Blog post by Dana Harris, Partner, Red Javelin Communications

At the LearnLaunch Across Boundaries Conference 2016 last month, the “Investors Speak: Looking for the White Space” panel explored which education pain points are attracting major investor attention and provided insight on trends that prominent investors are seeing in the various edtech marketplaces now.

The panel session was moderated by Elizabeth Chou, Partner, New Markets Venture Partners and included Aanand Radia, Vice President, University Ventures; Rick Segal, Managing Partner, Rethink Education and Jennifer Lee, Principal, Learn Capital.

Panelists emphasized that it is a great time to be in edtech and discussed areas of focus by edtech investors, including:

  • Addressing the skills gap
  • Helping students transition from college to the job market
  • Online higher education
  • Developing effective blended-learning environments for K-12.

Investors on the panel emphasized that they see many companies working on similar things. To stand out, entrepreneurs must: (a) Have a mission – a real problem and a unique solution, as well as product-market fit; (b) Be able to express why their product will move the needle forward; (c) Identify users that will adopt the solution, and (d) Show customer adoption, rather than reference big-picture market statistics.  Being able to show a real return on customer investment is important.

Panelists encouraged early stage edtech entrepreneurs to develop a clear way of showing success. Investors look for metrics such as number of clients, market adoption rates, and user statistics. While developing these analytics can be a lot of work for an early stage startup, going through this process is critical for company growth. Entrepreneurs should develop a relationship with investors, share their company metrics and ask for feedback.