“Ed-tech not entirely a bubble, will play key role in modernizing Indian education,” says Vineet Gupta, Jamboree Education

Vineet Gupta- Jamboree Education

With a virus on the loose and close contact touted as the reason for the spread, schools and universities across the world had to close their doors, perhaps for the first time in modern history. "However, as a silver lining for ed-tech companies, this largely accelerated the adoption of ed-tech in the country with parents scrambling to find the best possible solution for their children," explains Vineet Gupta of Jamboree Education Pvt. Ltd

Success mismanaged? Why are ed-tech startups struggling this year?

In 2021, over 4 billion dollars were injected into ed-tech making it the third most funded sector in India. However, a year later we hear about companies shutting down, workers getting laid off and teachers being asked to leave the platforms. "These are testing times for startups all across the board and ed-tech companies are primarily affected due to their inability to prepare for a world returning to normalcy," opines Vineet Gupta.

The sudden reality check can be attributed to several factors:

• The hyper aggressive spends taken by the ed-tech companies: A dollar too many may have been spent on advertising and marketing to wrestle for market share. Through the entirety of the pandemic, we would see ed-tech ads everywhere. ed-tech companies also struck multi million dollar endorsement deals running into years, which may be difficult to honor, in times of a funding crunch like the one we are in right now.

• While accessibility was supposed to be a strong suit, the paywalls that amounted up to almost a year of private education started acting as a deterrent for many students and parents. "One has to understand that a high percentage of the middle class don't pay the amount of fees in school compared to what they were expected to shell out for a yearly ed-tech The ed-tech companies lost out on a key consumer base because pricing was not their strong suit." says Vineet Gupta.

• The acquisitions and hiring sprees: Decisions made by the top brass to go on aggressive acquisition sprees of smaller players and offering "too good to be true" compensation packages to poach talent left a massive hole in finances.

• The constant negative news cycle also clearly had an impact: The media, especially social media, was always rife with stories, about how these companies weren't treating employees right, how the courses rarely helped or how some of them had hired teachers who made gaffes, that went viral for all the wrong reasons and brought further disrepute to the industry as a whole.

• The success of the largest vaccination drive in the world and how India accelerated towards normalcy faster than expected: India's quickly rolled out vaccination drive and its success in containing the virus to an extent led to schools reopening by the fall of 2021

What's next for Ed-tech?

Ed-tech companies will have to find ways to evolve during this slowdown. Byjus has already diversified and opened physical centers and Unacademy too has announced setting up coaching centers nationwide with the first one to come up in Kota, the hub for coaching centres. Though, this move by the latter did not go down too well with traditional coaching centers, as was evident through a widely circulated video in which the founder of a reputed coaching giant warned all their teachers against joining any of these ed-tech companies.

Industry experts feel that ed-tech companies need to understand their role as a support mechanism rather than a full-fledged replacement for learning. They also need to be better prepared to deal with turmoil as it is evident that the industry as a whole, failed to successfully navigate through the first stress test that came their way.

ed-tech has a key role to play in providing access to education to millions of children around the country who still have no access to any form of education. This segment could perhaps be their next target audience but they will have to repurpose their entire business model in order to cater to this group. Partnerships with Government agencies would help in this regard with ed-tech companies receiving contracts to educate children who are outside the education system's reach. "ed-tech rules when physical classes were shut. In the long run, both the offline and online models of education will go hand in hand as ed-tech consolidates and finds its real place in the system." concludes Vineet Gupta.