i360 on Edutech: Mapping the EdTech Investment Landscape in Southeast Asia.

On 9 June 2020, we held a webinar panel discussion titled i360 on Edutech: Mapping the EdTech Investment Landscape in Southeast Asia. You can watch the recorded session via BLOCK71 Facebook page here.  We invited Maria Spies, Co-Founder, and Co-CEO, HolonIQ and Niko Lindholm, Programme Director of Eduspaze Accelerator  to lead the discussion on EdTech investments trends in the region and around the world, how new models and tech are shaping future of education and learning.

Below is the summary of the session.

Global Market Overview & Investment Landscape:

  1. In 2018, the total global education expenditure was US$ 5.9T and estimated to increase to $8.1T by 2025.
  2. Emerging markets in Southeast Asia are going to be driving the global EdTech industry due to it's large young population and GDP.
  3. The majority of US workers to freelance by 2027 , hence the rise of the "gig economy". 1 in 3 US college graduates work in jobs that do not require a degree.
  4. As people are moving jobs and careers more frequently, that means there is a demand for constant upscaling for employment opportunities.
  5. One third of global EdTech VC investment counts from 2015 to 2020 goes to seed funding. It is more difficult to raise series B & C as the EdTech startup must capture a medium-to-large user base with viable products & services. Only 7%  of the investment count was in series B and 3.5% in series C.
  6. In 2019 H2, the global education VCs were placing their bets into Talent/Work and STEM/Coding/Robotics category which takes up to 50% of the investment deals.

Challanges Faced by EdTech Sartup to Scale Up:

  1. Money (fundraising)
  2. Lack of EdTech ecosystem to support the fundraising and expansion. In order to build a strong EdTech network and ecosystem, there is a need for a long term view, an anchor player supported by government policy, education institution and stakeholder, EdTech accelerator, private sector, capital provider such as investors & banks.
  3. Psychological price of entrepreneurship founders have to pay. Only founders with psychological edge and grit will succeed.
  4. Fragmented market especially in Southeast Asia where language is a barrier of entry.
  5. Resistant from educators to learn and use new technological tools.
  6. Internet access in developing markets. Opportunities presented by COVID19 for reforming the education sector also exposes the population who don't have access to the internet as most schools are closed and classes moving online.

The Future of EdTech and Opportunities:

Education is no longer tied to a subject but to the 5Cs (Communication, Collaboration, Creativity, Critical Thinking, and Citizenship). EdTech startups that support product development in these areas will do well globally. Corporate training and Pre-K education is also expected to take a larger market share in the future. Emphasis will continue to be placed on retraining of the workforce, rather than firing. 

More global tech giant entering EdTech space Eg. In August 2019, Google launched plagiarism tools under their educational platform, Google classroom. They will be more tech giants ready to acquire smaller EdTech startups.

Learn More:


Written by Agustin, BLOCK71 Indonesia.