Mega deals in the telecom sector took center stage this year thanks to monster-sized capital inflows from foreign investors but another industry-defining trend being forged even as it saw velocity pick up is that of education.
The volume of funds going to educational technology (ed-tech) companies jumped four times to over $2 billion compared to $550 million the year before, according to reports by Indian venture capital associations. (IVCA and PGA Labs). Yet a cursory look at the sector's history wouldn't have shown such potential.
Two movements drove its non-linear growth. First, the recent closure of schools and dependence on distance-learning meant wide-scale digital transition was inevitable.
Second, is the sheer size of the education market valued at over $100 billion with a community of over 350 million learners, and projected at annual double-digit growth rates with potential to double by 2025 meant one thing. No investor could ignore it. While that's good news, notes of caution apply.
For starters, the cycle of learning now extends beyond recent graduates looking for quick skill upgrades. Second, a new economy and meshing of multiple skills, meaning employment, will be driven by 'gigs" and learning will be constant.
But measuring new training driven by ed-tech will face performance-driven metrics employers expect from the likes of management schools like IIT, IIM, and XLRI. The ROI (return on investment) on educational courses, career outcomes, and placement post-training and skilling are in areas that will be judged not just by companies -- but those taking the courses as well. Those numbers must ring true if the hype is to keep pace with reality.
Further, what must follow naturally is a re-definition of higher education. Is it the traditional MBA-style management courses or ongoing curriculum that enable mid-stage or even late-stage employees to reskill themselves and pivot given that the age of the single job career is over?
The average worker's number of jobs in a lifetime now ranges between five and seven and will climb much higher given half of the top jobs of 2025 haven't been created yet.
India made the most of the IT revolution and set itself up as an international hub for technology. It's now time to do the same in a world where artificial intelligence, machine learning, and digital are not just passwords for success but also survival of any economy.
The National Education Policy is mulling reintroducing a four-year undergraduate degree. The extra year allows for academic combinations and permutations and while some may decry it, new learning frameworks are always a step forward.
They would be a giant leap ahead once they make the infrastructure online. That education will see more unicorns and companies listed than other sectors in the future is a strong likelihood given the strong revenue opportunity that it offers.
One could, along with religion, cricket and Bollywood, also add education to what comprises the holy grail of this nation. The future success of ed-tech players, however, will hinge on smart unit economics as well as the future success of their consumers.
Making ed-tech successful will require a digital infrastructure that could become the most impactful (PPP) Public Private Partnership that the country has seen. That alliance could catapult India into becoming a digital classroom and the rest of the world students in it.
(The author is Chairman & Co-Founder, upGrad.)