The pandemic has made us realize the importance of the Ed-tech sector. When the whole was locked down, the ed-tech sector allowed each one of us to continue our education with the mere requirement of a mobile device and internet.
Year 2020 was the golden year for the Ed-tech sector, it has proved to be a catalyst in the growth. Indian Ed-tech startups have seen a total investment of $2.22 billion in 2020 as compared to $553 million in 2019, according to Indian Private Equity and Venture Capital Association (IVCA) and PGA Labs data.
The Rise of Edtech Sector
India has around 3500 EdTech startups. This sector has seen the majority of its growth in the last 5 years. In the last 5 years, Indian online education platforms have raised around $4 billion. A report by KPMG’s Online education in India: 2021 says that by 2021, the industry could be worth $1.96 Billion.
Top 3 Factors responsible for the growth -
1. Increase in Mobile Devices and Internet Penetration - Only 2 things are needed for online education i.e., internet and mobile device. With the increase in the number of both these requirements, the user base for online education will continue to rise.
2. The Shift from the old pedagogy of teaching - In the ed-tech sectors, the teachers are using videos and animations for more clearing the concepts. These new methods of illustration are more effective and being loved by the students and parents.
3. Personalized education - The biggest flow in traditional education is its teaching style of one fit for all students. With the rise of technology and the latest tools, the ed-tech startups offer personal attention, and progress tracking to each student.
The Market Leaders of Edtech Sector
The biggest player in the Ed-tech sector in India, are Byju, Unacademy, and Vedantu. Byju’s had become a talk of the startup world in the year 2020, it has shown the immense potential it carries. Byju’s have become the mammoth for the Edtech sector of the world. In the year 2020 itself, Byju’s have became a Unicorn. With the acquisition of White Hat Jr., it has become the world’s highest-valued Edtech Company. Byju’s have clocked a revenue of INR 2800 Cr in the FY20, compared to a revenue of INR 1,341 Cr in revenues in FY19, which is more than 2X growth. Following Byju’s, Unacademy is growing with the lighting speed. In the year 2020, its revenue has grown 4X. In the year 2020, it has clocked the revenue of INR 86 Cr compared to INR 21.8 Cr in FY2019.
Future of Edtech Sector
The edtech market is estimated to grow 3.7x in the next five years, from $2.8 Bn (2020) to $10.4 Bn (2025), at 14% CAGR over
FY20-25. It is expected to reach a user base of more than 37 Mn paid users by 2025.
The future of Indian edtech startups is really bright. The global investors are already eyeing this sector to tap its potential, which is being evident from the increase in investments recently.
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