EdTech in the US: An Impact Perspective

In April this year, we attended the ASU GSV Summit in San Diego, considered the "must-attend event for education technology investors" (The New York Times).

As an impact investor, it was great to see a large number of EdTech businesses trying to solve some of the significant challenges facing both K-12 and tertiary education - from addressing the 'completion challenge' in tertiary education to improving engagement and achievement in K-12 education.

Here are our key take-outs from the ASU-GSV Summit:

K-12 Education

1. Fundamental structural problem in the K-12 school system

65% of high school graduates continue to college. This is declining
Does the workforce need more college graduates? Technical skills shortage
School system is primarily designed as a 'filtering process' for colleges
But, what about the 35% of students who don’t go to college?
School system needs to better prepare students for the workplace
Integrating work-related skills and behavioural competencies is critical
Big focus on changing the way we teach… the adaptive revolution

2. Adaptive learning explosion…

There are now 22 vendors of major Adaptive Learning Solutions (ALS)
Acknowledge the critical role of teacher engagement in ALS
Problematic issues with definitions (potentially undermine efficacy)
Early stage, limited system-wide data on efficacy
Investment in admin systems still 10x learning systems
A number of providers moving from maths into literacy and English

[endif]

3. Digital literacy challenge

The digital literacy and STEM skills challenge is real
This is creating critical workforce shortages in technical areas
Significant issues with curriculum and lack of inter-disciplinary approach
Acknowledge the challenges of teacher professional development
Significant role of parental attitudes towards STEM careers
There remains a significant gender gap in learner attitudes

4. Companies and organisations to watch

No Red Ink – adaptive learning for reading and writing
Think Through Math – adaptive learning for maths
Literacy Design Collaborative – Gates Foundation
Bloomboard & Edthena – teacher professional development
Light Sail – accelerated literacy development
Learn Zillion – content repository for teachers and schools
Wyzant – connecting students and tutors
Mastery Connect – learning platform based on ‘mastery learning principles’

Higher Education[endif]

1. We don’t ask ‘is there a higher education bubble’, we ask when is it going to burst.

‘A degree is the surest ticket to middle class’ Obama. Is this accurate?
Graduate employment rates declining
Graduate starting salaries declining
Prices increasing – 7.3%, higher than real estate prices in the ‘bubble’
$36k average debt on graduation, 43% of students in default
45% of graduates said that there current job did not require a degree
Demographics are working against the system – fewer students
Companies are losing trust in the system (see below)
Disaggregated data is worse

2. Tertiary education in the US has a ‘Completion Crisis’

41% of higher education students don’t complete
Only 20% of community college students complete
Enormous economic and social cost to non-completion
Spurring a new range of ed-tech innovations
Focus on learning barriers & psychological barriers (Get Set, Inside Track)
Focus on harnessing data and predictive analytics (Civatas)

3. Lack of connections between education and employment

Clear disconnect between workforce needs and graduate outcomes
Lack of focus on the entry level skills required to secure a job
Mismatch between federal funding (accredited training only) and industry requirements (often unaccredited, skills targeted learning)
Big shift in competency-based training in higher education

4. Rise of online as the preferred delivery mode… and asynchronous