Is this the end of Edtech's honeymoon?

Itʼs inevitable that periods of enormous growth donʼt continue forever, though itʼs still somewhat shocking when it ends. Edtech hasnʼt been immune to the ongoing downturn.

In our latest report "The evolution of Edtech: activity in private and public markets," made in partnership with Brighteye Ventures, we're seeking to understand how edtech markets have evolved over time and contextualize what we’ve seen so far in 2022.

Key findings:

The market caps of public Edtech companies have been slashed since the start of the year, down almost 50% compared to the end of 2021. However, publicly traded value represents a fraction of the overall Edtech sector.
After last years’ IPO fever, public exits have almost entirely frozen this year, but M&A activity has already surpassed levels seen in 2020.
Global VC funding into Edtech startups totaled $7.6B in the year to September 2022. This represents a pullback on the equivalent point in 2021, largely due a drop in late-stage rounds.
Europe leads investment growth in the first half of 2022, attracting a larger share of global Edtech funding (21% in H1 2022 compared to 12% in full-year 2021). However, some correction might be underway for the European Edtech ecosystem, with Q3 results showing a considerable decline.

Access the full report and you can also explore insights on innovation happening in edtech related to all learning ages, from corporate learning, age-learning to higher education.

The Evolution of Edtech | Report

In other news:

🏫 Why we’re heading for a crisis in Higher Education. Are higher education institutions ready to face the undergoing changes in students' demands? Some argue that institutions' sluggishness is leading to an increased number of young people seeking other alternative forms of higher education. - LinkedIn

📉 The job market is a problem for Harvard, Wharton, other Top M.B.A. Programs. Applications for elite MBA programs in the US are down significantly this school year. A hot labor market and cost of the degrees are two of the main factors driving this trend. - WSJ

📖 Edtech’s honeymoon might be over, but expect a second boom. Together with Brighteye Ventures, Dealroom dive into the key findings of our most recent report. Key takeaway: Edtech's first boom might be over, but the market remains a massive underinvested opportunity.

Latest edtech deals

The largest deals:

🇺🇸 Ocelot, a startup developing a texting and chatbot solution for students, raised a $117M Growth Equity VC round from K1 Investment Management.

🇺🇸 Education management platform TeachFX raised a $10M Series A round led by Reach Capital.

🇺🇸 Fizz, a social network for university students, closed a $4.5M Seed round, led by its own CEO, serial founder Rakesh Mathur. Other investors include Lightspeed, Octane and other angels. The app is used by 95% of Stanford undergraduates and it aims to expand to more than 1,000 campuses by the end of next year.

🇺🇸 Halp, a New York-based international college admissions coaching platform, raised $4M in Seed round, led by Lerer Hippeau and Serena Ventures with participation from N49P, Shed Capital, Gambit Partners, and several angels.

Other notable edtech deals:

🇺🇸 Boddle, a game-based learning platform for K-12 raised a $3M Seed round from KCRise Fund, Lightship Capital, Atento Capital, and ACT Ventures, and several angel investors.

🇳🇴 Ludenso, an immersive tech solution for the education industry, raised a $1M Seed round.

Read up on all the latest edtech deals in Dealroom.co.

Notable exits:

🇺🇸 Duolingo acquired Gunner, an animation studio, for an undisclosed amount. This marks Duolingo's first acquisition with more underway.

Read up on all the latest edtech exits in Dealroom.co

Tip of the week

🏆 Dealroom Signal Top 100

We’ve ranked the top 100 startups for 6 different industries to watch based on our Dealroom Signal: a powerful algorithm helping VCs, Corporates and Governments find the most promising up and coming startups.

Explore the top 100 startups of 6 verticals built by our data-driven algorithm. 👈

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Carla Napoleão

Innovation Analyst
Dealroom.co

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