Tech in the classroom

There are just too many kids to educate using traditional teaching – which means there’s a major opportunity for online.

Online learning is far from mature and is only a tiny part of a potentially huge new sector called education technology.

Almost all of us have met online education in some form. It’s ubiquitous in the workplace, where many of us – often unwillingly – use it for various types of mandatory training. Some of us have enrolled in massive open online courses, or MOOCs, to learn new skills.

You may have come across online learning at universities, which now record most lectures so students can take in the material at their leisure. Schoolkids go online to gather information for projects; Google search and the cut-and-paste function make it far simpler than using a book.

That’s one way to look at online education – as a new technology that is rapidly growing and establishing a vital role for itself in learning.

But there’s another side to the story: that online learning is far from mature and is only a tiny part of a potentially huge new sector called education technology, or edtech, which is still in its infancy.

Currently in the education sector less than 3 per cent of spending globally goes to technology, according to HolonIQ, a global education intelligence firm. In other words, technology has a far smaller foothold in education than it does in other sectors such as finance, health or media. In the media industry, if you include content such as music, over one quarter of spending is going into technology.

Now comes the kicker. HolonIQ contends that conditions are now ripe for a massive expansion in edtech that is likely to change the face of education in the next 10 years.

It’s estimated that the world will have more than a billion more children of school age by 2030. These children will need not only schooling, but also post-school education, either at university or in vocational colleges.

“How the heck are they going to be educated within the current system? It’s not going to happen,” says Maria Spies, one of HolonIQ’s co-founders and managing directors. “There’s absolutely no hope of servicing that number of people in the current structure and therefore something’s got to crack.”

How can countries such as India, Indonesia, Nigeria and Brazil, where much of this growth is expected to be, accomplish this task? That’s where technology comes in. “The application of technology to education is really the only way all these people are going to be educated, and that has massive implications,” says Spies.

It also requires large amounts of money. Even though governments are unable to supply the capital, the funding is there. It will come from the market, says Patrick Brothers, HolonIQ’s other co-founder and managing director.

He points out that the other sectors in which technology has gained more of a foothold – finance, health and media – have successfully tapped private capital. Health is the closest analogy because, like education, it is also focused on delivering a personalised service whose outcomes are often not immediately quantifiable.

But there’s a stark difference between the amount invested by the market in health compared to education. In a global healthcare market worth $U10 trillion ($14 trillion), the global healthcare market capitalisation is $US5 trillion. But in a global education market worth $US5.5 trillion the market capitalisation is just $US150 billion, Brothers says.

“Why is education not accessing these trillions and trillions of dollars of private capital?” he asks.

But it’s starting to happen now through edtech. In 2018, $US8 billion of venture capital poured into education – twice as much as in each of the previous two biggest years, 2015 and 2017.

“We’ve seen a much more serious move by investors, entrepreneurs and institutions to explore, if not adopt aggressively, technology in education,” Brothers says. “We saw regular funding rounds of more than $US100 million in edtech, which was previously unheard of.”

In the past two years the number of education IPOs has grown dramatically (there were 17 last year) and there are now 10 edtech unicorns, or billion-dollar-plus companies.

There is an almost perfect match, Brothers contends, between the problems the education sector has – cost, poor access for students, lack of relevance to work – and the ability of technology, backed by private capital, to solve them.

“Technology for many other industries has reduced cost, it has increased access, it has improved speed, it has improved reach,” Brothers says, adding that the same is possible in education.

HolonIQ notes two other important things. One is that edtech is becoming highly diversified. Spies and Brothers have developed a taxonomy of education technology – a global learning landscape – which divides it into 10 main areas and 50 smaller clusters.

It’s no longer just about online courses. As well as covering the familiar knowledge and content applications, edtech also spans education management (including admissions and finance), new delivery models (apps and bootcamps), learning support (test preparation and after-school tutoring), assessment and verification (personalised learning portfolios and credentialling) and other areas such as talent acquisition, wellness, internships and mentoring.

The ever-expanding range of possible applications backs HolonIQ’s proposition that edtech will be transformative.