Cracks began to appear in the edtech sector in February, when Ronnie Screwvala-backed Lido announced its closure. Since then, reports of shutdowns and pink slips being handed out in the edtech sector have garnered media attention. Companies like Unacademy, BYJU’S, Whitehat Jr., Toppr, Vedantu, FrontRow and Udayy, among many others, have recently been in the eye of the storm.
According to data from various media, it is likely that more than 10,000 employees have been laid off by edtech start-ups. Business priorities, team optimization, long-term goals, and low growth are some of the top reasons cited by CXOs for this phenomenon. More importantly, the sector has been shaken by global macroeconomic conditions associated with the reopening of schools, colleges and physical course centers.
Now the question is, is India’s IT sector in decline?
Maybe, but it will always remain the support system of the conventional education system in India, answers Dr. Silpi Sahoo in a one-on-one conversation with SME Futures. She is president of the SAI International Education Group and has worked hard to build the country’s education system and create jobs in this field.
Since February, India’s edtech space has been making headlines for mass layoffs. Is edtech failing? What are your thoughts?
Decelerating demand for tech-enabled educational services, coupled with financial downtime, has had a domino effect on India’s thriving edtech companies, forcing them to lay off workers, slow expansion, reduce overspending and exploring new avenues of profit. Some edtech companies have indeed closed shop.
One of the main reasons for this phenomenon is that, in practice, edtech companies will always be a support system (facilitator) for the mainstream education sector. However, it can never replace classroom learning. Adding more value to the existing learning methodology instead of trying to completely replace it is what most of these edtech companies have overlooked.
Layoffs at several edtech start-ups such as BYJU’S, Unacademy, Vedanta, Eruditus, Frontrow, Invact Metaversity, and Yellow Class should be considered. In my opinion, all of these companies have downsized for related issues.
To begin with, these developments came after India’s IT sector experienced a dream run. The arena produced unicorns in a short time as the pandemic forced physical learning institutes to close. The excitement around edtech has made it one of the most funded sectors in India and beyond. The industry has raised about $5 billion in India according to reports.
Now, with the epidemic waning, these companies are experiencing mass layoffs.
At the same time, Ivy League institutions like Harvard, Stanford, and Columbia offer great distance learning courses around the world. They didn’t start this only after the pandemic. Likewise, various international schools in India that follow a blended learning format are still doing well, as their approach has never been based on the idea of completely replacing a conducive classroom environment.
But the education system is becoming hybrid. So why are edtech companies struggling to stay relevant? Where are they going wrong?
It’s true! I believe that replicating a model that has been largely limited to books (i.e., the classroom learning style) will now encounter several obstacles. It is better to perpetuate and deepen the idea of accentuating the level of learning provided in class by adding more value to it.
Additionally, parents have become more reluctant to sign up for online classes now that students are returning to schools and colleges. There is this feeling of missing something, especially in the case of parents who are caring for children who are still in their formative years. They worry that their child’s confidence and social skills will be affected because they have had no interaction in a social setting for the past 2 years.
Looking at the scenario from a non-pandemic perspective, for any start-up, including in edtech, before embarking on their business, their concept must be based on a unique strategy and a long-term vision. And if their vision was to capitalize on a single short-term problem – the “pandemic” – then the motive for an association itself is questionable; forget his growth.
Students these days want to learn in their own learning style and at their own pace, and a lot of innovation should be aimed at making personalization as efficient as possible.
To achieve this vision, data and analytics will be essential. Carrying out accurate market segmentation and research in the relevant country will allow these companies to reap maximum results. A client-centric, values-driven model is imperative for the survival of any association, and the education sector is no exception. Unfortunately, most companies do not understand the needs and preferences of their consumers and therefore disappear. The sole aim of the education sector should be the complete education of children by opening the floodgates of knowledge to them.
What strategies are needed for the survival of edtech start-ups in the post-pandemic world?
Putting their stakes on a value-driven model must be the primary focus for budding start-ups to sustain and grow post-pandemic. Models should be built keeping in mind innovative ways to serve students with convenience and ease, to let them invest in the idea of it. Their goal should be to “deliver” knowledge and to do so without fail.
Edtech companies must replace outdated systems and procedures with state-of-the-art technology. As we move toward a future of lifelong literacy and cohort-based literacy platforms, edtech companies will need to be more creative in delivering content. It shouldn’t just be about putting intriguing material on a screen; they need to have an idea of what this screen looks like, what it tracks and what it offers. Creating an educational experience that can never be achieved in a classroom is imperative if edtech companies are to remain significant over the long term.
As the value of constructive literacy and conceptual global learning becomes widely recognized, edtech forums should evolve and initiate more innovative strategies to make their literacy forums more interactive for young people. Stories can be used to explain the most intrinsic concepts using virtual reality to make it more interesting. Children can be taught using creative methods, with their tutors playing their favorite characters. The integration of the metaverse into the technological aspect of education can also be explored. The virtual world intrigues children anyway, imagine your favorite character in an embodied virtual reality experience answering your questions in a doubt clarification class.
Edtech companies should come up with innovative ways to meet the needs of kids of different age groups with succinct content, so they don’t lose interest. Short, simple and interesting content explained in a language better understood by Gen-Z, will keep them hooked. Bringing a new product to the table and keeping it relevant to students will help these companies stay relevant in the future. Schools that have invested in an edtech mode of learning for the sole purpose of maintaining a repository of learning materials, assignments, tests, and more that students in all grades can refer to, come out exceptionally well. It was extremely convenient for the students and facilitated the learning process. The schools were closed but the learning did not stop, and the methodology followed continued to add value to classroom teaching even after the schools reopened.
COVID-19 has been a milestone for students, parents and educators as it taught them how to learn during a pandemic. As a result, much of the country’s education sector has migrated online. Likewise, some aspects of the “new normal” have been instilled in today’s classrooms. A blended or hybrid learning style is now central to the best learning experience, and edtech companies should be aware of this.
Especially now that a growing number of teachers and other educators have become more digitally empowered. Now they are using cutting-edge technology in their classrooms to make learning more engaging and interactive. They now have an open mind to the benefits of digital literacy. In addition, the use of technological tools to specifically meet the personalized needs of each child has become quite common.
Instilling the creative elements of edtech in the classroom or as part of an after-school or distance learning program will generate more interest among students. If edtech startups can embrace this shift in mindset instead of trying to completely take over an existing framework, they will continue to grow.
Soon, we can expect virtual mentoring and training to take over the education sector. Quality subject matter, focus, mobile and active values-based literacy, creative ways to engage students, and the ability to publish and share a student’s work within the wider community are a few -some of the important aspects that edtech start-ups need to consider in the post-pandemic world to future-proof their businesses. Indeed, before the pandemic started to fade, some edtech companies had made the right decisions. The future belongs to those who will continue to innovate while focusing on sustainability.