Are Edtech Startups Making an Impact to the Education Sector of Our Country?
India is transforming and the major reason behind this transformation is because the way our country is leveraging the technology to re-create and revolutionalize different sectors. According to a Mckinsey report, newer digital tools like Cloud Computing, Advanced Genomics and many others could have a combined global economic impact of $550 billion to $1 Trillion a year by 2025.
Several tech startups in India are quietly changing the dynamics of the education landscape of our country. With our governments resilient push by increasing the digital reach to drive progress and economic growth our education sector is now ripe and ready. According to Edustars survey, 61% of the companies in India have built mobile and tablet apps in the education space. 54% of them leverage the cloud for their startups while 32% use video technology. A satisfactory 32% of the edtech startups present in India are earning between Rs. 5 lakhs to Rs. 1 Crore per year and 25% of the startups are earning over Rs. 1 Crore Per Annum.
Zishaan Hayath, Founder of Toppr, an online test preparation platform says that India’s Education sector is the next front that needs to be conquered using technology. He adds that via technology their platform is able to adapt question papers to a personal level. This way they can figure out the weaknesses of a student based on past performance and serve him or her appropriate content and questions.
Videos have always been the most engaging form of content on the internet space. Most of these edtech startups use technology to compress data so that video streaming or pre-recorded video content can be sent over even at the speed of a 2G Connection. The segment that has most players involved in the edtech space is the Online Test Preparation. The entrance exams like IIT, IIM, UPSC or Bank Exams are the focus of many edtech startups.
Karan Mohla from IDG Ventures, an investor in a startup called SuperProfs and also one of the business mentors, says that due to startups like SuperProfs a student is not constrained to major hubs of IIT and IIM Coaching. SuperProfs have tied up with 200 Professors across the country to upload their video lectures. Students post lectures can also get their doubts cleared by booking a slot for a live online session with professors. They ensure to bring the best of the teaching talents from cities like Kota, Chennai, Delhi, Bengaluru, etc.
Vedantu is another growing edtech startup of India, which is disrupting the online tutoring market. Vedantu works as an online marketplace where students and teachers can meet and select one another. They charge Rs. 150 to 250 per hour for coaching students from 6th to 12th standard. Students can rate teachers, which is visible to the new students to make an informed choice. Although, we feel that Online Education is still in its initial phase, but we see a much larger number of investors, which is total 60 being drawn to edtech space in India than in the same time in 2014, which was 35. Even globally, as the data from VC investment tracking firm CB Insights suggests that there is a phenomenal 71% increase in the investments to ed tech space from the year 2013 to 2014. Financing grew from $944 million in 2013 to $1.6 billion in 2014.
There is a definite traction for ed tech products in the market, but edtech startups are facing several problems as well. As per the Edustars Survey, when startups were asked about the challenges faced by them, 50% of the startups said elongated sales cycle as their biggest problem. With 39% stating their biggest issue was user adoption. Lack of awareness was the problem with 32% of the startups. While the rest pointed out at several issues like unable to attract talented employees, raising funds and difficulty running a for-profit model in the education space.
The majority of startups in India from edtech space are in early stages, but fortunately, most of them are reporting sizable traction, but the overall scenario is positive and both investors and entrepreneurs seem to be thrilled about the potential of the sector.