By Benjamin Vedrenne-Cloquet, EdTechX Holdings
When comparing trends between developed and developing worlds, one thing becomes clear. Emerging markets are not only more open to using EdTech, but are also more willing to pay for it. There are four main reasons as to why: digital supremacy — there are more people in emerging markets connected to the internet, the tipping point being reached in 2017; these markets represent 90% of the world population under 30 years old, creating a generation impact; there is less government inertia to stall the development of EdTech and finally there is more appetite for education, driven by the understanding that better education brings better life outcomes.
Most notably, Asia is becoming an education powerhouse. China alone has one of the largest education markets in the world, with an estimated $300 billion in revenues. The demand for education in Asia is unprecedented and unparalleled — 90% of growth in student enrollment between 1999 and 2012 came from Africa and Asia. Yet, Asia is distinguished from Africa, due to the tremendous demand for high quality private education offerings. Asia is expected to contribute 80% of international higher education enrollment growth between 2003 and 2020!
Asia’s EdTech industry is also booming. Eastern EdTech brans have been able to capitalise on Asia’s demographic — population size, increasing middle-class income (including at least 2.5 million millionaires) and increasing spend in education. Chinese families are projected to be spending six times more on their children’s education in 2020. China’s eLearning user base alone has over 150 million users at any one time. This is 50% of the total U.S. population, however, only 11% of the population in China are accessing eLearning.
Evidently, investment is pouring into the Asian EdTech market. China’s education sector, which was a relative stranger to the capital market a few years ago, is now diving into the public market. In 2018 alone, China-based edtech ventures raised $5 billion with 538 deals. From that, China based education saw 14 IPOS and 35 M&A deals. In terms of destination, five of the IPO’d companies were listed in the U.S. Asia is thus rebalancing the U.S’ global influence. Driven by its ability to leapfrog infrastructure, the growing investment in the sector means that Asia is outgrowing and infiltrating the U.S. market. The EdTech market in China has played to the advantage of the emerging markets, now representing the biggest market for education and training.
This exert was taken from a report by CITI : http://citi.us/2qRpeYu