to language learning and a natural place to take Rosetta Stone as we extend into new categories of learning. Purchasing Lexia was a key move in executing against that strategy.

You probably know that about 30% of our business is driven by...

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