Want to know what 10 of the big EdTech investors, like Bill Gates and others, have to say about EdTech? Keep reading to hear the opinions of these big-time EdTech investors. We got this EdTech 101 article from CB Insights.
10 EdTech investors and executives weigh in on the challenges and opportunity in ed tech, which may be poised to spawn new multi-billion dollar companies.
EdTech startups have attracted well over 1,600 equity deals in aggregate over the past five years, but education involves a far wider range of players than just VCs, corporate venture capital groups, and founders. We aggregated recent quotes on ed tech from prominent EdTech investors, and found several common themes, including:
- Long investment timelines — education is not typically a quick exit
- Technology as supplement rather than replacement — ed tech can magnify teachers’ impact, but not supplant it
- The importance of considering public sector interests, such as school districts and local governments
Scroll down to read investors’ thoughts.
1. David Levin, CEO of McGraw-Hill Education
Levin argues that ed tech initiatives must go beyond moving physical content online. Also, technology can lower textbook costs. McGraw-Hill has made several ed tech acquisitions and investments over the past five years (including HotChalk, a learning management system that is the second most well-funded ed tech startup).
“Merely moving content from the print world to the digital ecosystem won’t make a difference on its own. But by combining digital content with software that harnesses the science of learning — essentially, how the mind masters new concepts — we can work with faculty to create experiences that make learning more effective and efficient. These types of technologies go far beyond what’s offered in an e-book, making learning entirely richer and more personalized. While it seems like this package would come at great expense, it’s actually available today for roughly half the price of print.”
2. Stacey Childress, CEO of NewSchools Venture Fund
Childress argues that entrepreneurs too often fail to meet the real needs of teachers and students. She and NewSchools Venture Fund — whose recent EdTech investments includeEllevation Education, BetterLesson, and CodeHS — look for companies that have sought teacher input, or have teacher founders. NewSchools Venture Fund ranks first on our most active ed tech investors list with dozens of investments.
“Even with the real explosion over the last few years in innovation and capital going to edtech, there are still some gaps in market segments where we’re not seeing vibrancy … Some of the most promising, exciting companies have a teacher on the founding team—that’s a signal to us for sure.”
3. Rick Segal and Matt Greenfield, co-founders and managing partners of Rethink Education
Segal and Greenfield assert that ed tech players should work with established institutions (instead of dismissing school districts as possible customers) and align with pedagogical research rather than chase tech trends. With investments in companies like BrightBytes andGeneral Assembly, Rethink Education is on our most active ed tech investors list.
“We realized that many venture capitalists were approaching education technology companies in a peculiar manner. Many investors were unconcerned about the research on how people learn. Some invested in hot companies without ever talking to a single customer. Many believed that the only education businesses worth funding were those that targeted consumers. And they were convinced that school districts in particular made terrible customers. Having invested in two companies (Wireless Generation and SchoolNet) that sold to school districts, we felt differently.”
4. Steve Case, co-founder of AOL and chairman and CEO of Revolution
Steve Case believes education is among the next set of industries ripe for disruption. However, unlike consumer mobile startups, ed tech companies need to focus on building relationships with schools and governments to gain traction and understand needs on the ground.
“The first wave of the internet, which was building on-ramps to the internet and convincing people to get connected, required partnerships. We had hundreds of them with software companies, hardware companies and media companies. The second wave, the real successful companies didn’t need partnerships.
In the third wave, the sectors that are going to get disrupted are where partnerships with incumbent organizations like hospitals and universities are important to get significant market adoption. It’s not just about the app on your phone.