CEO & Founder @ refocus, VP Marketing @ Coding Invaders. EdTech enthusiast, investor, mentor and marketing expert.
When we talk about global fast food companies, the first thing that comes to mind is McDonald’s. Same with Facebook in social media and Nike or Adidas in sportswear. But what about edtech?
A lack of industry leaders to date means your educational startup still has a chance to go global and build something like Facebook for the edtech market.
It is predicted that the education market will reach worldwide $7.5 trillion by 2025 and already accounts for 6% of global GDP. The startups in this industry have the potential to shape a new global approach to education.
When starting a business, a founder should think about his BHAG (big hairy bold target). This is an ambitious goal for the next 10-25 years that will motivate employees, amaze customers and attract investors. For example, in 1990, Sam Walton stated that he wanted Walmart to have a… $125 billion company in the next 10 years. This goal helped Walmart become the largest retailer in the country. My own company’s BHAG has to become the first startup that comes to mind when it comes to online education. There is no point in investing effort, time and money in a project that does not have a global vision.
Based on my entrepreneurial experience, here are three tips for laying the foundation of an edtech company that could become a global industry leader.
Tip No. 1: Research the numbers of the market before entering it.
The growth potential is estimated in figures. The largest edtech market is in North America. While market growth estimates vary, Market Research estimates its value will increase to $88 billion by 2027, with a growth rate of 15.5%. The market is driven by the US and Canada, where there is high demand for educational technology products and services.
The second largest edtech market in the world is the APAC (Asia-Pacific region). Again, according to market research, this market will grow even faster, at a rate of 17.5%to $64 billion by 2027. Significant factors facilitating online education in the Asia-Pacific region include the phenomenal rise in internet and smartphone access rates, digital-friendly government regulations, and the growing demand for continuing education from working professionals and job seekers.
Once the market has been analyzed, it’s time to think about your place in it. In the case of my company, to understand the demand for our product in the Philippine and Indonesian markets, we examined the correlation between the number of vacancies in the digital field and the number of graduates in their specialty. We found that in Indonesia in particular, the number of vacancies per year far outweighed the number of university graduates, indicating that this market could hold great promise for us.
Tip no. 2: You benefit from an international team and a strong HR brand.
When exploring new markets, it is necessary to look for local specialists who know the local market, mentality and legal issues. Gartner’s Research shows that inclusive teams perform up to 30% better in high diversity environments. But for this to work, you must first develop multiculturalism within the company. Otherwise you will not win in the chosen market in the long run.
Working with an international team is complicated. Employees often work in different time zones, so without taking into account different schedules, you run the risk of employees not getting enough sleep and getting burned out. As a founder, I am convinced that work-life balance and comfortable working conditions should be paramount.
To pre-build the company’s HR brand, the founder must explore the mindset of each region and the local job market. Spend money consulting local professionals. It will certainly pay off.
The 2021 CEO Benchmarking Report of the Predictive Index claimed that: 91% of business leaders asked for advice on HR and talent strategy in the last six months of 2021. Every week I consult with various experts to keep track of all trends and to adapt to them. While some insights are repeated, I also gain a lot of valuable knowledge that improves business performance.
Tip No. 3: Choose your investors and business partners the same way you choose your life partner.
According to research by CB Insights 7% of startups fail due to disharmony between teams and investors. Therefore, choosing carefully those with whom you share your business. Founders who are only chasing money and careless in their choice of investors are making a big mistake. Be wary of investors who are only focused on startup income and have no interest in a global vision.
Choose those who share your values. Usually there are green flags to recognize them: they ask questions about the audience and the motivation and vision of the founders. They support your desire not only to sell courses, but to help millions of people find a new profession and change their lives.
If a founder of an edtech company sometimes disagrees with his partner about the product, but they both believe that education is the powerful engine for change in the world, they can work together. I can verify this based on personal experience. But if one founder measures success only in terms of money, and the other in terms of value to society, even if they both want to build an edtech giant, their paths are likely to diverge.
A great educational product is a combination of expertise, market selection, the art of recruiting and selecting strong partners and strong investors.
Because the education market is growing incredibly fast and offers many opportunities, it makes no sense to set small goals. Go in, be ambitious: strive to make a product on the same level as Google or Facebook and of course do your best to achieve it.