Edtech 2.0: Prioritise Purpose Over Ambition, Value Over Valuation And Impact Over Fame
The edtech sector holds a very special place in the Indian start-up ecosystem. The sector has grown exponentially between 2014 and 2022, with ventures in the space raising a staggering USD 7.37 billion over the period. Multiple edtech startups have broken into the coveted Unicorn Club, including six in just the last three years, thanks to increased adoption, growth in scale, and institutional funding, even as they increased access to education across all levels, from K12 and test preparation to online certification and skill development.
Finding a new vision: Why edtech founders must explore a different perspective to edtech
For all its achievements, however, the edtech growth story has hit a few bumps in recent months. Funding in the space has slowed down, largely due to a global funding winter, and many ventures are finding it hard to sustain their growth momentum as losses compound. But, in every cloud there is a silver lining – and the current slowdown is an opportunity by stakeholders in the space to take a deep breath, reevaluate ways in which to improve the ecosystem, and drive an evolution from the current paradigm to a Edtech 2.0 vision.
And this redefining should, ideally, begin with the founders and their mindsets.
The Makings of a Revolution: Three key shifts that will define India’s Edtech 2.0 transformation
Edtech 1.0 did a fantastic job. It focused on enabling access to education, and it did that for millions of people across India. However, the industry has reached a level where it should evolve beyond just enabling access to education. The need has been apparent for quite some time now, with questions now being asked if the efficacy and depth of learning delivered should be prioritized over its breadth because, now that the novelty of access has worn off, people want to see the results.
Edtech 2.0 must address this need by prioritizing improved effectiveness of learning outcomes. This means that, at the very least, products and business models should be structured differently, and that there should be a sector-wide movement beyond creating in-the-moment disruption to generating long-term, sustainable impact - and here is how these shifts will materise:
Ambition to purpose: Ideally, this transformation will begin by refocusing from ambition to purpose. Ambition has generated great dividends for Indian edtech startups. Some of the most valued edtech start-ups, at present, for instance, are homebrewed ventures. They have also driven significant innovation in the edtech space. However, certain inadvertent factors can impact the frequency, consistency, and depth in innovation. The best of innovations often come from purpose, from the necessity of creating a lasting impact. This means that, instead of focusing on winning at all costs, ventures and founders should explore how they can create long-term value for all stakeholders at all levels. In Edtech 2.0, the purpose is about creating real-world impact through education.
Take, for instance, the good work being done within localisation of learning. Many edtech companies adapt their entire learning library, including learning modules, in local languages for the geographies in which they operate. This is the standard operating model. Some value-focused ventures, however, differentiate themselves with how this learning is delivered. For instance, a significant percentage of students in India hail from low-income households with access to just a single device. Turning learning content into snackable modules, these players allowed users to continue their learning, even if they only had access to the device for 15 to 20 minutes during the day.
Valuation to value consciousness: The other shift must be from focusing only on valuation to being value conscious. Valuations are critical markers for startups, but they should not be the only driving force. Focusing purely on valuations can sometimes create tunnel vision with an obsession for achieving these numbers at all costs. Valuation needs to be steeped in values, and Edtech founders should ask themselves why they are doing what they are doing. How does their idea make a positive impact in people’s lives? How do they intend to run their business? What is their definition of success? What problem are they solving, and how are they improving lives? These questions are essential for edtech founders to identify the values that they stand for and identify how to create a sustainable and impactful business.
Fame to impact: The third element that balances ambition and valuations is impact. Fame is closely tied to success and wealth creation, but it's crucial to balance it with impact, which is grounded in making a tangible difference to people's lives. It brings in virtues like empathy, transparency, and grit, which set up the business for long-term success. More importantly, it secures buy-in from key stakeholders, from the talent needed to make this vision possible to the very users who will be impacted by the solutions and services on offer.
The key issue with Edtech 1.0 was that it focused on the product over the learner. This approach needs to change; the edtech industry needs to focus on how learners can apply their knowledge and skills practically to produce favorable outcomes and deliver results. To be able to do that, founders in the space must re-evaluate their priorities and realign their long-term and short-term goals. This shift in perspective is critical to creating a long-term and sustainable impact in the edtech industry and making the Edtech 2.0 vision a tangible reality.
