Edtech & Future of Work Highlights — March 2023

Monthly Fundraisings

• March’s fundraising pace ($339m) fell behind February’s ($604m) by 43%, and is still far below last years’ levels ($2.2bn).
• The prevailing context of macro-economic uncertainties with rising inflation (global rate at 7%), and bank runs from SVB, Credit Suisse, First Republic could explain this slow pace as cost of capital increases making equity raises more expensive.
• In March, we observed fewer growth rounds in value and volume compared to last year. 2 raises by MentoriQ ($80m, US) and Medwing ($44m, Germany) for a total funding value of $124m vs. 6 growth rounds last year that totaled $1.2bn mostly by BYJU’S ($800m, India), Connecteam ($120m, US), Staffbase ($115.2m, Germany).
• Whilst startups with high growth potential and attractive market opportunities are still relevant to investors, there’s an increasing emphasis on startups with clear paths to profitability and that can weather market downturns.
• Investors are paying close attention to companies’ burn rate and cash position, particularly in light of economic uncertainty and the potential for further downturns.
• North American companies attracted most of the global funding amount (60%). The European counterparts accounted for 31% of total funds, a 9 points increase from the previous month, confirming once more Europe’s rising traction in the global Edtech & Future of Work spaces.
• MentorcliQ closed the largest round, raising a $80m Growth Round from Plymouth Growth, Providence Strategic Growth (PSG), and Rev1 Ventures

Some notable funding rounds around the world

• Other notable funding rounds include: Medwing ($44m, Germany), RedShelf ($15m, US), LangChain ($10m, Singapore)
• Future of Work: Digital Bicycle (US) $13m in a Series A round, Glider.ai a (US) $10m Series A round.
• Future of Education: Mentorshow (France) secured €15m in Series A funding, Edurino (Germany) raised $11m in Series A

M&A Deals

• There were 25 M&A deals in March
• Paper acquired Readlee, a US-based learning tool that uses artificial intelligence and speech recognition technology to help students improve their reading skills.

Paper is a Canadian educational support system (ESS) that supports more than 3 million students in over 300 unique school districts across 40 US states and Canada. Readlee will become Paper Reading, the addition of which is part of Paper’s ESS, which aims to help students throughout their academic journey and after graduation, regardless of their preferred path.

In 2022, Paper secured $270m in Series D funding led by Sapphire Ventures & Soft Bank.

Trend of the month

Source: Educapital, Crunchbase, Dealroom, IMF, Financial Times

Infographic — March 2023