WHERE IS

INVESTMENT FLOWING IN
EDUCATION TECHNOLOGY?
Venture capital investment Technology holds enormous promise for education. It can:
in education technology
(ed-tech) has soared
over the last five
years. A breakdown of the personalize increase access engage the achieve scale
spending over time reveals and enhance
student
to a high-quality
education
disengaged at lower cost

pockets of intense attention learning

as well as areas of dramatic
concentration. Understand-
ing these patterns will help $4.5 $ 32%
investors and companies billion Compound annual growth
rate (CAGR) for total private
chart their future course. Total private investment investment in ed-tech from
in ed-tech in 2015 2011 through 2015

A network analysis of the

connections between
individual ed-tech
WHERE DID THE company investments at
MONEY GO? three points in
time shows growth in
segments of the market.
Large, dense clusters of
the same color indicate
segments receiving a high
degree of investor
INVESTMENTS ARE attention.

GROWING MORE 1995 COMPANIES

781

CONCENTRATED… Early players include providers and

distributors of digital content.

…by segment of the market

Number of Private investment
companies 2011–2015
in 2015 (CAGR)

Multimedia content $2.3B

delivery and platforms 343
(34%)

Online courses and $1.9B

tutoring 421 (19%)

Business management $1.9B

and financial 179 (127%)
technologies
Systems management,
2005 1,587
COMPANIES
$1.5B
security, and 305 Emerging areas include blended
(10%)
infrastructure learning and LMS tools and business
management and financial technologies.
Higher education
programs and services 222
$0.8B
(49%)
64%
of investment

Blended learning and $0.8B

learning management 433 (20%)
system (LMS) tools

Language and literacy $0.7B

programs 125 (97%)

Academic-standards- $0.7B
based and Common 331 (100%)
Core programs

Adaptive curricula and $0.6B

92
machine learning (46%)

Social platforms and $0.5B

56
learning communities (7%)
2015 3,163
COMPANIES

Programs for special- $0.5B Games, social platforms and learning

needs populations 103
(–1%) communities, and language and literacy
programs emerge.
Career and vocational $0.4B
133
education (27%)

Games $0.2B
112
(–6%)

Providers and distri- $0.2B

butors of curricula and 294
(–3%)
educational materials

14 <$0.1B
Interactive stimulators
(–100%)
and sensors

INVESTMENTS ARE
ALSO GROWING MORE
CONCENTRATED...

…by sector …by country

The preschool through secondary school
Private investment (2011–2015) 97%
(Share of total investment) of investments were
market has received the most investment concentrated in
5
from 2011 through 2015, but higher
education has grown the fastest as a
percentage of total investment, led by rapid
growth in online learning and business US Canada countries
management and financial technologies. $10.1B $0.4B
(77%) (3%)
UK India China
Share of total investment
$0.2B $0.6B $1.2B
(Private investment) (2%) (5%) (10%)

2011
50% 11% 20% 19% <1%
($736M) ($161M) ($289M) ($288M) ($4M)

2015

3
Preschool Alternative
Adult
OUT 4 DOLLARS
through school
secondary learning 2%
school 14% ($102M) went to US ed-tech companies from 2011 through 2015
35% ($629M)
($1,608M) Higher The rest of the world faces major challenges—and
education Other institutional
19% important opportunities—in catching up to these
30%
($1,348M) ($857M) leading recipients of ed-tech investment.

HOW TO NAVIGATE
THE FUTURE OF
EDUCATION TECHNOLOGY

Place focused bets Embrace blended Grow strategically

Invest in areas of the learning Scale up projects in
market where education Connect the virtual one geographic area
technology can achieve a and physical worlds in before considering
balance of lower costs and ways that measurably international
improved student improve learning. expansion targeted
outcomes. to local needs.

NOTES AND SOURCES

This infographic is based on BCG research conducted as part of New Vision for Education: Fostering Social and Emotional Learning through Technology, a report
from the World Economic Forum, written in collaboration with BCG.
Our definition of education technology comprises the following sectors: preschool through secondary school, higher education, adult learning, other
institutional, and alternative school. Investment in the “other institutional” segment includes mostly business management and systems management
technologies. Investment in consumer products is spread across all five categories but is concentrated in the preschool through secondary school segment.
Data comes from Capital IQ and company websites and includes investments from January 1, 2011, through December 31, 2015. Detailed breakdowns of
education technology investments come from using specific keywords and filters in the Quid software tool to identify the ed-tech space.

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