Exploring the Edtech Ecosystem

New platform allows for detailed look across European sector.

GUEST COLUMN | by Hege Tollerud

A brand new open-access edtech platform, powered by Dealroom in partnership with Brighteye Ventures, the European edtech-focused venture capital fund, is set to be the new home of edtech innovation intelligence: https://edtech.dealroom.co/intro 

‘Education is a $7 trillion industry. And whilst about 50% of education time is digital, only 4% of global education spend is digital, making it one of the world’s largest market opportunities yet to be digitized.’

The edtech ecosystem database is designed to be an ideal tool to inform and foster engagement between startups, investors, ecosystem builders and other parts of the edtech ecosystem. Brighteye’s sector expertise has enabled the creation of a new taxonomy, aimed to map how edtech companies are organized, offering a new framework for the edtech ecosystem.

Across the Ecosystem

Entrepreneurs can add or claim their company profile to their database for free, search the most active investors in the sector, and compare themselves against direct and indirect competitors.

Startup teams can find talent.

Investors can keep track of investment trends and emerging niches and discover promising startups and scaleups.

And policymakers can keep abreast of the latest innovations occurring across sector, both in terms of product category and target customer groups.

The platform catalogues 25,000+ startups, and 13,000 funding rounds, providing global intelligence and trusted insights into edtech startups and scaleups, investors and beyond, across the edtech ecosystem.

For What It’s Worth

Education is a $7 trillion industry. And whilst about 50% of education time is digital, only 4% of global education spend is digital, making it one of the world’s largest market opportunities yet to be digitized, with the gap presenting an opportunity worth over $2.7T.

2020 proved to be the pivotal point for the edtech sector, with the impacts of the pandemic disrupting how millions of students and educators delivered and accessed education, as traditional educational institutions were forced to shift to digital learning overnight. 

On the investment side there has also been a massive increase in money going in. So far in 2021 the global VC investment into edtech startups has reached $18B, up from $5.4B five years ago.

European edtech investment is amongst the fastest growing investment categories in the world, reaching $1.9B so far in 2021, more than a 2x increase compared the $711M raised in 2020. If we see a similar end to the year in 2021 as we did in 2020, then we could expect levels to triple. The $1.9B running total represents 26X growth in investment since 2014.

Deals, Growth, and Predictions

It is however interesting that the number of deals in Europe has remained more or less the same from 2020 to 2021. By November 2021, the investments had been raised across 222 transactions – which means we can expect to see a similar total deal count in 2021 compared to 2020, where the total number ended at 237. This shows that those who get funding are raising bigger rounds rather than more companies attracting investors. On average, in the first half of 2021, European deal sizes were three times higher than 2020 levels, up from $3M to $9.4M.

We believe this growth is due to three main factors: (1) significant growth during the pandemic fuelling higher valuations, (2) increasing involvement of US- and Europe-based generalist funds and private equity and (3) the expectation that remote working and learning will continue post-pandemic to a greater extent than first expected.

There are now 33 edtech unicorns around the world, and more than 23 of these have been minted since March 2020 when the pandemic began. The first European unicorn was GoStudent, but a number of others are on the march. We have been delighted to see 9 $50M+ rounds thus far in 2021, across 6 different European markets including GoStudent, OpenClassrooms, Lingoda, Labster, Eloomi, StuDocu, Coachub, Multiverse and a member of our Brighteye family, ornikar.

This text is mainly based on information from the Brighteye European Edtech Funding reports published this year, and as the end of the year is fast approaching, we are preparing our 2021 update and 2022 predictions, due for publication in late January. You can find the full update from the first half of 2021 here!  

Hege Tollerud is Head of Community at Brighteye Ventures, a leading edtech-focused venture capital fund in Europe, leveraging deep experience and relationships in tech, education, media and VC. Connect through LinkedIn

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