Future Of Edtech Start-ups Will Be Powered By a New Wave Of Innovations
The space is poised to become a $30-billion industry in the next 10 years supporting and complementing the conventional classroom teaching formats
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The education industry is the one that shapes the future of generations. It is poised to become a $7-trillion global industry by 2025. The disruption caused by the COVID-19 pandemic fueled the development of the edtech sector that uses information technology tools for inclusive, engaging, and personalized learning. India's edtech sector raised about $4 billion in private investment in the past five years. It is poised to become a $30-billion industry in the next 10 years supporting and complementing the conventional classroom teaching formats.
The edtech startup space in 2022
India's edtech, currently worth $6 billion, covers all spheres of learning in the B2C space, from K-12 to competitive exam space and further skilling and reskilling even beyond college. Rising demand from tier II and III cities will drive growth in the sector making it worth $10.4 billion by 2025. As per an industry estimate, there are over 4,450 edtech startups in India currently.
The return to normalcy post COVID-19 affected business models and profitability and funding plummeted. According to the 'Tracxn Geo Annual Report: India Tech 2022' analysis, the flow of funds fell by 39 per cent between January and November in 2022 compared with the last year in the same period.
Macroeconomic factors also affected the sector globally. However, the exciting debut of ChatGPT by OpenAI towards the end of the year has put the focus back into the leaps that education can take with the advent of Industry 4.0 technologies such as artificial intelligence. Technology will soon become an integral part of classrooms and new pathways will emerge in teaching and learning
In 2023, Indian edtech will have to rethink business models while keeping learners needs and business sustainability at the center.
Technologies that will drive innovation in 2023 in the learning space
Hyper-personalized learning: In 2023, hyper-personalized learning will help educators enhance their effectiveness in supporting their students. Artificial intelligence (AI) and machine learning (ML) will enable design and delivery of unique learning experience for each learner to address their individual areas of improvement and strengths. It will help them make targeted lesson plans, tests and learning content based on collective knowledge gaps for smaller groups of students instead of a generalized design and delivery of teaching.
Virtual reality (VR) and augmented reality (AR): A report by Market Research Future (MRFR) suggests a CAGR growth of 18.2 per cent when it comes to the use of AR and VR in the education market from the year 2022 to 2027. This opens up opportunities for young children to grasp complex concepts and gain hands-on learning experience in low-risk virtual settings. VR and AR will be contributing hugely to the edtech space in terms of sharing information in novel ways and engaging ways. Universities are already building their presence in the metaverse and may lead to a complete transformation of how one accesses these institutions to engage and learn in a virtual immersive environment.
Micro learning and nano learning: By breaking down subjects into topics, sub-topics and then further down to simplest fundamental concepts one can design micro-learning (3-5 minute explanations) and nano-learning (1-2 minute explanations) that are customized to the unique needs and contexts of learners. This kind of learning is provided to solve for immediate needs or to support reinforcement of concepts. Nano-learning can be powered by nano-testing to assess super narrow areas of strengths and weakness, by using AI and ML. It is the future of learning-on-the go.
Hybrid Learning: Hybrid learning model will combine in-person and online learning while making education more accessible. It will also help overcome the limits of peer-to-peer or informal learning, socialization and networking that pure-play remote format do not offer. Due to the flexibility it offers in comparison to remote learning; the hybrid model of learning will ensure a superior validation of the learning outcomes as well as credits and degrees earned.
Lessons for the sector
On a global stage, education still lags the investment and digital adaptation in comparison to other sectors. At the same time, a mere 4 per cent of overall expenditure in education is allocated to digital, presenting a serious challenge to the need for advanced technologies to be embedded in the education delivery and learning process. As per a report by Holon IQ, there will be 2 billion more school, college, university and alternative post-secondary graduates in the world. The knowledge economy and future skills will require massive digital transformation to cater to the requirement.
The sector must take note of the learnings of 2022 and consider the emerging trends to decide the path ahead.