Category Archives: Edtech

How many edtech companies are exporting more than $20M each year?

Source: HolonIQ

Source: HolonIQ

The promise of education markets is well marketed.  Estimates have been made that global education and training spend will reach approximately $10T (that’s $10,000,000,000,000) by 2030, about 6% of global GDP, with approximately 55% spent on the K-12 sector (somewhat above $3T this year).

Global edtech spend is forecasted to grow from $152B in 2018 (a paltry 2.6% of total spending) to $342B in 2025 (a slightly less meagre 4.4%).

Growth in edtech spend

Source: HolonIQ.com

Applying technology to learning and teaching should be a massive opportunity to both improve learning impact and to build a successful business, right?

I’m convinced on both counts.  But if global spend on K-12 is $3T then why is the spend on edtech so relatively modest? It’s mainly important to remember that about 80% of spending in K-12 is on teachers and other staff, with additional spending on other fixed costs such as buildings. Conceptually, in a pure-play digital future, in which teachers might be replaced with AI and robots, this could be an addressable market. However, this seems unlikely to happen at scale any time soon, since it would be not only pedagogically unsound but also socially unacceptable.  (It’s my own belief that the human teacher is the “killer app” in education).

Spending on Staff

Source: OECD Education at a Glance 2018

It seems more likely that technology will be used to super-charge teachers and enable more flexible organization forms for teaching.

Is there a global market for K-12 edtech?

If we would assume for the sake of argument that 2.6% of spending on K-12 education is digital (see above), this would imply a current spend of about $85B.

I would like to understand how much success the edtech industry is having in scaling internationally. How much of the $85B is being spent on local vs global solutions and how big is the opportunity for global vendors? It’s important for us to understand this dynamic as an industry: it will inform our investment decisions and potential to make an impact on learning.

Although the edtech market is not yet very mature, it is of a sufficient scale that we should expect to see successful global operators in edtech in K-12, if the market has a (partially) global nature.  Imagine we set a very low threshold: 0.025% of $85B spend, roughly $20M.  How many edtech companies are there in K-12 today who are generating $20M sales or more each year on edtech offerings being sold outside their market of origin?  More than 100? Less than 10?  I simply don’t know, my guess is there are tens rather than hundreds or thousands.

Who is exporting more than $20M?

I am very keen to discover and understand examples of such companies (exporting more than $20M of edtech each year outside of their home markets in K-12).  I would appreciate it if you would reach out to me when you know of good examples, or if you know of any good reports on the subject.  (Of course there are a number of examples I am aware of and I am excluding the likes of Apple, Microsoft, Samsung and so on, which are more generic tech solutions than specifically edtech).

Assuming it’s likely the international opportunity is currently under-developed, are there things that we can do together as an industry to unlock this potential?  At Sanoma we have successfully scaled our bingel platform in primary education across geographies, and are now working on the same with Kampus in secondary education.  Therefore within a Group it seems to be possible.  Are there other examples across Groups or through partnerships that have scaled successfully across international markets?  What can we learn from these examples?

HolonIQ

Source: HolonIQ

The Chinese, Americans and Indians have the advantage of huge internal markets.  At the same time, many of their edtech ventures are focused on capturing that big local opportunity.  However, it seems only to be a matter of time before some of these companies go global.  Whilst lacking their scale, could we Europeans (better) develop the capability to scale across geographies as a competitive advantage in edtech?  What would we need to do to make that happen?

Of course it’s a possibility that K-12 education and edtech markets will remain mainly local.  In which case we as an industry can adjust some of our investment hypotheses accordingly.  Yet I expect growing teacher shortages, pedagogical innovations and technological progress will drive change in our markets. We should organize ourselves to be ready for these changes.

 

Scaling European Edtech

I recently came across this interesting report from Navitas Ventures – Global Edtech Ecosystems 1.0: Connecting the World of Education Technology.  Navitas analysed 20 cities with leading edtech ecosystems representing about 40% of global edtech.  Beijing, the Bay Area and New York are top of the class, with Boston, London and Shanghai challenging.  They also assessed a further 14 emerging ecosystems at different states of maturity.  It’s clear that edtech is thriving across the globe!

Scale is essential to success in digital and you can see that in edtech too, with the predominance of China and the USA.  In addition, given the demography and emerging status of the edtech ecosystems in India and Sub-Saharan Africa, it’s likely that together these four regions will give birth to a generation of edtech giants.  Edtech could significantly improve the life chances of hundreds of millions of people in these regions by increasing access, participation and engagement in education.  It’s a powerful promise!

HolonIQ

Source: HolonIQ

What about Europe?

Europe has some natural advantages in the edtech space.  We are home to many world-class education systems such as Finland. There’s a rich start-up scene in a number of European cities with London leading (but will Brexit make us BETT-sick?). Paris, Stockholm, Berlin, Helsinki and Amsterdam are vibrant and promising too, in fact there are more than 3000 edtech ventures across Europe today. Furthermore, there is significant and reliable spending on education through governments and ready access to venture and growth funding privately.

However, we lack scale

A lack of scale probably results in us under-serving our own customers.  It restricts our ability to expand to international markets. And it potentially exposes us to competitors grown in the big markets.  A lack of scale is restricting our potential.

European Champions

To address this, I think we need to create a European edtech network with strong go-to-market capabilities so we can effectively scale successful concepts across the continent.  I believe this network would be well served if it includes a handful of Champions to acts as magnets to talent, ideas and capital.

Learning organisation

I am interested in your ideas about how we could bring more scale to European edtech and what you think about the idea of building a European network with Champions.  How could we make that happen?  I’m also curious to learn from some of the challenger and emerging edtech ecosystems: how are they approaching this, what’s working and what’s not?  Learning is in our DNA, we need to put those skills to work if we are to bring this potential to life.

Sanoma’s Start-up Challenge Five Years On

Five years on from Sanoma’s Start-up Challenge on the Future of Learning at TNW2014, I checked out how the five finalists have fared.  I’m impressed!

Winner Labster raises growth funding

Winner of the Challenge Labster has been prospering and announced at the end of last month raising $21M in a series B round to develop more digital lab simulations and to grow in the US market.  Next stop the World.

DragonBox joins Kahoot!

Maths app developer DragonBox announced today that it has been acquired by Kahoot! for $18M.  Their claim is that together they are going to make learning maths awesome!

ClassCharts wins BETT

Edukey’s ClassCharts, a seating planner and behavioural management tool, has gone from strength to strength based on the close understanding of teaching and the classroom underpinned by a strong data and analytics capability. Edukey won Company of the Year at BETT2019.

Jumpido combines movement with software to boost maths learning and looks like quite a fun thing to do in primary schools.  Although the website is still active and the company was a finalist at the Forbes e-volution Award in 2016, they have been rather quiet since.

The website for the final contender Eduvee, an intuitive learning and tutoring platform, now re-directs to the education page of custom software and consulting company Elinext, likely indicating that some form of major pivot has taken place for this company.

Impressive

Overall it’s really impressive to see how much success these companies are achieving.  We were lucky to have selected such a strong cohort for our Start-up Challenge.

Inspiring

What I found inspiring in all of the contestants at the time was their deep understanding of their customers and their passion and drive to make a difference.  Five years on you can see the positive impact of the energy they have put into their ventures.

Looking forward >>

I’m curious on how far these companies will go in the next five years, and wish them every success in turning their ambitions into reality.

Edtech: hotter than the Acropolis in August

At the beginning of the week I was in Athens celebrating my birthday. Let’s just say I was born in the 1970s :). I’ve always had an interest in Greek mythology (it was a good choice to read Mythos on the way) and as a man of learning, I wanted to see more of the homeland of Socrates, Plato and Aristotle.  An inspiring and thoroughly enjoyable visit!

News broke of the sale for $1.75B of plagiarism-checker Turnitin, more than the total amount that all edtech startups raised in 2018 ($1.45B) and also one of the biggest edtech deals this decade, beating LinkedIn’s purchase of Lynda, but smaller than the Ellucian deal.  This underlines the growing importance of technology in learning markets. In the meantime, Sanoma Learning is, with the intended acquisition of Iddink Group, emerging as Europe’s leading edtech company, with a couple of hundred million euros of digital/multichannel revenues and more than 300 tech employees.  It’s a hot place to be.  Hotter than the Acropolis in August!

The immediate focus back at the office was the steering of our High Five program.  At the beginning of March we went live with our Next Gen EdTech Team, where we have created one technology team for the whole of Sanoma Learning. It was good to see we are well on track to launch Kampus in Finland & Sweden, and Bingel in The Netherlands.  Overall I feel we are making great leaps forward with High Five!

Then we spent time with the Iddink team in preparing ourselves for finalizing the intended transaction.  There’s a good click between us, which is a great starting point.

At the end of the week we did the monthly business reviews with each of the units. We’re deploying a new stage-gated investment process into new courses and had a couple of very interesting cases from Poland. I was highly enthusiastic about how the team is approaching this and really appreciated to be able to spend time with them to learn more.  Well done!

Looking forward >>

Five Reasons Why Blended Learning is an Ongoing Success in Finland

 

This week I joined the education event Dare to Learn in Helsinki with colleagues from Sanoma Pro. With 3000 participants from over 20 countries it was well organised and people were in a positive spirit. Thanks to the organisers for having done a great job!

Finland has a world-class education system with several factors underpinning the success including skilled and respected teachers, high levels of equity and trust in the system and an holistic view to the development of children. Education professionals from around the globe are interested to learn about the Finnish ways.

I think that blended learning is an enabler of excellence in Finnish education and gave a keynote talk on this topic, with the headlines:

1.   Blended learning plays to the natural strengths of the local education system, enabling the excellent teachers, taking advantage of the high quality curricula and materials and putting to work the technology available in schools and homes.

2.   Blended learning models are practical and flexible as schools transform to a more digital future. Our research indicates that teachers are increasingly ready and willing for the digital transformation. We’re also witnessing the emergence of new pedagogies such as phenomenon-based learning, and blended solutions can be very helpful enablers of these new pedagogies.

3.   Blended learning supercharges great teachers (and there are many of them in Finland). A Sanoma Learning solution typically saves a teacher about 8 hours of working time each week – time which can be channelled into individual attention to pupils. And with dashboards and personalised learning pathways, teachers have excellent insights and tools to guide interventions.

4.   Blended learning motivates and engages pupils in their learning endeavours. Our learning impact surveys have indicated that 95% of teachers typically report that integrated learning methods help them to engage pupils with learning. Some like printed books while others prefer online materials. Nowadays boys often lag behind girls in learning. Our analytics indicate that gamified solutions integrated into the approach such as bingel are especially motivating for boys, providing a way to bridge this gap.

5.   Blended learning supports pupils’ achievement and outcomes. Blended learning is a step towards personalized learning, which takes pupils’ personal achievement level and preferences into account. In our surveys, 85% of teachers have reported that such solutions help the pupils to achieve their curriculum goals.

 By applying blended learning methods and techniques, Finland can stay on top of its game in education. Teachers can make the most of their teaching and pupils stay motivated, which helps them to achieve their learning goals.

* Blended learning is mix of various event-based activities, including face-to-face classrooms, e-learning and self-paced learning.

Organising for the digital transformation in Belgium

de boeck blog

I’m really happy that we have acquired the educational publishing activities of De Boeck in Belgium. Welcome to our new colleagues! Click here for a short vlog about it.

logo_deboeck

De Boeck is a trusted brand with a good market position, making about € 17 m of revenues in 2015 and employing about 80 professionals. They share our passion for education and learning and there’s a very good fit with our mission of helping teachers to develop the talents of our children.

mission

Why?

Demand for multi-channel learning solutions is increasing. Our customers tell us that digital can support learning impact: improved engagement and higher learning outcomes for pupils and better workflow efficiency for teachers. A great example of using multi-channel to enable learning impact is bingel. So we made this acquisition to enable the digital transformation of learning and teaching in Belgium. We are working hard to organize ourselves effectively for this.

How?

We intend to combine the complementary high quality portfolios and well-developed learning design capabilities of Van In and De Boeck.

This will bring more scale to our significant investments in digital across these high quality portfolios.

We can realize synergies in our operations as we create a new organization ready for the future.

Looking forward >>

Bringing together two great companies, Van In and De Boeck, will help us to better fulfil the needs of our customers, today and in the future. Good luck to the new team in making this a success!

Education reform in Finland

kirsi

This week I caught up with Kirsi Harra-Vauhkonen, Managing Director of Sanoma Pro, market leader in Finland. The Finnish market is currently undergoing both a major curriculum change and digital transformation.  I asked Kirsi to explain more about what’s going on.

You’ve got an interesting background Kirsi, including positions at Nokia and Google. Tell us more.

Continuous learning is my passion, and I have been fortunate to be able to gain experience from many different positions. I have worked for example in recent years in telecommunications (Nokia), digital media (Google) and now in educational publishing. During my career, I have worked mostly in commercial and business development leadership roles. Mostly I have been leading change – be it new opportunities in the market, new ways of working or digital transformation.  I am driven by working with great people and teams.

Finnish education has a world class reputation. Why is that?

Finnish pupils have scored highly in the PISA surveys for many years. This is a result of the high quality public education system in Finland. Excellent teachers are one of the most important cornerstones of the system. All teachers have a university degree, and being a teacher is a highly respected profession. The fact that high quality education is available for everyone, is very important for Finland. High quality, versatile learning materials also play an important role in helping pupils and teachers to achieve excellent learning outcomes.

What role does Sanoma Pro play in Finnish education and why are our methods popular?

Sanoma Pro is a major publisher with a very good reputation and the most extensive offering in the Finnish educational market. We publish learning materials for all grades K-12 and also for vocational education. In addition we also have the Oppi & Ilo edutainment line for the consumers as well as tutoring services by Tutorhouse.

Our learning materials are used in almost every school and class, and our digital learning environment has more than 100 000 active teacher and pupil users. Our solutions are developed through very intensive collaboration with our customers, and our authors are the best professionals in their own subjects.

Our solutions are popular because they are high quality, they fit the curriculum perfectly, they are easy to use, and they have a good mix of print and digital elements that match the ways and needs of the classroom.

And they provide excellent benefits by enabling learning impact: they help pupils to achieve good learning outcomes, they engage and motivate pupils to learn, and they save time for teachers in their professional work.

 

There’s curriculum reform coming this year and next. What’s happening and how are we supporting the change?

The reform is a combination of driving change in the pedagogy and in the learning goals and related learning contents. First of all the reform is encouraging strong engagement of pupils and thus changing the role of the teacher to become more like a coach for the active pupil learners. Another theme is to update the learning objectives to equip children with such skills and knowledge that better meet their needs of the future. Also the need for more theme-based learning is emphasized as well as the aim to bring digital into the everyday work at schools.

We have integrated these themes in our methods, in addition to the new learning contents, and provide a lot of supporting tips and tools to help the teachers to adapt to the new ways of teaching.

 

What are the most important digital initiatives we are working on?

We are very excited about our new digital learning solutions. It’s now possible to use fully digital learning materials for teaching and learning in all of the primary subjects in the new curriculum. In addition, for the teachers who prefer a hybrid solution, we are launching the gamified, curriculum-fit exercise environment Bingel. Bingel supports seamlessly the Sanoma Pro learning methods and makes exercising engaging and inspiring for pupils.

In upper secondary we have Kompassi, the digital testing and assessment tool that provides teachers an easy way to create and assess tests, saving a considerable amount of their time and providing students with the opportunity to get familiar with the digital testing. The first national digital matriculation tests in Finland will take place this Autumn.

What are you most proud about with Sanoma Pro?

I am very proud of our extremely professional and talented team. Going through a phase of digital transformation in the market simultaneously with the very intensive curriculum change is not an easy task, but the team has shown great effort and we have been able to bring all the print and digital products to the market, while also innovating new concepts.

Our new learning solutions bring a lot of new opportunities and support for the teachers to renew their way of teaching, and to engage and inspire the pupils. I am very proud of this achievement, and having delivered this as a team!

 

Exciting times

Thanks for talking us through this Kirsi.  These are exciting times in Finnish education and it’s great to hear more about our commitment to working together with our customers in bringing new innovations to the marketGood luck to all our people in Finland!