Let me guess. You have a great idea for an edtech startup but you don’t feel confident whether you should pursue it or not.
Starting a company can seem impossible, especially when it’s your first time.
But the good news is, unlike most industries the edtech industry has a lot of room for innovative edtech startups to enter and succeed.
But of course, you can’t just solely depend on past data and future projections.
So in this article, we’re going to share 5 reasons that prove why edtech is a good opportunity to launch a startup today.
5 Reasons That Prove Investing In An Edtech Startup Is Worthwhile
If someone had asked me five years ago if they should launch an edtech startup, my answer would have been “absolutely not!”.
At that time, I was as naive as you might be today.
I had the same concerns:
- Would teachers trust our technology?
- Will schools deploy our product?
- How would students react?
I was as uncertain as you’re today.
But, it’s been five years and we’ve witnessed many best edtech startups rise globally.
Moreover, being in the mobile & web development services industry for more than 7 years now, the following reasons have changed my whole perspective about edtech startups and I’m sure after reading them, your perspective will be changed too.
So, without wasting any more time, let’s dive right in.
Edtech Is Billions Dollar Industry & Growing
If you compare the education system globally, the Asian education system is the largest in the world. In 2016, the Chinese edtech startups received $1.2 Bn in investments. And the same number is expected to grow at 20% per year.
India’s online education market, for example, is also expected to reach $1.96 Bn by the year 2022.
What all these data show us is that there is a sheer potential for new edtech startups. And this is mainly due to the culture of continuous learning promoted by top companies across the world.
Nowadays, both parents and students know the need for effective learning solutions, which are being provided by edtech companies.
Here’s a graph that shows the feedback of students on using technology for education.
As you can see from the above statistics, more than 50% of students already believe in the potential of education technology.
There Are Many Unexplored Opportunities
Despite the education technology being super popular among edtech investors, the number of companies utilizing it is significantly low.
In fact, if you look at specifics, there was nothing much new in AR/VR Apps for education as well. The gamification field also experienced little development in 2017. That means, both AR/VR & Gamification is still waiting for entrepreneurs to use it profitably.
On the bright side, the Social Emotional Learning concept did receive a huge positive response from the educators, but not among the edtech entrepreneurs (yet).
What all these studies show is that there is clearly a massive amount of unexplored opportunities in the edtech industry.
Edtech Startups Attract Incubators & Accelerators
90% of all startups fail within the first year. While this fact might scare you from pursuing your startup idea, but thanks to Incubators and Accelerators, you don’t have to be one of those 90% startups.
Though Incubators don’t focus solely on helping startups alone, they’re still valuable for budding edtech startups. Incubators can provide the needed training, consulting, and networking opportunities to give your startup a jumpstart in its early days.
Accelerators, on the other hand, can provide the seed funding along with training and consulting in exchange for a share in your startup. While you may not like the idea of giving some percentage of the stake of your startup, but Accelerators are a great option for entrepreneurs with no capital.
In fact, since Accelerators invest money from their own pockets, they’re more committed to helping a startup succeed.
Currently, Teclabs, Started & Intel Education are among top accelerators focused on investing in education technology startups.
There Is Still Room Left For Innovation
While edtech has already been a buzzword for the past recent years, but there is still a lot of room available for innovation.
For instance, Angel.co has listed over 16,000 education startups. But their education startup counts everything, from survival classes apps to language-learning apps.
Now, if you compare the number of education startups listed on Angel.co with the number of schools and universities, you will agree with the fact that there is indeed room available for new edtech innovations.
In the US alone, there are 3,500 universities, 15,00 community colleges, and 14,000 public schools. Do you really believe all 16,000 education startups are serving these institutions?
Hence, there is lots of room left for innovation.
Investors Are Eager To Invest iIn Edtech Startups
Edtech companies raised a record-breaking $1.85 Bn funding across the US and $3.12 Bn globally during 2015.
Though the next year funding did cool off a bit, but the pattern of long-term edtech investment growth is clear:
In fact, today there are established venture funds like newschools.org that only invest in edtech.
The point is, now is a great time to enter the edtech industry.
Now, if you want to launch a startup in the edtech industry but think that your idea is so simple that no investor would be interested to fund it, consider reading the case of Peergrade.
Launched in 2015, Peergrade was built with a simple idea of helping teachers pay close attention to and give a fair evaluation to a growing number of students.
Peergrade founders realized a common problem amongst educational institutions that due to budget limitations, teachers were forced to teach a large number of students and expected them to still give the same level of close attention and fair evaluation to students.
So, Peergrade founders came up with an idea that would allow students to evaluate and grade each other’s homework and assignments through peer assessment session.
Teachers would simply create online assignments and list all criteria for evaluation. Once students are done evaluating each other’s work, the teacher then receives a full overview of the session.
Today, Peergrade is being across major universities of Denmark and neighbouring countries. The startup also received a whopping $300,000 in seed funding.
The world is in dire need of entrepreneurs like you who wants to launch an edtech startup. So, if you’re brave enough and wants to work in a meaningful industry to make an impact on student’s lives, then yes! – right now is the perfect time to launch your edtech startup.