Industry Spotlight: EdTech is the New FinTech

What is EdTech?

EdTech is an all-encompassing term for technology used for educational purposes. Some popular examples are SkillShare, Udemy, and Blackboard. EdTech can be used for hosting exams, tracking student progress, creating personalized learning plans through AI, and hosting courses.

The industry is expected to see incredible growth through 2027 with a CAGR of 18%, and is attracting the attention of investors. The rise in access to technology, and the rise in virtual or hybrid learning due to the pandemic has led to the proliferation of EdTech companies all over the globe. EdTech is growing at such a fast pace that some call it the new FinTech.

3 Trends to Know

Data-driven Teaching

EdTech companies that focus on the K-12 and college sectors in particular are able to collect huge amounts of student performance data like test scores, courses taken, and graduation rates. All of this data is being analyzed with the goal of creating a more personalized, student-centric teaching environment.

Classrooms can now move from the traditional, one-size-fits-all approach to a more customized approach that is more fit for students on an individual basis. Teachers can use this data to monitor each student’s performance in the classroom, and create learning plans tailored to the classes’ needs. Teachers are also relieved of a lot of administrative work, like grading or testing, which allows them to develop relationships with their students.

E-Learning

Companies like Coursera, SkillShare and Udemy are taking advantage of the uptick in the demand for on-demand or pre-recorded courses. They operate as two-sided platforms that satisfy the needs of students, who can learn about nearly any topic, and the instructor, who profits off of offering and marketing their classes through the platforms. This industry segment is expected to reach $375B worldwide by 2026.

Each of the previously mentioned companies fulfills a different segment of the learning market. Coursera partners with reputable universities, like Stanford, to offer online-only courses, SkillShare is focused more on hobby and creative-focused classes, and Udemy caters to professionals wanting to improve their job-specific skills.

E-learning is being adopted by over ¾ of US organizations and has added a whopping 42% to their bottom lines. When compared to traditional learning, e-learning takes much less time to complete, so companies can decrease their training time while maximizing results. About half of US companies have said that they plan to add EdTech to their L&D initiatives.

Immersive Learning

Immersive learning uses virtual reality or augmented reality and implements some element of gamification. The main goals are to eliminate distractions and hold students’ attention spans for longer. According to Accenture, these are the top 6 benefits of immersive learning:

1. Mirroring Real-Life Situations

2. End of Distance

3. Reduced Operational Costs

4. Learning Through Mistakes

5. Increased Engagement

6. Better Analytics

Immersive learning has many beneficial use cases. Corporations are expected to lead the charge in adoption in the coming years. Two great examples of success in the corporate world are WalMart’s use of immersive learning for retail training, which cut training time by 80%, and United Rentals’ outside sales reps reducing training time by 40%.

With ease of access to new skills and information, EdTech truly democratizes information. Personally, I am taking Udemy courses for new skills to keep myself sharp. EdTech is enabling people to become lifelong students.