Education Week - Navigating the Ed-Tech Marketplace - S4

17%
DIGITAL REVENUE MARKETS
Platforms and
Administrative
Tools
41%
Instructional
Support
CONTINUED FROM PAGE S2
money into ed-tech companies with
the goal of generating returns.
Venture capitalists invested nearly
$1.2 billion in education and training
companies in 2013, nearly four times
the amount of five years earlier, according
to gsv Advisors, a Chicagobased
organization that consults
across the education and business
sectors.
While the largest portion of that
investment last year was in higher
education, a substantial chunk of
that money, $219 million, was focused
on K-12, more than twice as
much as was invested in 2008. (See
chart, Page S3.)
"There's no doubt there's increased
interest and activity," said Jennifer
Carolan, the managing director of
the seed fund at the NewSchools
Venture Fund, a nonprofit venturephilanthropy
organization based in
Oakland, Calif. "Venture capitalists
have always looked to new industries,
and to technologies that can improve
those industries.
Evaluating Investments
But some question whether enough
of that money is being directed to the
right places.
Matt Greenfield, a managing part42%
Content
Content
and instructional support were the largest market segments
based on extrapolated revenues.
SOURCE: Software & Information Industry Association
cational technology into classrooms
also raises questions about whether
the end-users of those tools, and ultimately,
students, are getting what
they need.
A nationwide survey released in
ner at Rethink Education, a company
based in White Plains, N.Y., that invests
in ed-tech companies, recently
wrote about how too many investors
are putting money into the same
products or services-he named digital
textbooks as an example-even
though many of those efforts will
inevitably fail in that crowded landscape.
Many other, potentially fruitful
investments get ignored, he said.
The problem is not the risk of an
ed-tech "bubble," as some claim, Mr.
Greenfield wrote in an online blog
post, but rather "there is a bubble in
ideas that won't work and a dearth of
capital for ideas that can work."
Deborah H. Quazzo, a founder
and managing partner for gsv Advisors,
disagreed, saying that thinking
amounted to "tilting at the wrong
windmill."
Ms. Quazzo, who also serves
on the board of education for the
400,000-student Chicago public
schools, said the flow of investment
supports a diverse range of ideas
and products, mentioning support for
teachers as an example.
"Not every investment is going to
work," she said. "You're going to bet
on different management teams and
different ideas." But while the market
is certainly prone to "bunching," she
said, "you'll see a very big spread of
people covering large areas."
While many of the ed-tech companies
receiving venture capital will fail,
the willingness of investors to gamble
on them will almost certainly spark
innovation, Ms. Carolan argued. For
years, many venture capitalists interested
in technology focused on
the consumer market and ignored ed
tech, she said. That meant many edtech
startups lived or died based on
their ability to have immediate success
selling to K-12 schools, a notoriously
insulated market, she said.
Now, "venture capital will help
bridge that gap," Ms. Carolan said.
Educational technology "is a space
that has been undercapitalized."
Others note the rapid flow of eduApril,
for instance, showed that educators
regard only about half of the
digital devices their students are
being asked to use in schools as effective.
The
survey, commissioned by the
Bill & Melinda Gates Foundation,
found that teachers are especially
eager to find products that will help
them with the common-core standards.
Yet their satisfaction with
those tools in meeting that need was
mixed at best-and they saw the
performance of resources in certain
areas, such as elementary-level English-language
arts and high school
mathematics, as especially weak.
"The absence of useful market
information has led to a mismatch
between the kinds of digital instructional
tools that teachers say they
actually need," the report concluded,
"and the kinds of products companies
are creating and districts are buying."
Many of the biggest changes in the
K-12 ed tech market have occurred
because of the growth of mobile devices
such as smartphones, tablets,
and netbooks, and the related upswing
in the market for digital content
and tools, said Karen Billings,
the vice-president of the education
division at the Software & Information
Industry Association.
The growth of mobile "has changed
the landscape for developers, for instructors,
and for students," she said.
Many districts around the country,
meanwhile, have embarked on costly
and ambitious technology projects, in
some cases meant to give each student
a computing device, or at least
dramatically expand access to online
tools. One of the most high-profile,
and much-criticized examples is
playing out in the Los Angeles Unified
School District, which is rolling
out plans to provide all the system's
641,000 students with digital devices,
with preloaded curriculum produced
by Pearson.
At the same time, while a lot of
school officials are keen on making
the leap from print to digital materials,
many are in fact moving "very,
very slowly" on that front, added Ms.
Billings, who said siia has surveyed
district officials on the topic. The
reasons vary: some districts believe
some print content can still be delivered
more effectively and equitably
than tech-based lessons; others have
said parents favor the familiar, print
model, she said.
When it comes to choosing among
PAGE S6 >
With the right
kind of
screen time,
they might just
see the arts
in a new light.
S4 | NAVIGATING THE ED-TECH MARKETPLACE
EDUCATION WEEK * June 11, 2014
July 2013
NEW
OPPORTUNITIES FOR
INTEREST-DRIVEN
ARTS
LEARNING
IN A DIGITAL AGE
BY KYLIE PEPPLER
A Report Commissioned by
New Opportunities for Interest-Driven
Arts Learning in a Digital Age
Digital technologies are offering young people new ways
to engage in the arts on their own time and according
to their own interests. This report describes the new
technologies, young people's media use and a framework
for thinking about "interest-driven" arts learning.
These and other free resources are available
at www.wallacefoundation.org.
> www.edweek.org/go/edtechmarket
http://www.wallacefoundation.org http://www.wallacefoundation.org http://www.edweek.org/go/edtechmarket
Education Week - Navigating the Ed-Tech Marketplace

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