Cisco is positioning itself as a major player in education and learning through its integrated communication and collaboration platform. This includes high-end audio and video conferencing systems like Cisco Telepresence used by universities, as well as video-conferencing products. Cisco also offers WebEx Social, a private social network for educational institutions that enables asynchronous and real-time communication through features like chat, audio, video, and desktop sharing. Cisco aims to address issues with current decentralized and email-reliant systems through an intuitive interface on its platform.
5. Selected VC investments in EdTech
Well-known "Blue Chips VCs" with small number of education and learning investments:
Accel Partners -- Educreations, Mind Edutainment, and Knewton
Sequoia Capital -- Mindsnacks, TutorSpree, Inkling, and Piazza
Greylock Partners -- Edmodo, UniversityNow, Treehouse
Benchmark Capital -- Edmodo, Minerva, and Grockit
Khosla Ventures -- Littlebits
Kleiner Perkins -- Codecademy, Courserva and Chegg
Google Ventures -- Smarterer, and Stickery
Founders Fund (Peter Thiel) -- Quora and Knewton
VCs and Investment Companies with small number of education and learning firms in their portfolio:
Union Square Ventures -- Edmodo
New Enterprise Associates -- Coursera
Andreessen Horowitz -- LearnSprout
Menlo Ventures -- Luminosity
University Venture Fund -- UniversityNow
WestRiver Capital -- 2U (ex 2Tor)
Ft Venture Capital -- Voxy
Felicis Ventures -- Piazza
CrunchFund -- Codecademy
Mission Ventures -- KidZui
[80 other VCs identified with small investments in education and learning companies][
5
6. US Education Landscape: Selected
Drivers
K-12 Sector:
Need for Major Changes to Address Existing Problems
Forerunners Setting Examples
Growing Perception of Significant Potential of Technology
Greater Need for Student Centricity
Growing Availability of Data for Design more Effective Learning .
Recognized Need for Outcome Focus
Need to Do More With Less
HE Sector:
Growing Recognition of Needed Change in HE Also
Greater Potential Role of Technology and Online Learning
More Difficult Financial Environment Creating New Reality
Growing Interest in "New Models"
New Computing Models and Technology Solutions
6
8. Incubators With Major Focus on
EdTech
Imagine K12 Silicon Valley. One of biggest and most notable
incubators for EdTech
SIIA Innovation Sponsors annual incubator program focused on EdTech.
Incubator Program1 Participants must meet certain criteria
4.0 Schools Based in Louisiana, it helps entrepreneurs start schools
or education-related businesses in Southeastern US
StartL Emerged out of Stanford University to help students with
startups--focused on digital innovations for learning
Socratic Labs NYC-based accelerator will select cohort of 10 companies
in January of 2013
Center for Educational Israel-based incubator established to help advance the
Technology Incubator educational system in Israel
Startup Weekend EDU National organization in US that supports local
communities of entrepreneurship
Learning Technologies NASA program to provide funding, tech tools and
technology services for STEM-focused entrepreneurs
Macmillan New Ventures In-house incubator for EdTech and company has already
invested $100 million in acquiring startups
Stanford Learning, Program at Stanford School of Education and provides
Design and Technology support and assistance to budding EdTech entrepreneurs
Source: 10 EdTech Incubators Aiming to Change Education
1
Software and Information Industry Association
Forever; TeachThought; October 2112; Strategic Business Insights
8
9. VC investments in EdTech--Selected
Companies
Minerva (project) -- $25 million in April, 2012 by Desire2Learn -- $80 million in one round of funding in
Benchmark Capital September 2012
"The Minerva Project is rethinking the role of an Has been self-funded and profitable for many
elite institution of higher learning” years and recently changed strategy to seek
outside funding
Chegg -- $195 million since 2005 in 7 rounds of
2U -- $90.8 million over four rounds in 2009-2012; has
funding; numerous investors
a number of large investors
Started as online textbook rental company but
2U partners with universities to build, administer,
rebranded as "social education platform” and now
and market online degree programs
ow positioned as "Your Academic Hub"
Edmodo -- $40 million in three rounds in 2010-2012; Knewton -- $54 million in four rounds starting in May
has a number of large investors 2008; has number of marquee VCs as investors
Company intends to "… help educators harness Adaptive Learning Platform that customizes
the power of social media to customize the educational content based on student needs; also
classroom for each and every learner.” provides test-prep courses
Grockit -- $27.2 million in four rounds of funding
started in July 2007; investors include GSV Capital,
Benchmark Capita and Integral Capital Partners
Grockit has built a social learning test prep
platform for license and direct-to-consumer
products.
9
10. NewSchools Venture Fund EdTech Map
Source: Michael Horn, Innosight and Anthony Kim, Ed Elements
(http://www.newschools.org/entrepreneurs/edtechmap) 10
11. Education and Learning Markets: Large,
Diverse and Complex
GSV Advisors eLearning Estimates
Legend
Total
$90.9B Higher Education
Corporate
GLOBAL
K-12
$48.8B us
$32.5B
$25.5B
$17.4B
$16.6B
$9.6B
$5.4B
11
12. Market Segmentation Perspectives
Type of buyers Needs/Challenges
Schools and school districts vary greatly
K-12 (public and private)*
in size and budgets
Higher Education Institutions Many HE have larger tech budgets but
(HEI)** under pressure to reduce their costs
Need flexible and on-demand training
Industry
offerings
Growing budget pressures drive their
Government
purchasing
Consumer Shorter sales cycle and growing needs
* New York City Department of Education: 1,042,277 students; 1,700 schools; 75,000 Teachers
and annual budget of $24 Billion
Los Angles Unified School District: 707,627 students; 730 schools; 45,500 teachers; and annual
budget of $7.3 Billion
** Almost 4,500 HE institutions in the US, with total enrollment of 18.2 million students;
University of California has 10 campuses, with 235,000 students and California State University
system has 23 campuses and 400,000 students
12
13. Education and Learning Markets:
Opportunity Segments
Users of Services: Students, Teachers, Administrators, Parents
Video use in
Pilots have
demonstrated
Internet Access Devices education
may follow
major cost
explosive
savings Resources and Applications consumer
adoption
Education Resources & Services Authoring, Editing, Disseminating Administrative
& Content Management
(Open & Proprietary)
● Scheduling personnel/HR
Text processing ● Audio/video
Digital textbooks ● Digital libraries ● Plant/facilities
capture/edit ● Programming
● Tutoring systems ● Simulations management
Platforms ● Blogs ● Wikis
● Augmented reality ● Interactive ● Procurement ● Attendance
● Instructional/course
Visualizations ● Student records
management
Various federal
Assessment and Reporting
and state Analytics for
initiatives Social Networking and Collaboration adaptive
learning
Public and Private Network-connected Clouds--software services, data libraries & repositories
Source: National Educational Technology Plan, 2010; page 59; and Strategic Business Insights
13
14. US and Global Education Landscape:
Four Areas of Change and Opportunity
A few major areas that will see significant
change and opportunity
Data Mobile
Social MOOC*
* MOOC: Massive Open Online Courses
14
15. Learning Analytics: Area of Growing Interest
Sophisticated
Learning and Data Mining
Technology Platforms
Data Predictive
Warehousing and Techniques
Cloud Computing Next-Generation
Learning
Analytics
Adaptive learning
Personalized learning
paths
Instructor Dashboards
1
See Enhancing Teaching and Learning Through Educational Data Mining and Learning Analytics: An Issue Brief; by
15
Marie Bienkowski, Mingyu Feng and Barbara Means, Center for Technology in Learning, SRI International
15
17. Who is Doing What?
211 courses offered by end of
2012, from 33 universities
University of California,
Berkeley, University of Texas
(UT), Wellesley, and
Georgetown are also part of
edX. UT says "there will be
degree and certificate and
professional development and
training programs for health
care professionals."
At end of 2012, Udacity was
offering 19 courses
In December 2012, Open
University launched its
FutureLearn MOOC platform
together with 11 other UK
educational institutions
Table source: The Crisis in Higher Education; by Nicholas Carr; Technology Review, MIT; September
27, 2012
http://www.technologyreview.com/featuredstory/429376/the-crisis-in-higher-education/
17
18. Learning Management Systems Providers
Education-focused "Incumbents":
Blackboard Selected LMS Industry Characteristics and
Desire2Learn Developments:
Pearson
Moodle Incumbents:
Sakai Becoming more learner-centric and looking beyond
managing learning logistics
Improving UI and usability
Education-focused "Emerging
Involved in growing M&A to beef up capabilities and
Contenders":
competitiveness
Instructure
Epsilen
Emerging Contenders:
Loudcloud
Taking advantage of new tools & tech
Lore
Often more web- and cloud-based
Schoology
More social media friendly
Edmodo
More flexible
Testing new business models
Industry-Focused Players:
Saba Industry-focused Players:
SumTotal Many LMS systems building up talent management
WBT Systems capabilities (to serve broader HR functions)
Skillsoft Plateau acquired by SuccessFactors which in turn
NetDimensions was acquired by SAP
ElementK
LearnShare 18
18
21. Media Companies: Growing Interest in
Education Sector Opportunities
Selected quotes of Joshua Kim, Inside Higher Ed, August 20, 2012, from his article
about "Media Companies, Seeing Profit Slip, Push Into Education;" New York
Times, August 20, 2012
"Discovery (the cable TV company), News Corp, NBCUniversal, and Walt Disney are media
companies dipping into the education business"
" Education is emerging as an answer [to challenges the Web has presented to current business
models of media companies], largely because executives see a way to capitalize on the
changes that technology is bringing to classrooms."
"The current education business focus of these media companies appears to be the K-12 market,
but how long will it be until these same media companies look for a slice of the $4.5 billion
dollar higher education textbook market? Beyond textbooks, annual higher education spending is
somewhere north of $475 billion a year."
" The market for edutainment will much larger than we realize. Consumers will pay for learning
experiences that retain the production values and narrative drive of the best games, movies, and
television shows. The growth of open online learning will also open up a larger market for exclusive
learning experiences. Media companies are well positioned to serve this high end."
" I could see large media companies getting serious about the educational space via strategic
investments in edtech startups. It is possible to buy into the educational space at much lower
multiples than in other technology sectors (say gaming) - opportunities abound."
Content Tech Others starting to make moves
into education/learning:
Amazon, Netflix, and others
Services
21
22. The Digital/Virtual Game Landscape
• Global Video Game Industry: Varying revenue estimates but
likely ca. $70-75 Bill in 2011 [US: Total of $17.5 Bill (down 8%):
Content ($9.3 Bill); HW ($5.6 Bill) and Accessories ($2.6 Bill) According to Atos Group--a large British
acct to NPD Group] consulting firm--Serious gaming industry is
expected to reach revenues of Euro 10 Bill by 2012
• Forecasts vary: $81B by 2016 by DFCI* while Gartner
estimates $115 Bill. by 2015 (driven mostly by mobile gaming)
Types Intent
Videogames Entertainment
MMORPGs*
"Serious Games"
Virtual Worlds**
Casual Games***
… Game-Based Learning
Gamasutra** reported on study that
estimated global MMORPG market would
reach $8 Bill by end of 2010, up from $5 Bill
According to Ambient Insight--a research and consulting
in early 2009
firm focused on technology-based learning--the US
Game-Based learning market reached $232 Mill in 2010.
The company expects the market to grow to $413 Mill in
According to Kzero*** the vast bulk of VW users
2012.
are in the age brackets of 8-15 years of age. One of
the largest VWs catering to this age group is
Habbo Hotel of Finland (with average of 10 mill
unique visitors monthly); Eve Online has over
400,000 subscribers in older age groups.
* DFCI= DFC Intelligence (Video Games and Entertainment Industry research company); NDP Group: Marketing research group
** Gaming media company; *** British marketing and research company that tracks virtual worlds trends; 22
23. Implications for Nordic Entrepreneurs
What are similarities and differences between US versus European and Nordic
education and learning sectors?
Very different structure and funding systems--and role of central vs local
governments
Problems in education sector (much?) less severe than in US, resulting in
lower perceived need for changes and tech?
Less receptive sector for for-profit startups in Ed sector in Europe/Nordics?
Much less "buzz" about EdTech in Europe/Nordics than in US, at least right
now?
Tech in Education:
Will also penetrate Ed sector in Nordics--but in different ways and with
different speed? What will be major differences?
Much tougher to find adequate venture funding in Europe/Nordics
Smaller and more homogeneous markets make comparisons to Singapore
more appropriate than to US?
Adoption of best practices can see more rapid adoption in Nordics
Training of teachers for EdTech can be faster and less painful than in US
Great opportunities to build Nordic EdTech Forum or Community of Interest
23
