The Market for Education Technology is Booming and Fueling a Wave of Learning Innovation!

On the heels of LinkedIn’s acquisition of Lynda.com (a leading online course provider) for $1.5B in April, news spread this week that Blackboard is seeking a $3B+ sale via an upcoming auction. This move comes just a few short years after Blackboard was taken private by investors in 2011 for a mere $1.64B, and at a time when the Advisory Board recently completed its acquisition of Royall & Company (student engagement and enrollment management solution) for $850M and when experts predict the global e-learning market will reach $107B this year alone. (Update: In addition, Instructure is also preparing for an $800M IPO).

Adding fuel to the education technology or “Ed Tech” fireball, three independent reports published over the past few weeks reveal that funding for education technology companies is at an all time high. According to the combined analysis, total investment levels for the first half of 2015 ranged from $1.4B to $2.5B (depending on the criteria used by each report).  This exceeds the total funding for all of 2014, creating a very positive trend for the future of online learning.

According to EdSurge, there were 161 EdTech investments around the world during the first half of 2015, totaling $1.59 billion. In spite of a few outlier quarters the investment pace is growing by approximately 20% quarter-over-quarter, while the latest research from CB Insights (I love their daily insight reports btw) reported that financing grew from $944 million in 2013 to $1.6 billion in 2014, a 71% increase. In the last four quarters, including Q2’15, Ed Tech startups attracted $2.3 billion, a jump of 96% compared to the previous four quarters.

The explosive growth in education technology funding over the past few years has, not surprisingly, mirrored a sharp increase in the acceptance of online education and the effectiveness of online tools that improve teaching and learning…such as the use of interactive video-based training and other innovative digital approaches. Just look at Kaltura’s “2015 State of Video in Education” report that shows that 91% of organizations believed that video had a positive impact on learner satisfaction and 82% said they thought the use of video led to better student achievement.

We see the positive impact online learning is having every day at ArcheMedX and recent reports from Transparency Market Research and the Accreditation Council for Continuing Medical Education show that online learning has indeed demonstrated a positive impact in patient outcomes and that increased demand for online learning will drive the continued growth for global medical education. In particular, the Transparency Market report predicts that we will see a rise in continuing medical education (CME) and new e-learning technologies that will dramatically accelerate the adoption of clinical best practices across the healthcare industry.