Austin, Texas

Investors and proponents of educational technology development on a SXSWedu panel this week offered glimpses into how demand for ed-tech is shifting in different markets around the world, offering implications for both startups and established players.

One thing remains clear: There’s still a ton of interest in K-12 tech emerging from the United States. About 25 percent of education technology companies are U.S.-based, but they attract about 70 percent of investment, said Avi Warshavsky, the CEO of MindCET, an ed-tech innovation center and accelerator based in Tel Aviv, in kicking off the conversation.

His organization was instrumental in running the 2016 Global Ed-Tech Startups Awards, a competition that attracted 1,000 companies from 70 countries. Of the total entries, 281 companies were U.S.-based; 82 were from Colombia, 73 from the U.K. and 55 from Israel.

But there were other countries represented where the organizers did not necessarily expect to see ed-tech activity, said Warshavsky. That included startups from the Ivory Coast, Algeria, Egypt, Serbia, Venezuela, Costa Rica, and Vietnam. (Here’s a map of the K-12 startups.)

Chicago-based Edovo won the award, which was announced in January in London, just before the Bett conference. Edovo is tablet-based software designed to educate and be part of rehabilitation for people who are incarcerated.

From China to the World

Vincent Fung, an investment director at China-based NetDragon Websoft Inc., said ed-tech attention is focused on the United States, China, and India, partly because of the size of those markets, which serve 55 million, 221 million, and 253 million students, respectively. In China, there’s a $1.17 billion annual investment in ed-tech, he said, spending that is partly government driven.

Fung said his company is “looking beyond China, and we’re seeing a lot of opportunities in India, Southeast Asia, and Africa.”

In India, NeDragon Websoft is focused on private schools because government schools lack incentives and funding for educational technology, Fung said.

“We’ve knocked on a lot of doors,” going from one private school to another, he said. He said the company decided that the “most efficient way to distribute the technology and content is on a mobile [phone] platform,” he said. “We made a decision to partner with mobile payment company to do education.”

Global Learning XPRIZE

“There’s clearly a marketplace that goes beyond the U.S., Canada, and the OECD countries,” said another panelist, Matt Keller, the senior director of the Global Learning XPRIZE. He was referring to nations outside of the 35 industrialized ones that belong to the Organization for Economic Cooperation and Development.

The prize is sponsored by Elon Musk, the founder of PayPal, Tesla Motors and SpaceX. It challenges teams from around the world to create innovative technologies that will bring children—on their own and with each other—from non-literacy to literacy in 18 months in places where quality learning environments are difficult to access. The incentive prize is designed to have students teach themselves skills using tablets, or to teach one another, without traditional learning communities led by teachers.

“When you see the enormity of the challenges teachers face” in those communities, with “100 kids in a classroom, 150 kids—technology is the only thing that can scale in a way to make a difference in the life of a child,” Keller said. “This is not about supplanting teachers, it’s about supplementing what’s out there. What’s out there is not enough.”

The five finalist teams developing the new ed-tech must release their products as open source code and content, to encourage the sharing of ideas based on their technologies, Keller explained. “The teams that are competing are a wildly eclectic mix of people from around the world,” he said, “all of whom are doing so because they want to be part of something larger than their own self-interest.”

Sorting Sound Ed-Tech From the ‘Flim-Flam’

While demand for ed-tech is booming in many markets, it is not always effective, and some schools are cautious, the panelists said.

“There’s still a lot of flim flam out there, trying to sell stuff that isn’t interesting and doesn’t work,” he said. When governments see proof that ed-tech works, they will begin to invest in it, predicted Keller. “That will help in places like India and elsewhere,” he said.

Going global will be a necessity for some ed-tech companies that need markets outside their home countries to survive. Based on what he sees in Israel, Warshavsky said, “We’re facing every day the challenge of being a small country, having great startups that have bigger potential than just in Israel—and knowing that each of those startups should think about going global from day one.”

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See also:

• Chinese Gaming Company to Acquire Ed-Tech Provider Promethean
• International Ed-Tech Opportunities, Challenges Focus of Ed-Tech Forum
• XPRIZE Launches New Tech Competition Focused on Global Education
• Incentive Prizes Can Be Designed to Generate Education Solutions, Report Says