INSUBCONTINENT EXCLUSIVE:
Education is a $4 trillion market globally in urgent need of overall — so where within education are top venture capitalists optimistic
about startups building large businesses by providing new solutions?
According to EdSurge, $1.45 billion of venture capital (a mere 1.1% of
the $130 billion in US venture funding) was invested in education startups in the US in 2018; there were only 112 education-focused deals
In line with the trend in venture capital overall, this represented an increase in overall capital but a concentration in fewer deals
(mainly large late-stage rounds).
Education is regarded as a tough market for achieving VC scale returns
Selling into school districts and universities is difficult and slow, and freemium models that go direct-to-teachers have struggled to
monetize.
New software, content, and financing solutions for learning outside the traditional school system are more compelling business
This is particularly the case in vocational training where the return on investment of an educational program or tool can be quantitatively
measured in job offers and salary increases
I asked four leading edtech VCs and six of the top generalist VCs (who have a track record of
education investments) to share where they see opportunity in this sector:
Jennifer Carolan, Reach Capital
Amit Mukherjee, NEA
Michael
Staton, Learn Capital
Annie Kadavy, Redpoint Ventures
Aydin Senkut, Felicis Ventures
Matt Greenfield, Rethink Education
Hemant Taneja,
General Catalyst Partners
Marlon Nichols, MaC Venture Capital
Jan Lynn-Matern, Emerge Education
Charles Birnbaum, Bessemer Venture
Partner
Here are their answers…
Image via Getty Images / doyata
Jennifer Carolan, General Partner at Reach Capital (an education-focused
VC firm in Palo Alto with investments including Abl, BetterLesson, Epic!, Handshake, Holberton School, Newsela, Outschool, and
Tinkergarten):
Human-centered learning has been traditionally limited to one physical geography but technology is unlocking learning
opportunities that never before existed
We&re particularly interested in the marketplaces that are better matching supply and demand across experiential learning, educator
coaching, tutoring, and online small groups.
