Markus Aurelius said that the first step of understanding anything is simplicity; he proposed that one should understand the nature of something before dwelling on it. So going by the words of one of the most renowned philosophers in the world, let us understand what is ed-tech or educational technology.
Breaking it down to its simplest form educational technology usually involves the use of computer software and hardware along with teaching pedagogies to facilitate and enhance the learning experience. The ed-tech industry is quite a niche market and its demand has been rising in recent years. so if you are someone who wants to build your own edtech company here's how you can get started.
Research the Market
While I was researching this topic, I understood that many renowned personalities in this field have suggested first understanding the ed-tech market. For example, before the pandemic started, the US ed-tech sector received 1.66 billion in investments, which is the highest in 5 years.
While many industries were at a disadvantage due to the pandemic, ed-tech companies raised an astonishing 16.1 billion USD. Knowing the market, its demands, and other things like that would ensure any suitor in this sector scale the evidence and weigh the facts.
Narrow Down and Validate Your Idea
You need to understand the concept of divide and conquer when it comes to ed-tech. The ed-tech market is too vast and ever-changing for a single entity to rule over.
The first step is to critically and objectively view your own idea. Find out whether your idea serves the customer's needs and itself is unique. This will also go on to indirectly help you predict the market, discover the trend of your niche, and identify your competitive advantages.
It may look tempting to start your own ed-tech company when I put it across in such simple terms but we need to understand the problem of validity because before you propose any idea you have to ask yourself these 3 questions,
- Does your idea solve a problem that is troubling a lot of people or improve a system that is quite essential in this specific area?
- How do you know that you are solving a problem?
- Do you have enough data and research backup to support and pitch your idea?
Define Your UVP and Choose the Right Business Model
Any business requires a UVP or a unique value proposition. What can you offer that other companies can't? Your unique value proposition can be constructed by 3 crucial things,
- The value that is delivered by your product.
- The customer base that you would like to target.
- What is the approach you are adopting to sell your product in this highly competitive market?
The right business model must follow your UVP. A business model usually entails how your ed-tech startup will achieve its goals and earn its revenue. It also describes the main highlights of your product and how it is going to create value for your customers.
You can experiment with a number of business models. Certain business models usually are taken up with the intention of rapid growth and the capture of large market shares, whereas certain others would usually involve selling products to institutions and monetizing your customer base from the beginning.
My advice to anyone who is interested in this area would be to choose a business model that helps you build a sustainable and independent business around a challenge or problem that you are trying to solve.
Build the Perfect Team
The right team is necessary for any business to succeed. In the highly competitive ed-tech industry, one needs to have the right team for even his/her idea to even come into consideration in front of investors. The best way to address this problem is to hire a group of professionals who are passionate and have an experienced background in education, which acts as their primary motive and the monetary benefits as their second priority.
Try to build a team that can help you create a scalable monetization model and a go-to-market strategy for your product. Being an ed-tech company's CEO is definitely a different experience. You should start engaging in educational conventions, start visiting your local schools and understanding their learning demands and start talking to other individuals who are involved in the same business.
Being a startup in the initial stages would usually mean that you would have to work with minimum revenue. It is always better to work with an outsourcing company than pay an in-house team of engineers.
The need to have a skilled CTO - an individual who has the experience and expertise to work on the design of your product and oversee your development team is key to progress.
Have a Proof of Concept/MVP
Theoretically, it is easy to pitch any business idea. Practically every aspect of the product will find it difficult to serve and deliver to different demands of the real world. The best way to resolve this issue would be to build a proof of concept.
By building a proof of concept, you would have a strong base to validate your idea on a minimal budget. This application would usually involve the most important functionality or risky features of your product. Fancy design should not be used here to dazzle users.
Minimum viable product (MVP) works on similar lines with proof of concept. Proof of concept usually involves proving that your product will work in real life but whereas an MVP ensures that your customers are satisfied and pleased with your product.
Finally, in conclusion, we can say that by following these steps, you may have the perfect start for your company, but we should all remember consistency is key for any business to become better. With thorough research and strategy, any business can become successful and so is the case with ed-tech.
How does EdTech make money?
Usually, edtech companies make money by selling their courses to students or schools. There are also companies that provide their courses for free but charge a small fee for the certificate.
How do you get funding for EdTech startups?
First, you need to prepare a solid business plan and then you can approach angel investors or VCs to pitch your idea and receive funding.
What is the future of EdTech in India?
India's EdTech industry is growing at a really fast pace and is expected to reach $30 billion in the next 10 years.