Bittersweet Realizations In A Record Year For EdTech Funding

"Money Money Money" by Pat Guiney

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It is not quite over yet, but CB Insights can already assert that funding for EdTech activities boomed in 2017. The final result is a rebound of previous quarters, which went in track towards a yearly decline. But in the end, the money EdTech companies will have received near $3 billion dollars in 506 deals. It will surpass 2016’s $2.3 billion and 434 deals, but will fall short of 2015’s records.

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It seems that EdTech is becoming a fashionable investment at last. A little over a year ago, experts were declaring how “EdTech is the new fintech.” An unfortunate comparison in two ways. Today, the comparative advantages of promising startups that would revolutionize payments, credit, insurance, and even real estate turned out to be easy prey for the dominant institutional players. The simile turned out to be less flattering that expected. Conversely, the attention for the new ideas in the space seems to be following the hype more than a sensible and innovative approach to solve one of the many enduring challenges in learning.

As CB Insights reports, the startup raising the most funds is EverFi, a “digital learning platform for K-12 schools, universities, corporations, sports leagues, and non-profits.” But a quick look at their features makes it difficult to tell it apart from any available LMS, other than its focus on financial education. While the industry tries to figure out what EverFi’s does that would provide long-term value, Bono along with other celebrity investors have secured $190 million USD for the company, in the largest financing round for an EdTech company this year.

$190 million, however, is small in comparison to the darlings of the year before: TutorGroup, HotChalk and Pluralsight, winners of more than $200 million each in a downturn year. All of them online learning platforms, none of which took the EdTech industry to meaningful new ground to date.

Lingel LearningThis Moodle Community related post is made possible by: Lingel Learning, where learning begins. We are dedicated to developing creative eLearning and LMS hosting solutions. Click here to learn more.


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