After record growth, Ed-tech sector slows down – but not worldwide

Following the pandemic-driven surge in the Ed-tech sector, enthusiasm for education technology has waned. After $20.8 billion was raised in 2021​​ and $10.6 billion in 2022, global Ed-tech funding tumbled to just under $3 billion in 2023, according to HolonIQ. This year, the decline appears to be continuing; at the half-year mark, Ed-tech startups around the world have garnered just over $1 billion, per Crunchbase data, whose numbers are pretty aligned with HolonIQ.

Still, some advancements are taking place as innovators find new ways to weave AI into the education infrastructure, from personalization to gamification, simulation training, and data analysis. What are some rising Ed-tech companies and some big investors showing interest amid the overall slump?

A lot of the excitement has gone overseas. Let’s zoom in on a few of these fast-growing new Ed-techs and note the trends.

SWANA

Corrsy, with Finnish and Iraqi roots, seeks to improve the quality of education through a gamified mobile application for young students across the South West Asia and North Africa region (SWANA). Now, it has $500,000 in pre-seed capital it raised from Iraqi VC firm EQIQ, Finnish Ed-tech angel investor Risto Vahanen, UK-based accelerator SuperChargers Ventures Ed-tech, Durubi Management Holding Company, and angel investors.

Egypt’s Sprints raised $3 million in a bridge fundraising in March, with backing from EdVentures and CFYE. “Graduate job-ready for the future!” – its website proclaims as the four-year-old company offers personalized learning courses with job placement across AI and data science, devOps, web and mobile development, software testing, embedded systems, product management, and more. Working with individuals, businesses, and governments, Sprints aspires to fill the gap in tech education in the Middle East and Africa and secures jobs worldwide for its students.

Sprints’ backer EdVentures is an Ed-tech-focused corporate VC in Giza, Egypt, launched under the learning conglomerate Nahdet Misr Group. CFYE, or the Challenge Fund for Youth Employment, supports employment initiatives in the MENA region out of the Netherlands.

Moving forward, Educatly just scored $2.5 million in a round led by TLcom Capital and Plus VC, with participation from Egypt Ventures and the HBAN in Ireland. A higher education network operating from Egypt, Educatly helps students study abroad and get into major universities.

Leoron in Dubai also made news recently, raising new capital to advance its e-learning, corporate training courses, and professional development services platform, as covered in detail by VatorNews’ Steven Loeb.

Europe

Spanish startup Masterplace raised a $2 million seed this week, backed by its founder and a group of angel investors. The blockchain-based platform began to offer a variety of online courses, both paid and free, from home winemaking to stress management and road trip planning. It invites instructors of all trades to join in and create their own content with the help of AI, while retaining their intellectual property rights and monetizing.

Milan, Italy-based Futura recently closed its $15.3 million Series A round, led by France’s Eurazeo. Other investors were United Ventures and Axon Partners Group. Futura is developing algorithms that personalize and optimize learning to speed up the process. The algorithm is said to mimic the expertise of a skilled professor and has a proven record of helping students pass their exams.

In late June, Berlin-based Bling scored $12 million to advance its family-friendly app with easy-to-understand learning to simplify day-to-day operations in the areas of savings, investments, communications, and security. Leading the round was Owl Ventures, a notable Ed-tech-focused VC firm in the Silicon Valley. Other backers were Commerzbank Group’s VC, Neosfer, as well as existing investors PEAK and Angel Invest.

Another Berlin startup backed by Owl, Morressier, raised $16.5 million in early 2024 to streamline workflows for authors, reviewers, and editors of research works, aiming to improve the integrity and processes of scholarly communications.

In London, a three-year-old startup Visibly is building modern certification programs for blue- and green-collar workers, addressing the skills gap in the infrastructure sector. The company, whose website proclaims in a frank British manner – “Stay compliant, without f*cking up your productivity” – recently raised about $7.6 million from lead investor Creandum in Stockholm and existing investors Seedcamp, Brighteye Ventures, Triple Point, and others.

Paris-based Brighteye Ventures is one of Europe’s top Ed-tech-focused VC firms, investing in seed and Series A stage. In a recent report, Brighteye said “the [Ed-tech] market is far from barren; indeed, it’s quite the opposite” – also saying the European Ed-tech market is showing more resilience than most others.

Brighteye also recently participated in a $7.3 million capital raise by UpHill Health. The Portuguese company provides software that aids healthcare teams and patients by creating structured care journeys. Its solutions are designed to improve efficiency and quality in chronic care, surgical management, and overall healthcare system coordination. Among its products is a clinical simulation tool for training. Other investors include Explorer Investments, Redstone, and Mustard Seed Maze.

The Ed-tech Focus in U.S.

Notable U.S. investors focusing on Ed-tech are NewSchools Venture Fund in Oakland, California. The firm is now focusing on creating a student-centered education system and is enthusiastic about helping Black and Latino innovators. Also in Oakland, Kapor Capital focuses on closing gaps of access and invests across various sectors including education.

GSV Ventures in San Francisco, focusing on digital learning, is known for backing Coursera, ClassDojo, and Course Hero. Bisk Ventures is also located in San Francisco, aiming “to support the innovative use of technology to engage students in impactful learning experiences and to strengthen education to employment pathways.” Learn Capital, based in San Mateo, has backed Ed-tech companies Coursera, Udemy, NewGlobe, and Andela.

Next, Bonsal Capital in Baltimore, Maryland, invests in education and workforce technology and is known for providing an ecosystem of support to its “edupreneurs.” Rethink Education and University Ventures in New York, Reach Capital in San Francisco, Edovate Capital in Denver, and New Markets Venture Partners in Maryland – these firms are a few key players in the Ed-tech investment landscape, supporting a range of innovative solutions aimed at improving educational experiences and outcomes.

Driven by a commitment to transform education, these VC firms and innovative startups have continued to attract funding and develop groundbreaking solutions. These efforts are paving the way for a more personalized and accessible learning experience, demonstrating resilience and creativity even in challenging times.

Image: Bling