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Shift Toward Virtual Learning Causing Edtech Market Boom

November 4, 2021

Edtech startups have seen $13.8 billion globally in investments throughout 2021, according to PitchBook data. The investment is already higher than the $13.7 billion funneled into edtech in all of 2020. This capital has also helped 14 new edtech companies achieve unicorn status, representing nearly half of 35 edtech unicorns.

The growing and maturing edtech industry encompasses technology that facilitates learning for kids and adults. The edtech industry is a diverse and rapidly growing market that is getting significant attention from industry veterans as well as generalist investors.

Edtech IPO surge 

One of the many impacts of the COVID-19 pandemic was the shift toward virtual learning. Increased adoption of online learning platforms led investors to realize that online learning will continue even as schools reopen and students return to the classroom. 

Edtech unicorns emerge

A highly anticipated IPO on the horizon is India’s Byju’s, an online learning platform that recently raised $300 million at a valuation of $18 billion. This year alone, Byju's acquired Singapore-headquartered Great Learning for $600 million, US-based Epic for $500 million, and India's Aakash Educational Services for about $1 billion.

The most recent additions to the unicorn club include Outschool and Masterclass. Outschool is currently in Series D funding and valued at $1.3 billion and Masterclass raised an additional $225 million in May 2021 at a reported valuation of $2.75 billion. The highest-valued new entry is Seoul-based Badanamu, which was valued at $10 billion.

Public market investors can see the long-term value in mission-driven, technology-powered education tools. These companies saw growth and evolution during the shift to remote learning and they will continue to evolve with the changing educational experience. 

2020 edtech unicorns and their valuation

Edtech mergers, acquisitions, and partnerships

On September 13, 2021, Anthology and Blackboard announced they will merge by the end of 2021. This mega company will serve more than 150 million users spread over 4,000 campuses in 90+ countries.

On October 26, 2021, Ellucian announced its expanded partnership with D2L. The organizations will extend their existing partnership, making it easier for colleges and universities to integrate their learning management system (LMS) and ERP or student information systems (SIS)

We are also seeing an expanded focus on virtual and in-person learning, otherwise known as blended or hybrid learning, through the new partnership between NetDragon and the Ministry of Education of the Republic of Ghana. This new relationship will develop a country-wide LMS and ensure inclusive and equitable education for all people in Ghana. 

What does G2 data tell us?

Online course providers, digital learning platforms, online learning platforms, and LMSs are some of the hottest tools in the education industry right now, as educational institutions look to adopt technology that will give them an edge in blended learning. 

Find the best Online Learning Platforms, here.

Just in G2’s Learning Management Systems category alone, we have seen shifts in category traffic showing steady interest early in the year, dropping as we got comfortable with blended learning, and then increasing again at the start of the school year in August 2021. This shows that even as schools reopen, these virtual tools will continue to be used within the education industry. 

percentage growth in traffic to G2's LMS category

Companies that are adopting these tools understand the importance of providing access to quality education resources. 

In G2’s Fall 2021 reports, reviewers gave learning management system products an average score of 83% for ease of setup and a score of 86% for ease of use. And overall, products in the Learning Management Systems category had a “likelihood to recommend” score of 86% on average, suggesting that users are finding value in these systems but there is room for improvement. 

The recent increase of education-related mergers and acquisitions, funding activity, and IPOs combined with the technology's demonstrated value, reveal a space primed for growth through the remaining months of 2021 and beyond. 

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