Edtech Startups Continue to Grow Amid Covid Challenges
With the outbreak of pandemic and subsequent lockdown all over the country, online education and edtech platforms have seen a dramatic rise as most of the schools and institutions have been temporarily shutting down. The new 'work from home' model has also enabled professionals enroll for various professional courses related to data science, analytics, AI & Machine Learning, among others to better themselves. These altogether has driven the rapid rise of edtech startups in the past few months.
Edtech segment is likely to be on a roll ahead as investors globally are expected to put $87 billion in the world market over the next 10 years, according to market intelligence firm HolonIQ. The India market is also believed to grow at over 20 per cent per annum to hit $2-billion size by 2021, as per management consulting firm Ken Research.(source: financialexpress.com)
Edtech segment is likely to be on a roll ahead as investors globally are expected to put $87 billion in the world market over the next 10 years
Other than the opening up live-learning platforms for school and college-goers and professionals, startups in edtech have also seen a spurt in fundraising with investors interest on searching for firms that can benefit from the online learning wave amid covid crisis.
Securing Funds amid Crisis
As per industry reports, edtech startups have reportedly secured twice the funding as compared to last year. Investors have significantly invested around $795 million in Byju's, Unacademy, Vedantu, InterviewBit Academy and Doubtnut.com. A report states that edtech is the only sector besides healthcare to register a rise in their VC deals in H1 2020. Overall, the sector raised $795m in 25 deals (vs. H1 2019's $296m).
"Finally, in the new economic world where a preference for digital mediums will demolish old methods of conducting business, new-age startups backed by innovative capital will redo the established order. Edtech will be one of them," says Anirudh Damani, Managing Partner, Artha Venture Fund.
Byju's and Unacademy, the two well-known edtech startups bagged investments in the first quarter of this year - $400 million and $100 million, respectively. In fact, the average number of edtech startups raising funds is almost that of 9 out of total 14. Vedantu too led the game by securing $100 million as part of its Series D round.
"Facebook's recent investment in the Indian Education market with $50 million in Byjus is the evidence for the fact that investors have faith in the opportunities in India," says Suresh Rangarajan, Founder & CEO, CoLive.
Apart from funding, these startups are aggressively revamping their hiring process to cater to the new demands of the market. Many of them are gearing up to double their employee strength across roles of sales, technology, content creation, and product development.
A Bright Future
The rapid spread of the virus has to a great extent transformed the way education was perceived, if not permanently. Technology has been an enabler in such difficult times at least helping hundreds of students get connected through online platforms. Cashing in on the right opportunity at the right time, the edtech startups that are bringing in a paradigm shift in education are expected to rocket to great success.