South East Asia: a hot bed for ed tech innovation and investment
The education market in Asia is growing at an incredible rate. There are now over 600 million students in K12 education (that’s almost ten times the total population of the UK). By 2020 Asia is estimated to hold the largest regional share of the global ed tech market, with over 17.3%. Investment in education, both time and money, is similarly increasing. On average, 40% of family income is spent on education.
It is not surprising then that the attitude in South East Asia towards educational innovation and new technology is both positive and supportive. This is fostering a prosperous cycle of further innovation and investment in the sector. In Singapore for instance the government actively supports new technology ventures. The state investment fund, Temasek Holdings, has committed $65 million to Jungle Ventures, and is an investor, alongside Alibaba, in TutorGroup, the china-based ed tech unicorn that raised a $200m series C round, this month, and is now valued at over $1bn. The private education sector is also expanding in Singapore. This, combined with the government support and funding of new ventures provides an encouraging ecosystem for ed tech startups.
In the last two years the ed tech support network and infrastructure have gained considerable momentum. Accelerators with an ed tech vertical are increasingly common and ed tech events are gathering more attention. In March 2015, Singapore’s first ed tech focused incubator, The Lithan Accelerator, spun out of a collaboration between Lithan Hall Academy & Red Dot Ventures. In July, Vietnam’s Topica Education Group launched Edtech Lab Asia, the first South-East Asian ed tech accelerator focused on hardware. Investors are taking advantage of the positive environment for growth and jumping eagerly on the bandwagon.
Ed Tech Asia, founded in 2013, now has hundreds of ambassadors in 13 cities across Asia. They are creating a strong network and collaborative environment for those interested in the sector to share knowledge and ideas. In some ways, they are leaps and bounds ahead of the European ecosystem.
A huge amount of capital is being invested in Asia — in July, ed tech startup Quipper, an online learning platform for K12, was acquired for $39 million by Japan based Recruit Holdings. Quipper has 1.5million learners across 9 countries. The acquisition is said to be a strategic move that will enable Recruits’ education vertical to expand their K-12 services globally. A positive scope for exit opportunities is also an encouraging factor: publishers are looking to digitalise their content and keep abreast of the fastest growing education sector, and gaming companies to diversify and expand their distribution channels.
A few trends worth noting:
Over 60% of students in Asia receive tutoring outside of the mainstream education system. Tutoring platforms like Tutor Group, Swoosh, The Graduate Asia and Epigami are becoming increasingly common and target every age group.
A considerable number of tutoring platforms, like TutorGroup, are gaining huge traction by focusing their services on English language learners. There are 300 million people learning English in China and English language aptitude correlates with a 30–50% higher income. Vipkid, who raised a $20m series B round in October, are capitalising on this at primary level. Vipkid provides 1-to-1 video language lessons offering ‘American standards of education’, delivered by American tutors.
An increasing interest and investment in children’s education is driving the growth of companies like Avrio Solutions, Classtree, Kept Me and RyMM who are attempting to bridge the communications gap between parents, children and schools.
And with the first UK robotics week announced earlier today, we thought we’d draw your attention to the sector in Asia. Companies are facilitating the learning of robotics and coding at an ever earlier age. While many of these are currently offline courses, there is definitely scope for them to scale online. Robokids and Davinci Labs are two of the coolest startups in the space. Robokids offers an online subscription that teaches kids how to ‘programme the smallest robot in the world’. How cool is that! It aims to help parents to teach robotics at home and schools to include robotics education in the curriculum. And DaVinci labs, founded in 2015, uses robotics hardware and coding software to teach primary and secondary students about the digital economy. Think Robot Wars but educational (and thankfully with no Jeremy Clarkson).
Singapore’s education system is consistently ranked one of the highest in the world (alongside Japan and South Korea) but the cost is high and education doesn’t reach everyone. University fees are one of the highest in the world. Perhaps this is why we’ve seen a growing number of platforms offering peer to peer learning. Appedu, ForExampl and Edusnap allow you to upload a photo of the homework you’re struggling with and offer instant, verified answers and help. Edusnap founder, Anders Tan, certainly thinks the demand for cheaper alternatives to after-school tuition is driving these services.
