The rise of Internet and of mobile apps gave birth to a new economy, based on technologies dedicated to knowledge and transmission, called “EdTechs”. First used in 2010 in the USA in the writings of American researchers, this designation covers a whole range of actors offering virtual classes, interactive preparations for exams, and solutions for learning foreign languages or even educational tutoring and counseling.
The tools developed are intended for educational staff, in private or public education, or directly for the general public, and are built on three distinctive segments: school education from kindergarten to high school, higher education and executive education. Whichever for, market access is complex as users are rarely the buyers…
Now, will the sanitary lockdown and the roll-out of remote teaching change the rules of the game in the long run for such business trades?
A global dynamic
According to the annual report of Educapital, a specialized investment fund, 7M of dollars are said to have been invested in 2019 in EdTechs worldwide.
Two thirds of the world's market are concentrated in China and in the USA, with 2.4M of dollars for China, and 2.3M of dollars for the USA. Europe, who was up until now playing Tom Thumb with 450M of Euros in 2017 and 763M in 2018, is steadily growing. In 2019, Europe was for the first time above the symbolic threshold of a billion invested, pulled up by the French, British and Scandinavian investments.
Yet, strategies differ widely from one country to the next. For instance, in China, 64% of investments are focused on the school education segment as parents are used to pay for the future success of their children, whereas in France, this segment is hardly monetizing such offers. If the total amount of funds raised doubled in a year with 11M of Euros on average in 2019, the market remains modest.
A French market still shy
In France, the EdTech sector accounts for 300 to 400 companies…This number varies depending on the number of business creations. Some of them have made quite a name for themselves, and most famously, the online training platforms Openclassroom, Digischool for young students between 15 and 25 years old, or the online teachers' community Superprofs. However, the great majority of them are start-ups of less than 10 employees which struggle to find their business model.
Despite the “technoskeptics”, analysts note several positive factors.
- First of all, since 2013, the government showed signs of encouragement.
The 2017 Digital Education Plan anticipated that 50% of public institutions would be equipped with tablets or computers. Even though the “results of its implementation are disappointing”, according to a report from the Cour des comptes, its political support is a strong signal nonetheless.
- Secondly, the sector in France is actually federating.
In May 2018, the association EdTech France intended to promote France as the “the EdTech Nation”. In 2020, EdTechFrance is a recognized voice with now 250 members and two regional clusters around Paris and Lyon.
- Thirdly, as additional proof of the rise of this market, dedicated investment funds have been developed.
- Fourthly, the French ecosystem is indeed present in showrooms and international fairs.
The biggest fairs dedicated to digital technologies now include more and more French EdTechs (the Las Vegas CES, or the Paris' Vivatech), and they occupy a prominent place in the dedicated fairs (London's BETT, the EdtechXEurope, or again the Qatari's WISE whose regional edition was held in Paris in 2019).
- Lastly, to be ready for the future, specialized accelerators have seen the light of day everywhere in France, often as guest institutions within business schools:
Lockdown is no blessing and no curse
Not all EdTechs will live up to expectations because of the school lockdown. The branch is actually made of start-ups with very heterogeneous situations.
For some of them, the current crisis consecrates years of experimentation in a life-size test. For instance, Lalilo, a platform for school children, announced that 10% of elementary school teachers registered in 4 days (14,000 out of 135,000).
French school children are said to do more than one million of exercises on Lalilo daily, versus 20,000 ordinarily. Identically, other EdTechs were pushed into the limelight and took this opportunity to make a name for themselves. Their solidarity offers can be accessed for free, and were relayed very officially by a news letter from the Ministry of Labor.
However, others are affected by the lockdown, in France as elsewhere. In April 2020, BrightEye Ventures, issued the results of a pole carried out on EdTech entrepreneurs, for the most part European ones. Results show that the current crisis is no eldorado for EdTech actors. For instance, for SMEs and VSEs, 43% of respondents said they were experiencing customer loss.
So once lockdown is over, will EdTechs have cemented or lost their position?
What scenario for which final casting?
Worst case scenario for EdTechs would be a sudden stop occurring as soon as schools reopen on May 11th, 2020. Often criticized for their propensity to replace humans with screens, EdTech solutions may very well be sacrificed on the altar of human values of the “world after”.
There still wouldn't be any smartphones in schools and no schools in our smartphones any more. Ironically, the generosity EdTechs demonstrated by giving free access to their commodities would only have served to underline the lack of autonomy of the various learners and inequalities of digilliteracy.
To the contrary, the best case scenario would maintain a certain volume of remote teaching, supported by the parental tolerance regarding the use of screens.
Teachers, in the same manner Michel Serres did, would apply the “presumption of competence” to a generation of Thumbelinas, eager to complete face-to-face classes with digital commodities (BRNE). And the government would direct PIA investments towards EdTechs.
A third voice is being heard to build a learning society placing collaboration and digital culture at the center of school teachings. The key role of young EdTechs may lie precisely there: neither against, nor side by side, but truly within schools, schools which are at the heart of society, all throughout man's life.
Whatever the outcome, French actors all agree on one thing, that they should seek the protection of the educational sovereignty against GAFAM's insatiable hunger.