Future of Educational Technology
Though global Venture Capital Investment has managed to stay stagnant during COVID, global investment in Educational Technology (EdTech) has hit a record high at $4.5 billion for the first half of 2020. Global EdTech is expected to reach almost $9 billion by the end of the year, which would lead to over a 28.5% increase in EdTech investment compared to 2019. The educational technology field has taken off during the pandemic causing Quizlet and ApplyBoard to both become Unicorns. With now over a dozen Unicorns in the education technology sector, investors are starting to realize the upside potential of EdTech.
The educational technology space on its own is heavily diverse, with companies focused on providing content and services while others are offering alternative forms of education compared to traditional schooling. Though many of the companies providing supporting content and services are continuing to shape how students study and learn, one of the biggest growth opportunities lies in companies trying to revolutionize K-12 education. As we enter this upcoming fall semester, students and families often have to decide whether they participate in limited socially distant schooling or adapt to a fully online experience. The additional consideration given to online education by over 55 million students currently in grades K-12 provides immense market opportunities for startups to establish themselves as dominant players in the EdTech space. The new levels of social acceptance and support of online education, due to COVID, has the potential to make online K-12 a competitive option to students of all backgrounds.
Though K-12 EdTech has the untold potential over the next few years, the value of attending prestigious universities online has come into question. Tuition for top Universities is planned to stay the same for the upcoming year with Harvard's Tuition planned on being over $50,000 for a fully online experience for over 60% of its undergraduate students. The large increase in students participating in online post-secondary education opens up opportunities for EdTech companies providing 1-2 year specialized degrees in fields such as engineering and computer science. Through creating online curriculum and leveraging interactive EdTech software like Canvas, to create virtual courses, and Kahoot!, to quickly check students' understanding of taught material, the traditional educational system will begin to be challenged.
The last sector of the EdTech field that could experience significant growth opportunities are companies adapting and finding new ways to create remote extracurricular opportunities. Though there is yet to be a significant innovation in this space, over the coming months students are going to seek extracurricular opportunities to fill their free time and interact with each other since after school sports and clubs are not likely to resume in the near future. One example of opportunities for student interest in entrepreneurship is called Founders Bootcamp, run by Roger Kassebaum, a Milken National Educator Award recipient and Wiase Capital Partner, which encourages students to create disruptive startups and provides financial support. As the COVID pandemic continues, and students become increasingly comfortable with remote education, EdTech companies allowing students to connect, learn, and interact could become the future.