5 Challenges faced by EdTech Startups in building scale

With such a sizable market opportunity and domestic demand, it is only natural to expect a large number of startups and legacy businesses enter this space. […however] , with the exception of Byjus, edtech has a clear dearth of companies which have built a solid business, or a recognisable brand, let alone both.

Gaurav then goes on to enlist his top five reasons:

Large Number Of Service Providers

There is a saying, that in India, if you are one in a million, then there are twelve hundred others just like you.[…and therefore] school principals and managements are inundated with requests from service providers for the school to adopt their product.

How many ERP’s can a school use? How many Learning Management Systems can a school use?

He is spot on here, but we think the underlying cause is simply a lack of domain understanding by companies – on what education technology can do in schools. How many of the EdTech startups peddling ERPs and LMSs actually have people with sound knowledge of either school operations or cutting edge pedagogy? Products are built from a simplistic, outsiders point of view. We believe that there is still significant room for differentiation even within School ERPs (not so much in LMS, though given they are too narrowly defined). How many ERP providers understand and measure the key metrics that matter in running schools? How many allow for integration across other key products that schools will (or should be using)? They simply lack depth and rather intend to check all boxes and claim to be the one piece of the jigsaw puzzle that connects everything else together. That is simply not true.

Limited Access To Decision Makers

Schools have a number of stakeholders including the principal, heads of department, school management, and of course the school owners. There is no organised or structured method to first figure out who is the final decision maker in a given school, and then to reach out and start a dialogue with them.

This is absolutely right and something that needs to be solved for, if an edtech startup intends to build scale. The direct sales approach of approaching it school by school is simply too cumbersome, expensive and sometime draining on the companies resources. A few companies we know and admire have solved for it in differing ways, but the challenge remains and will be an integral part of a startups’ go-to-market approach.

Resistance From Teachers

While todays children are growing up in an environment where technology is ubiquitous we must keep in mind that a large number of teachers are still not very comfortable using technology in the classroom. Many teachers actually find technology to be a burden and adding to their already torturous workload.

We agree fully and would add a nuance on the 1/3rd rule. If a product is good then about 1/3rd of the teachers adopt it enthusiastically, another 1/3rd resist it actively and the remaining 1/3rd are fence sitters waiting to see if they really need to make the effort to learn and implement it. Success can lie in targeting the fence sitters and getting them to tip the scale in your balance, which means startups need to work directly with teachers – which very few do (or rather did in the past).

Resistance From Parents

In most cases, when the school is looking to implement a new product or teaching delivery tool, parents would be asked to shell out some money for the implementation and use of the product. Parents have become more and more skeptical of such moves by schools and with enough backlash from parents, schools have backtracked on their decision to implement new teaching-learning aids.

This is the bane of the non-transparent education ecosystem we have. Several schools don’t fully spend the time to plan a full integration of the tool with their pedagogical practices and hurry towards having parents pay for it (and then keep a cut of it for themselves). The payor will obviously ask “what am I paying for” and when the answer is not only unclear but actually borders upon ignorance, the reaction is both understandable and deserving. Some startups now try and directly interact with parents to drive the buy-in and again, this is an integral part of a companies go-to-market approach.

Benchmarking – Is Your Product Having An Impact?

No matter how much a parent, teacher or student likes your product, unless it is having a measurable and visible positive outcome, it will only be a passing trend. With education being such an important part of the Indian culture most parents are looking for ways to get a leg up on the competition. It pains me to see how many startups are not benchmarking their products against regular methods of teaching. Your competition is not just other edtech products, but is also the product/service/method you are trying to disrupt.

This is comes to the crux of the issue from the standpoint of the startup. We all think education is simple and we can solve for it sitting in-front of our computers, building a cool tool that is exciting and engaging (and often distractingly so).

Measuring learning outcomes and especially in-comparison to the alternative method appears like hygiene, but frankly its harder done than said. We aren’t a nation (or a breed) attuned to measuring outcomes in education, but for exams and marks and even the ‘alternative method’ is not well assessed for even a benchmark to compare against. Which is why we believe that assessment (of outcomes) and measuring other lead indicators is the best place to start building something worthwhile in this space.

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