India is behind China and USA when it comes to EdTech companies and funding. With populations of around 1.4 billion each, and rising middle classes and hundreds of millions of learners with insufficient access to offline education, China and India now house 9 out of the 10 major global EdTech unicorns. In 2018, they represented together more than 70% of global EdTech venture capital investment.
The world economy is estimated to more than double in size by 2050. Far outpacing population growth, this is primarily due to accelerating technology-driven growth. Emerging markets are expected to grow around twice as fast as advanced economies and, as a result, the largest economies in the world are projected to be China, topping the list, with India second and the US claiming the third spot.
According to DataLabs by Inc42, there were 3,500 EdTech startups in India in 2018. Between 2014 and 2019, a total of USD 1.802 billion was raised by EdTech startups across 303 deals. According to a report by KPMG, the Indian EdTech segment is expected to be a USD 1.96 billion market by 2021.
It is worth mentioning that Byju’s, founded in India back in 2011 by founders Byju and Divya Gokulnath, is right now the world’s most valued EdTech company, with a valuation of USD 8 billion. In January 2020 Tiger Global, one of the most influential investors in the Indian startup ecosystem invested USD 200 million in the K12 learning app. Byju’s has raised a total of USD 1.2 billion according to data collected by Crunchbase.
The Company is the only profitable consumer internet unicorn to have emerged from India. It is likely to raise further funding of USD 1 billion through the course of this year and is in talks with multiple investors, reported ET Rise.
Byju’s, which launched the learning app in 2015, claims to have garnered 42 million registered users and 3 million paid subscribers from both rural and urban areas. The average number of minutes a student spends on the app has increased from 64 to 71 per day over the last year and the annual renewal rates are about 85%, the company said.
Last week another Indian EdTech startup called InterviewBit raised USD 20 million in one of the largest Series A financing rounds in the Indian education sector, via Sequoia India and Tiger Global.
InterviewBit runs an advanced online computer science program for college graduates and young professional engineers. Doubtnut was the second Indian EdTech startup to receive funding last week. The startup nabbed USD 15 million from Tencent. The multilingual online learning platform has secured a total of USD 20 million with an MAU of 13 million.
Although the Indian EdTech sector has started off well in 2020, we believe that it won’t be able to overtake China anytime soon.
In 2018, Chinese startups received over 50% of all the capital invested by venture capitalists in EdTechs worldwide. Chinese EdTech companies received more money than the total amount invested in EdTech firms from all other countries combined, according to a study released by HolonIQ earlier this year.
The education venturing arm of global education provider Navitas, Navita Ventures, released a study on global EdTech ecosystems last year. The study concluded that Beijing is the world’s hub for EdTech because the highest number of EdTech companies are headquartered in the city. Even though the Chinese capital is home to over 20 million people, Beijing has the highest concentration of EdTech companies per capita globally, at 120 EdTech companies per million people, followed by New York with 117, the Bay Area with 91 and Bangalore with 77.
Clearly education technology is becoming a global phenomenon. A report by EdTechXGlobal in 2016 said that the EdTech market is projected to grow at 17% per annum, to USD 252 billion by 2020. The US has set the trend and pace of the EdTech market. Asia is now experiencing the world’s fastest growth in investment into the sector and Europe has also seen increases; however, this region remains highly underinvested and a fragmented market.