These 5 key trends will shape the EdTech market upto 2030

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Malvika Bhagwat, Partner and Head of Outcomes, Owl Ventures

• The global education sector will see expenditure of $10 trillion over the next decade.
• EdTech, a rapidly growing and dynamic part of the wider education economy, is set to play a key role in this market.
• As EdTech continues to grow, thanks to Artificial Intelligence and other new technologies, five key trends are shaping the sector.

As the digital revolution accelerates, education technology (EdTech) will leave an indelible mark on lives and economies all over the world.

From filling in gaps in the workforce to the growing emphasis on mental health in education, technology is changing and enhancing the educational sector worldwide. And this phenomenon is touching all learners — whether that’s a child newly entering school or an adult learner seeking to upskill for the job and careers of the future.

The next 10 years will see 800 million K-12 graduates and 350 million post-secondary-school graduates globally, and expenditure on education around the world is set to hit $10 trillion by 2030. In that growing global education ecosystem, Edtech is set to play a critical role.

5 emerging trends in EdTech

As the sector evolves, five key trends are emerging. These trends are already shaping the world of EdTech and education — and will continue to do so for years to come for hundreds of millions of people around the world.

1. Upskilling: Training the workforce of the future

Inexorable rise of automation, Artificial Intelligence (AI) and digitization is reshaping the job market. As a result, upskilling and reskilling the workforce have become imperative. According to the OECD, nearly 1 billion jobs worldwide will undergo significant changes due to technology within the next decade.

Public sentiment indicates that traditional higher education often falls short, emphasizing the need for accessible, flexible learning solutions. With a surge in demand across all tiers of the job market, platforms like Degreed, Interplay Learning, and Workera — all EdTech enterprises — are becoming pivotal in empowering individuals for success in the swiftly evolving job market.

This trend, of people using EdTech platforms to upskills for a changing job market, shows no signs of abating.

2. AI: Revolutionizing learning experiences

AI is ushering in a new era of education, offering personalized and efficient learning experiences. AI in the education market is set to skyrocket, with estimates predicting a global increase of approximately $21 billion by 2028.

AI is being implemented in essentially every education technology company and will have a profound impact on business models and learners. Innovative solutions such as Amira Learning, Sizzle AI and Workera AI are market leaders in using AI in education, leveraging AI to provide 1:1 support, skills intelligence and enhanced productivity, revolutionizing education.

3. Talent: Drawing new talent to EdTech

Digitization and AI have unleashed top-tier talent into the EdTech sector. Accomplished professionals from tech giants are founding EdTech companies, recognizing the immense potential of this market. Entrepreneurs like Kyron’s Rajen, Sizzle’s Jerome Pesenti and Maximal Learning’s Eran Megiddo bring a wealth of experience to capitalize on the opportunities and forge new innovations in the EdTech space.

4. Mental health: Shaping well-being

As the world transitions beyond the pandemic, the spotlight on mental health support in education is intensifying. Alarming statistics from the CDC’s Youth Risk Behavior Surveillance Data underscore the urgency of the matter. Organizations like Hazel Health, Panorama Education, Thrive Global and Woebot, dedicated to addressing mental and socio-emotional challenges facing K-12 students and promoting healthier, happier lives are truly at the forefront of this work.

5. Outcomes: Prioritizing impact measurement

In the EdTech sector, the prioritization of impact and outcomes is critical. It is essential for building enduring businesses and driving effective education. Without robust outcomes data, assessing what works for end-users is challenging.

In K-12 education, a lack of data on product implementation and outcomes leads to districts trying an average of 2,591 EdTech tools annually, hindering efforts to address ongoing and pandemic-induced learning loss. Similarly, in workforce training, the US spent $101.8 billion in 2023. In today’s market, where there are millions of unfilled jobs and more that need to be upskilled, understanding the impact of investments is key.

To dig deeper into the importance of impact measurement, read the 2023 Education Outcomes Report by Owl Ventures.

Measuring impact in EdTech

Prioritizing impact and outcomes is paramount for building enduring businesses in the education sector and beyond. Owl Ventures, which specializes in investments in the education sector, measures success across three pivotal dimensions: scale and access, diversity and outcomes.

Scale and access

EdTech companies must delve into customer profiles, fostering products designed to scale without excluding high-need communities. How this looks can depends heavily on the learners companies are focusing on.

For companies engaging with schools and districts, for example, metrics such as the percentage of students qualifying for Free and Reduced Lunch and English Language Learners serve a pivotal role. Direct-to-customer companies, however, focus on tracking access through parameters like the number of parents and communities served, geography, product price points and device accessibility.

Outside of the US, factors such as household income, geography or religion might play more of a role, and companies must report data on urban and rural populations, income levels, gender and age ranges.

Fostering diversity

Companies embracing gender or racial and ethnic diversity are 36% more likely to outperform industry medians. Diverse teams consistently demonstrate superior decision-making capabilities, highlighting the importance of inclusivity.

It is vital that companies working in the education sector conduct annual diversity surveys to capture metrics such as gender, race, pay equity and employee retention across all leadership levels to ensure that the diversity of the populations they serve is reflected in the organization building solutions for them.

Tailored outcomes

Recognizing that each EdTech venture tackles a distinctive challenge within the education sector, identifying and measuring specific outcomes aligned with the product’s objectives is a worthwhile exercise for companies and their stakeholders.

In the Pre-K-12 sector, for example, measurement of impact may range from student achievement on standardized tests to socio-emotional skills developed, showcasing the diverse outcomes in this sector. While in post-secondary and career mobility functions, metrics like graduation rates, scholarships received and job-placement numbers are more relevant for tracking outcomes.

In essence, the future of edtech and high-quality education lies in answering a fundamental question for education technology companies: Does the solution bring about a positive outcome for its intended users?