Edtech 2022: The Year That Was… And Wasn’t

While technology in education is here to stay, edtech platforms, education institutes and all other stakeholders in education need to find a way to navigate how best to use this tool after the pandemic

Long considered a sunrise industry in India, not only was Education revered as the holy grail it was considered recession-proof given the incredible market size and the importance set on lifelong learning in all Indian households. 

Already booming with a whole raft of high-profile unicorns, the EdTech industry received unexpected tailwinds in the form of COVID, which forced offline learning to shut its doors for the better part of a year and a half and force everyone to experience a digital universe that was otherwise considered elitist. However, projections made during ‘non-normal’ times tend to result in valuation errors and the brunt of such mistakes often land at the doorstep of investors and employees. The reopening of the world post-Covid has resulted in a funding winter that would put the harsh cold winter beyond the wall to shame.

Substantial Investment has been made in creating and promoting digital education platforms in India. The EdTech private sector comprises players who have grown in the education space over the years and stand on their strong offline and online businesses and players who have emerged and grown only in the past three to five years. The new players had raised massive amounts of funding in recent years, though the slowdown in funding is now very apparent. The student acquisition focus has shifted back to sustaining or earning profits for survival. Entities riding on the new wave are finding it difficult to sail through the heavy winds of the slowdown, whereas companies with strong fundamentals and focus on content have not just survived, but are beginning once again to thrive.

Re-enter the traditional stalwarts of the Education industry, now armed with technology at their fingertips ala Covid, and the EdTech industry is reborn in hybrid form. The use of technology for teaching and learning has overcome what many would have believed to have been insurmountable challenges in the education space. Digital content can be accessed anywhere anytime and is easier to generate as compared to printed content, especially given how inflation is driving up costs of paper worldwide. Traditional players with their strong balance sheets, stable cash flows and brands built on years of excellence are now competing on an even keel with the new age start-ups in a world where Profit rather than Monthly Run Rate suddenly rears its realistic head.

As per a recent McKinsey report on the EdTech sector, Venture Capitalists in 2021 have invested 40 times what they had invested in 2020 globally. Profitability though can only be achieved when the lifetime value of these students exceeds the high acquisition cost. Economies are important to sustain in the sector. Companies across the globe are using mergers and acquisitions and the same trend has emerged in India. The downsizing after these mergers and integration of operations has been challenging, with some having failed to meet acquisition payment deadlines.  

Coexisting with hybrid survivors of Covid, EdTech companies have come full circle to that basic core purpose for which all exist - delivering value for students. Slick advertising, massive budgets, sponsorships, etc. are all making way for a basic deliverable – to deliver unmatched value. Be it school augmentation, coaching, training, upskilling or professional learning, the mode of delivery is incidental – it's about convenience to students and adjusting to his / her learning style – what’s most important is that the student feels genuine value addition from the learning imparted.

Questions offline or online are now passe. There are those who need the physical touch model to learn, others need to learn at their own convenience and given the massive number of students that India caters to across schools, colleges, tuition, professional learning, etc. there is no dearth of opportunities, pushing educators and policymakers to the limit. Survival of the sector depends on how EdTech companies continue to innovate in these distinct product markets and leverage new-age technologies like Metaverse, Augmented Reality, Virtual Reality and so on. New markets also deliver new possibilities, be it in the form of the new CUET (Common University Entrance Test) introduced this year, or the bull rush for international education facilitated by a two-year global lockdown. On their part, the Government is doing their bit to push for digital education through the launch of the Swayam Portal and focus on multidisciplinary and interdisciplinary degrees in the New Education Policy (NEP) 2022. These have paved the way for greater digitalisation than ever before.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house

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