Dr Apoorva Ranjan Sharma is a seasoned veteran in the startup sector and a serial investor. He is a seasoned veteran in the startup sector and a serial Investor. Dr Apoorva is a globally acclaimed angel Investor, speaker and previously been a speaker at RISE Conference Hong Kong, Web Summit Lisbon, TiE Global SF and many more. He is also co-founder & President of Venture Catalysts – Asia’ first integrated incubator and No. 1 Early Stage Investor in 2017, 2018 & 2019, and globally 7th largest as rated by Crunchbase. He is one of the most iconic figures in India to foster the development of startup ecosystems across Tier 2 and 3 cities in India as featured by Forbes magazine.
The rise of EdTech startups is a phenomenon that is panning out across the globe, and the Indian developments in the sector are no exception. Ranging from partnerships with high-ranking global universities for online-MBAs, to standardized, high-quality video tutorials for school education, there hasn’t been a better array of unique offerings to the Indian consumer such as in current times. The international market is estimated to reach $252 billion by the end of 2020, and with EdTech being observed as one of the fastest-growing segments within the Indian economy, it is no surprise that it is eliciting interest from several VCs.
In addition to this, the ongoing health emergency has transformed the landscape immensely. As an unintended consequence, we now have witnessed an increased demand for EdTech solutions among schools and other educational institutes. They are hastily adapting to e-learning methods to finish curriculums and make up for the lost time. As social distancing becomes the new norm, such learning alternatives might be mainstreamed indefinitely.
Subsequently, firms are EdTech firms have been registering double and triple-digit growth rates alongside a surge in millions of online registration of students. This rise in demand for EdTech makes it a very profitable sector for VC investors if the 2018 and 2019 numbers are any indicator. EdTech startups raised $1.1 billion in funding during this period, which is only going to grow multifold in the years to come. Some of the biggest funding rounds of 2020 were bagged by Byju’s and Unacademy worth $400 million and $100 million respectively. Unsurprisingly, more than 14 startups in the EdTech space have secured funding since March 2020.
VCs are keen on maximizing opportunities that might arise from the current crisis as they believe that those who discredited the benefits of digital learning might finally see the potential in the upcoming years. The expectation is that people will appreciate newer means to manage their time while gaining skills, expertise and knowledge remotely. On the technology side, several advancements and disruptive innovations by startups are helping governments and educationalists reimagine their policy approaches towards developing education in the country. These startups leverage cutting-edge technologies like artificial intelligence and data analytics to provide a personalized, engaging learning experience to users. VCs now argue that this is equivalent to the smartphone revolution taking place currently in India. The smartphones helped the average Indian leapfrog the desktop computer phenomena, right into accessing high-speed internet on their sleek mini-computer like mobile devices. No one had foreseen the enormous and sweeping changes brought in by inexpensive smartphones to the financial inclusion agenda of the country. It resulted in the expansion of e-payment platforms and provided accessibility and a basic understanding of operating digital payments.
Similarly, EdTech startups could bring a seismic shift in filling gaps in the underprivileged education space by lending their support to those who cannot afford to pay gargantuan amounts for regular schools or online education. Assistance by EdTech companies can provide a much-needed head-start, and it could be done through a specific rural education focus, giving India an opportunity to accelerate transformation through new-age solutions for pre-existing challenges. Quite a few platforms that offer free access already exist, with such services offered to students from low-income families. Such initiatives help companies attain new customers and achieve sustainable growth, factors which VCs consider when making investments. The changes have the potential to be revolutionary; however, there is a long way to go as India continues to battle this challenge with millions not having seen even the insides of a classroom.
Noticing the potential mentioned above, EdTech companies have begun to expand beyond the big cities of the country. As we speak, they are foraying into tier-II, tier-III and even tier-IV cities. Additionally, they must work to improve digital literacy as it remains unaddressed. It is essential for EdTech service providers to ensure quality and nuance when serving those with an inadequate understanding of digital platforms. However, if all actions manifest smoothly and VCs play their cards right, people from diverse backgrounds can avail the opportunity to become digitally literate and before long, India’s digital divide shall be bridged.