Top edtech trends, companies and VC deals

The pandemic changed the way we do things—from how we work together to how we get groceries. Some of that change may be temporary, but much of it will likely endure. School shut downs challenged conventional thinking, too—with distance learning and the implementation of various remote and hybrid approaches to teaching, the classroom status quo got kicked to the curb amid COVID-19. Shifts in our collective approach to education, from kindergarten through college, created new opportunities for edtech startups and investors.

What is edtech?

Edtech, or educational technology, is an industry vertical referring to companies that develop software and hardware solutions to enhance teaching practices and improve learning outcomes. The tools coming out of this sector were vital in recent years, when virtual and hybrid learning options became instrumental as a way for students and teachers to connect. And the boom hasn’t waned now that many schools and universities are meeting in person again.

Opportunities in edtech

During the first 10 months of 2021, investors funneled $13.8 billion into edtech startups. That impressive dollar figure surpassed edtech’s global venture funding for all of 2020, according to PitchBook data. As of mid-December 2021, $15.73 billion has been invested into edtech startups across 1,229 deals.

 

What’s driving growth in edtech?

In 2020, PitchBook analysts looked at edtech industry growth drivers—both related and unrelated to the pandemic. Those growth drivers included:
 

• Repositioning edtech as a supplement, not a replacement
• Swelling demand for personalized instruction 
• The need to appeal to a younger, tech-savvy generation 
• A greater premium on reskilling and upskilling opportunities 
• More focus on soft skills
• The ballooning cost of college and pursuing higher education
• Evolving priorities and access in Asia

Top 5 edtech companies by capital raised*

*According to PitchBook as of December 15, 2021; data is subject to change frequently

SenseTime

• HQ: Shanghai, China 
• Total raised: $4.17B
• Latest deal type: IPO

SenseTime is a software company working to advance AI research, developing scalable and affordable AI software platforms that benefit businesses, people and society. It was founded in 2014 and is headquartered in Shanghai.

Yuanfudao

• HQ: Beijing, China
• Total raised: $4.04B
• Latest deal type: Later-stage VC

Founded in 2012, Yuanfudao is a privately-held, Beijing-based educational platform providing online tutoring services for Chinese students. The company's one-stop online tutoring platform provides elementary through high school students with various lessons that cover a wide array of subjects, enabling students to discover their learning weaknesses and conduct targeted learning by leveraging big data analysis.

BYJU’s

• HQ: Bengaluru, India
• Total raised: $.3.82B
• Latest deal type: Series F

BYJU’s is the developer of an online learning platform intended to deliver high-quality, engaging and accessible education. Founded in 2011, BYJU’s makes use of original content, watch-and-learn videos, rich animations and interactive simulations to make learning contextual, visual and practical. It is based in Bengaluru, Karnataka.

Zuoyebang

• HQ: Beijing, China
• Total raised: $3.44B
• Latest deal type: Series E1

Zuoyebang was founded in 2015 and provides web and mobile learning platforms to assist K-12 students. The company's platform enables students to seek answers, get assistance with their homework, and access teacher live streaming lessons and homework evaluation. It is based in Beijing, China.

PowerSchool Group

• HQ: Folsom, CA
• Total raised: $2.46B
• Latest deal type: IPO

PowerSchool Holdings Inc. was founded in 1997. It provides cloud-based software to the K-12 education market. Its technology helps schools and districts efficiently manage state reporting and related compliance, special education, finance, HR, talent, registration, attendance, funding, learning, instruction, grading, college and career readiness, assessments, and analytics in one place. It is based in Folsom, CA.

Top 5 VC edtech deals by deal size (2020-present)*

*According to PitchBook as of December 15, 2021; data is subject to change frequently

BYJU’s

• Latest deal size: $1.7B
• Latest financing date: December 2020
• Number of investors in latest financing round: 33

We covered BYJU in the previous section, but the startup raised $1.7B of Series F venture funding in December 2021 in a deal led by B Capital Group, XN, Oxshott Capital Partners and Baron Funds. 

Zuoyebang

• Latest deal size: $1.6B
• Latest financing date: December 2020
• Number of investors in latest financing round: 5

We covered Zuoyebang in the section above, but the startup raised $1.6B in a Series E1 funding at the end of December 2020 in a deal led by Alibaba Group, FountainVest Partners, Ontario Teachers' Pension Plan, Qatar Investment Authority and Coatue Management. 

Articulate 

• Latest deal size: $1.5B
• Latest financing date: July 2021
• Number of investors in latest financing round: 4

Articulate develops e-learning software that allows users to create e-learning courses for their learning management systems. Articulate raised $1.5B of Series A venture funding in July 2021 in a deal led by Blackstone, General Atlantic, ICONIQ Capital, LionTree Partners, and angel investor Brad Garlinghouse.

Eruditus Executive Education

• Latest deal size: $650M
• Latest financing date: August 2021
• Number of investors in latest financing round: 3

Eruditus Executive Education provides executive education programs targeting mid-career professionals. The Mumbai-based company's portfolio of programs is designed and conducted in alliance with leading business schools throughout the globe and delivered in a range of formats to help individuals grow in their careers. It’s most recent August 2021 Series E funding, Eruditus raised $650M from Accel, Canada Pension Plan Investment Board, SoftBank Investment Advisers, Chan Zuckerberg Initiative and Leeds Illuminate.

Nearpod

• Latest deal size: $650M
• Latest financing date: February 2021
• Number of investors in latest financing round: 1

Nearpod provides an online learning platform designed to empower educators to create learning experiences that engage students. The company's platform provides interactive educational content across mobile devices and assists teachers in giving real-time feedback on student performance. Renaissance Learning acquired Nearpod in February 2021 for $650 million.

More on edtech

Who’s investing in edtech?
Read our recent blog post highlighting the most active investors in education technology

Edtech company IPOs were practically nonexistent before 2021
Check out our news article about how edtech backers were rewarded this year as the IPO pipeline got hot

Was Coursera’s debut on NYSE a bellwether for edtech? 
Read our news coverage of Coursera’s IPO in Q1 2021
 

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