“If e-commerce dominated the 2010s, then it is safe to say that edtech companies dominate the 2020s”.
What is EdTech?
EdTech is a short form for education technology which refers to the technological tools and media that assist in the communication of knowledge, its development and exchange. When referred to as EdTech, it is often referring to the industry of companies that create educational technology. Edtech companies in India are one of the fastest growing companies. Education Technology goes back to the 40s, in the pre internet era, where only computers were used to prepare students for the world we live in right now, which proves that this concept is old. The current market standing of edtech companies is around $700-800 million and is presumed to reach upto $30 billion dollars in next 10 years according to RBSA advisors. EdTech is one of the most money making industries in India right now and therefore, there are huge profit making industries which are investing in such startups, making these companies get a hold on the education sector.
In India, at present, there are around 4,530 startups operating out of which around 435 companies came into operation in the last 24 months alone. These companies are mainly providing education for higher education, preparation for competitive examinations, learning of language courses and school education. From the past few years, the attraction has been shifted more over to school education. As per a report from KPMG, offering of school education i.e, from 1st to 12th grade has been predicted to increase upto 6.3 times by 2022 keeping 2019 as the base.
Because of the growth of many EdTech startups in India, it is in the top 3 emerging countries to get global capital fundings to start new ventures in the edtech sector after the US and China. Namely, Byju’s and Unacademy are some of the most highly valued companies in the global market that originated from India.
From 2015 to march 2020, Byju’s had a whopping growth in their subscription of around 50 million free subscribers in just a span of 5 years, and around 70 million subscribers in the last few months out of which around 4.7 million subscribers are paid. It has a net worth of around $2.32 billion. As for Unacademy, it has earned around $354 million in just a span of a few months. However, not all startups have been able to sustain in this market because of lack of capital and proper teaching base.
Some of the top EdTech startups also include Vedantu, Topper, Upgrad, etc. One of the main reasons for the growth of the EdTech sector is due to the ways of the current education teaching system which focuses more on the traditional aspect of teaching, that is, more theoretical knowledge. During the covid times, this mode of education escalated quickly and is still emerging. Even though e-learning is a viable solution seeing today’s situation, there are still challenges which are to be taken into consideration. It is well appreciated how the EdTech companies are helping the majority, but education, sadly, is a cross selling business wherein they have enough data so as to manipulate you in a way where even you won't even realise how easily you got persuaded, and that’s because of the unethical marketing practices which are being used.
For example, Byju's valuation in 2018 was $1 billion and presently i.e. in 2021, it is around $18 billion. “How is this possible?”, is probably the first question which comes to our mind and the answer isn’t the quality of education they provide, but the extensive marketing strategies. In 2021 alone, Byju's bought fourteen big startups which included Aakash Coaching for $950 million and WhiteHat Jr., a famous website to learn coding for $300 million. Byju’s also has an internal punishing culture based around high profiled clients, hard sales tactics, persuading parents’ insecurities regarding their child’s future, and so on.
Our Indian society focuses majorly on the grades rather than the knowledge acquired by the child and this is exactly what some EdTech companies like Byju's use to promote their sales. In an interview, a parent of a 6 year old boy said “EdTech is trying to solve problems that don't exist”, this statement was made when a salesman asked them to enroll their 6 year old child for coding.
During its advertisement on television, allegedly a 9 year old boy, Wolf Gupta cracked a 1.2 crore package by learning coding from WhiteHat Jr. Interestingly, this story had different dimensions wherein the advertisement, sometimes, referred to the 9 year old boy as a 10 or a 12 year old boy and often his package varied from 1.2 crore to 10 crores and sometimes even 150 crores . This simply shows that the story is fake and that it was just a marketing stunt pulled by WhiteHat Jr. which is now under Byju’s.
According to the statistics, in 2019, Byju's marketing spend was Rs. 457 crores which grew in 2020 to Rs.1,175 crores. Interestingly, marketing spend is just done to maintain its brand value, but the main revenue generation is done through their sales tactics. In an interview, a former sales executive of Byju’s revealed how they were just given a sales target and how as long as the target was achieved, nothing else mattered.
Byju’s also uses excellent advertising techniques, that is by making Shah Rukh Khan as their brand ambassador, doing regional campaigns for example, in Kannada and Telugu languages. In the ‘Keep learning’ campaign of 2019, Byju’s was a leading sponsor for the Indian cricket team which was a huge success too.
Byju's starts tracking their target audience by first giving them a 15 day free trial. In the meantime, the team tracks all your records in those 15 days and after that, a sales pitch is prepared, in which they categorise students on their ability to grasp things and persuade parents accordingly, hence knowing exactly how to present their product.
Therefore, like any other company, the motive isn't about providing good quality education, but to attract people to avail their convenience provided in the comforts of home. As appealing as it sounds, it's quite dangerous as Byju’s has been acquiring the whole educational sector, therefore, it is important to take precautionary measures.
Our education system is based on work which is not really applicable in real life field work and therefore, this problem can be solved by providing private input in the curriculum, that is, introduction of vocational classes which hopefully the New Education Policy of 2020 encourages and which will be implemented from 2022. We therefore need more quality institutes and more vocational training programs. APJ Adul Kalam once said “We all don't have equal talents, but all of us have equal opportunity to develop that talent”. The rise of digital education in India was believed to ensure that everyone had the same opportunity of success. But in reality, even the digital sector will create a divide if proper steps are not taken to ensure its fair use.