To come to the second question of why higher education edtech companies - be it UpGrad, Emeritus, SimpliLearn, Great Learning - seem far more insulated is primarily because the value proposition and/or the mode of delivery have seen little change pre and post pandemic. Most of these companies offer acquisition of skills or upskilling that improve employability. While many of these players too have diversified into related areas, they have done it in a far more thoughtful and circumspect manner. Most of their buys have been to fill existing gaps as well but in most cases it was to harness and unleash the energy of the founder or promoter of the businesses they have acquired rather than hiring a senior manager to develop it from scratch. The drive, passion and vision that the founder brings can rarely be replicated through a high paid hiring.

Another reason why higher ed edtech players don’t face the same problems as K-12 is their market reach and accessibility. Many of the players can offer their programmes and courses across the globe with equal ease as syllabus or language barriers are far lower. Players like Simplilearn and Emeritus have 60% and 75% of their present learners overseas. This is also a luxury K12 doesn’t enjoy since children typically follow the national curriculums and pedagogies and these vary widely across countries.

In fact many of the Indian higher ed edtech players have reported their highest growth and in many cases profits in 2022 although profitability remains elusive for most. Many of them claim that making money and turning profitable remains well within their grasp - as close as next financial year - but analysts and observers say they could be counting their chickens well before they hatch. But no matter how one looks at it, this space does appear to be staring at a more optimistic future than their K12 counterparts.

Last but not the least, there is one factor that always makes children harder nuts to crack. Children are by nature more fickle and harder to discipline than those in the age groups that the higher-ed players are targeting. Getting a child hooked and remaining there is a Herculean task as any parent will testify. Word of mouth only takes you so far unlike with an adult who sees his contemporary better his situation after finishing an upskilling course or learning a new one. Neither are children interested in keeping one with the Joneses especially when it comes to learning math nor are they beset with anxieties for the future to the same degree. This ensures that the cost of acquiring and retaining a new learner is much higher for the K12 space. A recent survey by L.E.K, a consultancy firm and DC Advisory, an international investment bank, found that only 30 percent of the parents say they are likely to renew their subscriptions for such content. Suffice to say that this is the nature of the beast and partly explains why this segment finds itself in a rockier boat.

In the final analysis, the gloom and doom that currently surrounds the K-12 players may worsen in the short run and many expect it to eventually lead to a separation of the wheat from the chaff. Those that survive this churn may well be the fittest of the fit.

Online learning platforms

Edtech had a great fall! Can they put it together again?