How Edtech Startups are Booming in 2021

Tina Rosen, Education Technology Insights | Wednesday, February 03, 2021

The education industry is rising with progress lately.

FREMONT, CA: With the majority of businesses facing tough times by the wave of the Covid-19 pandemic, education tech startups have observed extraordinary growth and emerged as a hot sector for firms to invest in. Specifically, it has come out as the best sector for venture capital firms to invest in. A venture intelligence report said that education tech startups have collectively raised more than $795 million in H1 of 2020 in comparison with $108 million of last year.

Since most schools and other educators are partnering with online learning modules and integrating them in their core practices, the education tech companies are rising to prominence. The reason behind the education tech companies recording a 7X spike in fundraising is the maximum use and adoption of online learning as schools, and other education institutions are restricted to open. Other sectors, such as e-commerce, hospitality, travel, and more, remain affected by recording a dip in the deal sizes.

Top 10 EdTech Startups - 2019According to a story, startups have borne a huge brunt, experiencing by its drop-in deals falling by 31% to 272, from 393 deals during H1 of 2019. Also, capital raised by the startups collectively has fallen by 11 percent to $4.6 billion in 2020 till June last week from $4.6 billion from H1 of 2019. Overall, education tech startups have contributed around 20% of total venture capital investments in H1 2020.

Also, in H1 2020, education tech has been the second-most funded sector after financial tech and financial services, told by a research report. Most of the education tech companies in the education sector are raising a couple of hundreds of millions of funds from top investors in the world.

Education tech in H1 2020 has set vital trends that will define the industry and its progress. We see that online learning is making ground essentially beyond a large number of bigger and more significant economic and political projects. Not just in terms of user growth, this trend is also reflecting on Venture capital investment as well.  

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