Is EdTech a Good Bet for Venture Capital?

Question

So, I've been messing around in EdTech for like 3 years now, both as a user and as a startup founder.Using MOOCs and CBCs, I've seen how they can cut the cost of sharing educational stuff big time. But that doesn't mean people are actually learning more because of it.I get that it's not a simple issue. There's a ton of factors in the mix. But I haven't seen an education company yet that's really blown up in size while actually making good on its promise to help students learn.Take Duolingo for example. I think they cracked the code on the whole lack of motivation and discipline thing for some users, thanks to gamification. But just because you've got a "streak" going doesn't mean you're actually learning anything.So yeah, just throwing some thoughts out there. I'm really into the whole education space and I've still got a lot to learn. But it makes me wonder: should EdTech even be trying to shoot for Unicorn status?

kdotca · Accepted Answer

What's the point of shooting for unicorn status?

endisneigh · Answer

nope - too political. it's worth doing, but not "a good bet for venture capital"

twunde · Answer

There is opportunity in edtech, but it's much harder to find viable business models that have VC-worthy returns than in most other verticals. Most edtech companies are either B2C or are selling to school districts or universities. Selling to school districts has unique changes due to school boards and often grant-based funding models. This makes getting initial traction and scaling up more difficult. If you look at successful companies in the space like teachers pay teachers, or clever you'll see that many have relatively small amounts of funding and have been around for more than a decade in order to get acquired.

krishadi · Answer

I can't speak for VC, but, the way we look at education itself needs to change. The current system was built for a post war industrialisation era. I am not saying that it is right or wrong, but bringing in new technology to a system that was built for a different time and society is perhaps not ideal. I think the biggest EdTech out there is YouTube. I've built out a career from the content there is in YouTube. The content itself isn't pay walled, there is enough incentive for content creation and there isn't a single structure that decides what you should do or learn next. All of this is up to the user.
It could also be argued that content itself is educative to prompt the user to think, and act on what to do next. But, I am not sure how disconnected is that process from the recommendation algorithms.
Well, the food for thought is, perhaps what we need from Edtech is not to solve the problems of the past generations, but to change the way we educate ourselves.