Originally published on Startups Magazine in February 2021.
The UK edtech market was predicted to increase to £3.4bn by 2021. With £90.9m invested into edtech companies in 2018, up from just £9.9m in 2013, this market is clearly growing. However, when schools first closed due to COVID-19, and again at the start of this year, it became clear that many were understandably underprepared for the enforced radical shift to tech-led remote learning. Teachers struggled with the transition to online work, and many students lacked the necessary devices and connectivity to engage effectively online.
While it is clear that the pandemic has created opportunities for e-learning providers, it has also highlighted the structural problems at the school level that has hindered its rollout. However, edtech goes beyond just school age, and further opportunities for remote learning have opened up within the adult learning space.
With a growing number of adults looking to upskill remotely, and managers looking for new ways to train staff whilst separated from their teams. This has put a dent in some people’s expectations for the rate of adoption of edtech. There is hope for edtech though, with a growing market for adults looking to upskill, and businesses seeking to pivot to a remote environment.
With furlough currently due to end in April, many economists are predicting a wave of unemployment that has been deferred by this scheme. Combined with the job losses that already occurred during previous COVID-19 lockdowns, there will be a lot of people out there that are now looking for a new job. This has already been recognised by the Labour party, who have called for an extension to the furlough scheme under the form of a ‘smart’ furlough, which will include training to help workers improve their skills.
However, this will still prove difficult for many when everyone is being advised to remain at home and traditional routes to reskilling such as universities and other education centres are closed. This has meant users are crying out for more opportunities to upskill while at home to help them find their new role in a more digitised, and potentially more remote, economy.
As well as increased demand from users looking to reskill, businesses are also increasingly having to onboard and train workers remotely due to orders to stay out of offices if at all possible. This has meant managers have been less able to share knowledge in person and upskill their team. Likewise when a new hire arrives it is now more difficult to onboard them into the ways of working at the company, and ensure they know the fundamentals of the job they have been hired to do. This has meant that managers are looking for solutions to help continue the development of their team in a way that they can measure and observe while not being in the same room.
The final factor driving demand for e-learning solutions will be the needs of new entrepreneurs who have never run a company before, but have decided to start one up following redundancy or other COVID-enforced changes of circumstances. Throughout history there has been a correlation between economic downturns and people starting their own company - famous examples from the 2008/09 period following the global financial crisis included Uber, Venmo, and Slack. This downturn is no different, with record numbers of new businesses expected to have been created in the UK over the last year. Compared to seasoned entrepreneurs who already have experience running a new company and a network in place that they can draw on, many of these founders, while having traditional business skills, will not know how to run a startup.
Especially in the early days, they will need all the support they can get. This is where edtech companies can help by opening up entrepreneurship resources, such as networks and guidance on the journey they are about to take, to a wider audience. Some traditional education providers have already taken the lead here - Stanford Graduate School of Business’s Embark platform, launched before the pandemic in 2019, provides subscription access to a toolkit of entrepreneurship resources, making teaching from its world-leading faculty available to anyone.
We are already seeing the beginning of an edtech boom. There is greater venture capital interest in the sector than ever before, with funding globally increasing by $6bn between 2014 and 2018. There has also been the biggest raise in the UK for an edtech company, with Multiverse securing $44m from investors earlier this year.
However, despite these strong pull factors that will help drive the growth of the edtech market, there are also some problems ahead that investors and founders will need to be aware of. Mainly that - although we are living in an increasingly digital world - not everyone is lucky enough to have constant access to a laptop or computer, especially if they are living in a house with children who also need access for their remote learning.
As well as this, the UK specifically is still lagging on implementing full-coverage high speed broadband. In order to solve these issues, there is a need for a more centralised approach that can only be provided at the government level. An approach where public institutions like Job Centre Plus partner up with privately owned edtech businesses to help deliver these services.
Growing demand for e-learning, as a result of the economic turmoil, is not enough to make edtech successful. The new wave of edtech solutions have to combine much more than just providing content and skills certification. New edtech businesses will succeed if they are able to go beyond what was traditionally considered as edtech and extend their solutions to career coaching and recruitment via use of new AI, machine learning and data analytics technologies.
What we need is an easy way to link an individual - his natural talents, interests, experience, capabilities and personal goals with (global) market needs and existing or future job and business opportunities. The role of the edtech companies is then filling the gap in between by offering the right upskilling, coaching and educational path to a successful career. Multiverse is one of the best examples of companies that effectively combine education and career, however we need more businesses going in that direction in order to see a real change in the damaged job market.