The Australian education technology (edtech/edutech) sector is undergoing a period of substantial growth and expansion. You’d be forgiven for thinking the growth was solely attributable to the rush to digital learning brought on by the Covid-19 pandemic. However, Australia’s reputation for offering first-class education, along with its tech-friendly regulatory environment, has driven significant investment in edtech over the past decade. In fact, Australia’s edtech sector employs around 13,000 people and is the country’s second largest start-up industry, behind fintech.
Between 2014 and 2019, the number of edtech businesses grew from 350 to around 600. This growth continued through 2020, when more businesses than ever progressed beyond start-up to scale-up phase; the proportion of Australian edtech businesses with revenue of more than $500,000 per month increased from 20% in 2019 to 29% in 2020.
The factors behind this growth are varied and closely linked to the demands of specific education segments, which can be broadly defined as K-12 (kindergarten to Year 12), tertiary, vocational and workplace-based learning. Here's how some of the top Australian edtech companies are transforming the sector.
In the K-12 segment, the focus of technology providers has been on improving student engagement, both “in-semester” and pre- and post-enrolment. Advances such as interactive screens, content curation tools, peer-to-peer mentoring and community-building services are all among the technologies being adopted in classrooms across the globe.
Founded in 2016, Inquisitive is a platform and content library which covers science, history and geography subjects for years F-6. Subscribers (teachers and schools) are provided with curriculum-aligned lesson plans and a range of supporting stimuli (including e-books, videos and interactives). The system is used by more than 29,000 teachers in 4,300 schools, which represents more than 60% of Australian primary schools. In 2021, Save the Children Australia invested in the platform through its Impact Fund, saying Inquisitive has the potential to boost teaching capacity in low socio-economic, rural and remote schools, where teachers are time-poor.
Recognising the value of the social aspects of primary schooling, as well as the dangers posed by our digitally-enabled world, Claire Orange created DiGii Social. Promoted as a world-first social media education platform for upper primary school-aged children, DiGii Social provides immersive, artificial intelligence (AI)-based digital education for 9–13-year-olds, to help them develop skills in cyber-protection, cyber-identity and cybersecurity. As an educational tool, DiGii’s child platform is only available to students during the school day and is secure within each school, with no outside access – even by parents.
The increasing competition between institutions across the globe has driven technological reform in the tertiary segment. Rising student debt and a perceived decrease in the return on investment for degrees, coupled with inefficient administration and rising tuition fees have led to universities competing for a smaller pool of students. In response, edtech solutions have evolved to help decrease student acquisition costs, improve onboarding and the administration experience, and increase online accessibility.
Attracting $22.7m in Series A funding, Adventus.io has been embraced by over 1,500 global tertiary institutions. The SaaS-based student recruitment platform enables higher education institutions and recruitment agents to find and transact with each other. According to one expert, 70% of university student positions are placed by recruiters. Adventus.io aims to reduce the administrative burden this places on institutions and recruiters alike. In 2021, the company launched a real-time data analytics platform to help universities better understand their student acquisition funnel.
Also garnering attention in overseas markets is online assessment platform, Cadmus. Beginning as a research partnership with the University of Melbourne in 2015, Cadmus first engaged in addressing the issues of academic integrity and contract cheating. Shifting their focus to support all aspects of university assessment, the company built an online platform that allows institutions to create engaging, secure and scalable digital assessment programs. In 2021, Cadmus joined the AWS EdStart start-up accelerator program, with a view to further expanding its global footprint.
Workplace and vocational
For workplace and vocational educators, the evolving nature of the workforce has had a direct impact on the delivery of educational programs. The trend towards reskilling and lifelong learning is driving demand for flexible methods of study, like online education, as well as customisable content services which can be offered as a value-add to attract new employees.
Leading the technology charge in the external education market is Australia’s first edtech unicorn, Go1. Founded in Queensland in 2015 and accepted into Y-Combinator accelerator, Go1’s content hub provides digital workforce learning, including professional development, wellbeing and compliance subjects. Offering solutions for small businesses, governments and enterprise businesses, Go1 says it is the world’s largest digital learning library, using “playlists” that tap into content from hundreds of publishers. Go1 uses AI tech and analytics to determine the effectiveness and usage of its content, which can be plugged into an existing training platform or implemented through a standalone Go1 platform.
At the opposite end of the scale, Typsy is targeting a specific niche of the workplace training market – hospitality training. Focused on making training fun, Typsy’s online platform is home to over 1,000 bite-sized training videos presented by global hospitality leaders. Catering for all areas of the hospitality industry, users can complete industry-endorsed certificate courses and add micro-credentials to their student profile to share with employers. At the beginning of the pandemic, Typsy launched its COVID Support Plan, offering unrestricted free access to its library of video lessons.
Of course, COVID-19’s disruption of the education sector can't be overlooked when examining the recent growth in Australian edtech and, more importantly, the future direction of the industry. Without technology, teaching and learning wouldn't have taken place in any meaningful way during 2020 and 2021. Online learning and assessment services, hybrid learning models and personalised support services were the big winners in terms of investment.
Looking ahead, edtech seems certain to continue to thrive, with some experts predicting that the industry is primed to become the new fintech. But exactly in what direction will this technological development take?
Extended reality (XR) technologies (such as virtual reality and voice interfaces) have already begun to be adopted by educators across all segments of the market. A study by Deloitte in 2020 found that 13% of edtech adopters were already using some form of digital reality technology. XR can provide students with a more immersive learning environment (such as being transported onto a battlefield for history class or simulating the consequences of a treatment plan in nursing school) without the expense of real-world consequences.
We touched on how edtechs are already utilising AI and analytics earlier, and this is another trend set to mature in the near future. In 2020, the Australian government committed to a $20m investment in a national AI and machine learning centre based at the University of Adelaide, indicating its desire to remain globally competitive in this market. Education will not be exempted from the broader societal trend towards personalised, data-driven services, so institutions will need to invest in analytics to remain in touch with student demands.
The dramatic increase in the availability and adoption of digital education over the past two years means it has never been easier to reach potential students. In order to remain competitive, institutions will need to streamline processes and cut out costly, time- and resource-consuming administration tasks. It's here that the worlds of edtech and fintech could well collide. In the same way paytech is helping the travel industry remove payment friction and the high cost of customer acquisition, edtech that addresses the specific challenges of education management will become increasingly popular.
Digital spend in education is expected to double over the next five years, reaching a total of $342 billion by 2025. With Australian companies making up just 5% of the global edtech market, it's clear there's significant room for expansion in the local market.
For more information on how Zai can help edtech companies capture new business in this rapidly expanding market, get in touch.
For more information about wider developments in the global edtech sector, download our guide below.