Rama Krishna Sangem
Edtech (Educational Technology) firms that made huge money during Covid pandemic four years ago are now steeped in unbearable losses. This is the trend all over the world, more specifically in India. Several Edtech firms rose to the level of giants, while others turned unicorns (valued at one billion US dollars). Suddenly, everyone showed interest to invest in them. Their stock sold like hot cakes in the market.
Suddenly, the situation has changed after the pandemic. Once the lockdowns are withdrawn and regular schools and college reopened, these firms have faced a rough weather. Enrollments in them have decreased and then begun the cost cutting measures – like removing teaching and non-teaching staff, trimming administrative and campaign budgets and finally the capital spending (core teaching material preparation) too.
Today’s (February 20), Monday, newspapers carried a story that Byju’s has vacated about 4 million sft of its rented office space in Bangalore currently. With this, Byju’s will be saving Rs 4 crore rent per month. The fact is Byju’s has defaulted on rent payment for its 5 million sft office space for about 10 months. This shows the pathetic condition in which India’s leading Edtech company is now.
Not long ago, Byju’s is the poster-boy of India’s startup success story and burgeoning Edtech sector in the country. Most venture capital funds from within and outside the country, vied with each other to lend it money. It’s share values touched peaks, for a moment. But, once the pandemic is over and regular educational institutions have opened the troubles of Byju’s started. Same is the story of several other Edtech firms.
What went wrong?
A major reason is that Edtech companies haven’t realized their slot or role. On paper,education is a non-profit activity in our country. Though heavy investments are made into private educational institutions, they are run by societies – not by companies or partnerships. But, these Edtech firms are private or limited companies. Their funding too is raised on pure commercial terms. So, there is confusion over their governance and profit making drives.
In the beginning, just any online teaching is considered as Edtech. Be it a CD or a video class, every such activity is called Edtech. A Zoom class from a teacher is enough to call it Edtech. Post-pandemic, the situation is changed. Students want more than what a regular school or college offers them. Edtech is expected to raise its bar. Moreover, Edtech classes are not substitutes to regular curriculum.
Greed for funds and crave for cash in hand too is another drawback of Edtech sector in our country. Recently, Ronnie Screwala said somewhere that more than liquid cash, Edtech firms should scale up their capacities and range of services they offer. Deep research must be done to know the current and future needs of students. Edteh firms should fill in the gaps of regular teaching methods and find new techniques.
Advent of AI and enhanced 3D gadgets offer enormous scope for expansion of Edtech. Personalized teaching and graded classroom experience are going to be the new norms. Of course, over the millennia formal education has evolved into a teacher-student interface. Nothing can substitute in the immediate future. Even the distance learning courses too have some amount of contact sessions.
Edtech firms should keep this in mind. They can expand their scope – on all sides of formal in person classroom teaching. Enhanced classroom experience too is a tool they cannot forget. More than funds and liquid cash, Edteh firms must focus on Research and Development. Of course, governance of internal finances is another concern, Edtech must address at once. Edtech must move ahead.
