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According to HolonIQ research, $16.1B was invested in the EdTech companies in 2020, which is twice the amount in 2018. In total, the volume of the EdTech market grew by $1T and reached $5.2T from 2010 to 2015, while in 5 years the market volume may grow to $7.3T.
We talk to startups and investors, you get the value.
The global pandemic has taken its toll on many markets, but not the EdTech one, where the effect was the opposite. The forced transition to online gave the EdTech market powerful incentives for growth and opened up new opportunities.
There is also another factor contributing to the development of the industry, namely constant and stable audience growth. Over the past 30 years, the consumer education market has grown by 2.3B people. The world’s population is growing, especially in developing countries, and so does the importance of education.
In November 2020, there were 20 EdTech companies among the world’s unicorn startups. Asian companies rate the highest (top 4), followed by American ones, like Duolingo, which also operates in the CIS market.
EdTech startups compare favourably with learning “the old-fashioned way”: they apply new technologies, surprise, entertain and strive to please the client in every possible way.
EdTech itself appeared to solve the main problems of offline education: high cost, the dependence of the quality of education on geography, time costs, difficulties in finding quality services, and more.
Most startups are working on consumer engagement. This is a crucial advantage now when the abundance of information noise makes it more and more difficult to concentrate.
The use of technology allows us to adapt to the needs and interests of the consumer, which makes the educational process simpler, more flexible and effective.
EdTech projects are online, and, of course, this speeds up the learning process.
The Internet is now almost everywhere, thus solving one of the main problems of conventional education — the dependence of its quality on the territorial principle.
The share of startups from the CIS countries in the global EdTech market is still relatively small: for example, the Russian market in 2019 was RUB 45–50B, which is approximately 1% of the global market. But here, too, the EdTech sphere is actively progressing: the growth dynamics of the Russian market is 20–25% annually.
There are also regional difficulties: an example of such a complex area is educational services for schoolchildren in Russia. This sector is highly bureaucratic, a huge number of regulations and a system of work through public procurement prevent startups aimed at educating schoolchildren from working on the market. Perhaps the pandemic will change the situation: during the forced transition to online, the quality of school education has dropped significantly due to the lack of good digital products and platforms.
Skyeng is an online school of English that uses its own method of teaching English words.
«Netology-group» includes the center for digital-professions training “Netology” and the online school “Foxford”.
iSpring develops software for corporate training.
MAXIMUM Education offers online additional education for school children.
«Umney» is a distance learning portal in Russia and abroad.
SkillBox is an online platform for training digital professions.
«Uchi.ru» is an online platform for school education.
Hundreds of EdTech startups are developing in the CIS countries. We will provide an example of several successful startups that illustrate the main trends in online education. But they, of course, do not exhaust the list of startups that are changing the industry.
“Foxford” is a project of “Netology Group” that provides schoolchildren with training according to the school curriculum in an online format. The legislationallows parents to choose distance education for their child, and Foxford makes online learning simple, convenient and of high quality. They offer a regular school curriculum, additional modules, thematic classes and their own Olympiads, and each class has its own mentor.
The platform provides free access to educational courses from the leading universities of Russia: Moscow State University, MIPT, St. Petersburg State University, HSE University and others. Listeners can receive a certificate, and students can get credits for their university. Any user can get free access to all courses.
GoPractice is breaking new ground in the training of project and product managers. The course was created by Oleg Yakubenkov, an expert in game development who has worked in Joom, Facebook (got there after buying MSQRD) and API.AI (bought by Google). The GoPractice simulator is based on gamification. In fact, this is a game with a linear storyline, where the user becomes a playable character and goes through all stages of product development in practice. You conduct analytics, make decisions, receive instructions from customers and feedback from the team, and more. The game has many interesting plot twists and real cases from the life of large technology companies.
This service helps budding IT professionals find mentors. Mentors help understand complex issues, make difficult decisions, take a detached view of current problems, and shape the path of professional development. The startup was founded at the end of 2019 and raised its first investments in 2020, first from the vice president of Bank Saint Petersburg, Mikhail Gavrilov, and then from the commercial director of Yandex, Dmitry Kachmar.
Lectera is the online platform for courses in financial literacy, marketing, sales and leadership development that is based on the author’s concept of Fast education. All lessons take under 15–30 minutes, so you can easily integrate them into the working day. The knowledge is presented in a way that you can apply it in practice straight away. According to the founders, the startup has already received more than $3.5M in investments.
NOE-VE is an educational VR simulator for ophthalmologists. An accurate model of the eyeball has been recreated in virtual reality so that you can learn to treat various diseases and even perform surgical operations. The training is accompanied by an AI-based assistant. The company was launched by an ophthalmologist and digital designer Andrei Demchinsky, ophthalmologist Natalya Anisimova and PR specialist Elizaveta Shekoyan with the aim of providing high-quality training for future ophthalmologists.
An application that helps parents teach their children what they will not learn at school — financial literacy, dedication and time management. Parents assign children different tasks, control, observe and reward them with special currency. Children learn to plan, manage expenses, and achieve their goals. In 2020, the startup received investments from the Internet Initiatives Development Fund (IIDF) and a grant from the Moscow Seed Fund.
Cursometer is a startup for EdTech projects that helps get analytics for distance courses. Authors can see which blocks are watched, and which are skipped, as well as analyze the topics followed by the most dropouts. All this information will help improve the product.
The EdTech market is constantly growing, and the need for education is unlikely to disappear in the foreseeable future. Each new startup comes up with more and more mechanisms for engagement, game learning, and optimization of formats — and all together they gradually overcome inertia, making the educational process around the globe easier, more accessible and better. Even now, looking at the pace of development of online education and all kinds of technological innovations, one can make many assumptions about what education will be for people in the future. Or will VR stimulators replace conventional courses for good? Can a simple school child make their first startup and raise investments already in the 9th grade? Will changing 10–15 professions in a lifetime become the norm? Or maybe the next generations will learn foreign words and mathematical theorems in their sleep?
Right now, every new product on the EdTech market is bringing this fantastic future closer — and it’s all very exciting to watch.