Online tutoring is luring huge attention from investors during COVID-19.
The COVID-19 outbreak has created a massive strain over the education system globally. Closure of schools, colleges and other learning spaces have impacted approximately 1.6 billion learners across more than 190 countries and all continents. This global crisis, in some way, has also aggravated pre-existing education inequalities by minimizing the opportunities for children, youth, and adults who were already left behind mainstream education in the pre-pandemic world. Undeniably, this will have a significant impact on the generation and future developments.
However, the crisis has also expedited education innovation than ever before. We are seeing rapid adoption of digital tools and services to keep the learning going amid the pandemic. As the governments across the world have temporarily closed education institutions in an attempt to contain the virus from spreading, schools and colleges are turning to advanced edtech solutions. This is why most investors are now pouring billions of dollars in this segment.
India-based online tutoring startup, BYJU’s, for instance, recently raised US$100 million, from Bond Capital. On the other side, the online learning platform Udemy secured US$50 million in February, reaching its total valuation to US$2 billion.
The Changing Face of Education
As the COVID-19 crisis continues expanding across countries, a large number of institutions and students have already shifted and are shifting to online learning. As this sudden shift away from the classroom in many parts of the globe is soaring, some are speculating whether this will continue to persist post-pandemic, and how such a shift would impact the global education market.
Already prior to COVID-19, there was high growth and adoption of education technology, with global edtech investments reaching US$18.66 billion in 2019. It was also expected that the overall online education market will reach US$350 Billion by 2025. During the time of crisis, the market is seeing massive uptake, from language apps to virtual tutoring and video conferencing tools to online learning software, there has been a significant surge in edtech.
Moving ahead, industry stakeholders are seeing huge opportunities for more sustainable and mature solutions in the global education system.
Looking at the Indian edtech scenario, a growing number of edtech startups are immensely attracting increased interest from investors. For instance, Toppr, one of the largest online learning startups in India, secured US$46 million in a new financing round to scale its platform, including a new product. Classplus, a mobile-first SaaS-based e-learning platform, received US$9 million in its Series A funding round, led by RTP Global, along with existing investors Blume Ventures, Sequoia Capital India’s Surge, Spiral Ventures, and Strive.
Vedantu, an interactive online tutoring platform, raised US$100 million in Series D financing round led by US-based investment firm Coatue Management, with existing investors including Tiger Global, GGV Capital, Omidyar and Westbridge Capital. With these growing investment trends, edtech startups are witnessing rapid growth.
Therefore, online education has seen a massive boost since the lockdown. Almost every other online platform has opened up its content for free making it accessible for all students. Even in a challenging environment, edtech is expected to remain a very hot sector of VC investment, according to KPMG.