The pandemic puts the EdTech market in full swing

Record of investments, flowering of thematic funds, stock market ambitions and internationalization: in full frenzy, the educational technologies market (EdTech) boosted by the crisis, sees in the new suspension of face-to-face classes an opportunity to grow.

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Segment hitherto under-invested in the education market, EdTech has experienced "

an explosion with the crisis

", observes Marie-Christine Levet, founder of Educapital, a European fund specializing in digital education.

“

While millions of families will experience distance schooling again, there is a real opportunity for growth in the sector in France,

” she told AFP.

For more than a year, schools, universities and companies have been forced to invest in digital solutions for education and vocational or continuing training in response to planetary lockdowns imposed by the pandemic.

“

EdTech started the last decade with $ 500 million in venture capital invested in 2010 and ended 32 times higher, at $ 16.1 billion in 2020,

” according to CPR AM's annual report on its Invest- Education.

This investment record is more than twice as high as in 2019 and 2018. And experts agree that the sector has gained five to ten years in terms of the pace of development and that this digital shift is intended to continue.

A lasting dynamic

Before Covid-19, the market potential was estimated at 325 billion dollars by 2025. Now, estimates are around 400 to 500 billion, including 50 to 90 billion attributed to the timeliness of the crisis.

In 2020, it represented 186 billion dollars, or a grain of sand (3%) of the very fragmented education market, which came late to digital.

Although initially forced, the adoption of uses has been very strong, say the experts.

“

Edtech will grow even faster than the rest

of the education sector, by 15% per year by 2025, also estimated in March Alice de Lamaze, manager of the Pictet Human fund.

What fuels this growth, details Benjamin Vedrenne-Cloquet, boss of two SPAC listed on the Nasdaq, whose objective is to buy companies specializing in EdTech, "

it is the double billion

".

A market dominated by China

The first, demographic, corresponds to the forecast of new entrants in the education sector to 2030. The other, financial, stems from "

the accelerated obsolescence of assets thanks to artificial intelligence

" which encourages constant renewal. the offer of products and contents.

The market is largely dominated by China, which has made education a major stake in its development, but Europe intends to take advantage of the recent adoption of new, more personalized and more immersive learning tools to catch up on its lag in the field. school and university education.

If education is a sector highly prized by private equity funds, the enticing market capitalizations have something to dream of digital educational specialists.

China's after-school tutoring specialist XDF is worth more than $ 24 billion.

And listed since March on the Oslo Stock Exchange, the Kahoot!

is currently worth over $ 4 billion.

In the United States, where listed EdTech companies experienced a good stock market performance (+ 330%) from January 2016 to December 2020, several unicorns including Duolingo and the Californian Coursera are planning to take the plunge.

“

There is an upward trend in distance education, but that does not mean that all models are resilient,

” tempers Marina Iodice, who oversees the Health and Well-being equity fund at NN IP.

For EvidenceB in any case, the future looks very promising and international.

The start-up, which combines cognitive science and artificial intelligence to offer personalized learning to students from primary to high school, has tripled its turnover since its first fundraising at the end of 2019.

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Asked by AFP, its founder Thierry de Vulpillières is confident to repeat the same feat this year thanks to the conquest of the international market.

"

There is a considerable value on French pedagogy which should not be an object of redemption but an object of export

", indicates the entrepreneur who has just completed a partnership with the world leader of school publishing Pearson in the learning Latin in Italy.