COVID-19 has been catastrophic, but it has proven to be an opportunity to test how technology can contribute to delivering an uninterrupted education experience. Institutes reluctant to accept technology had to rethink their education strategy. They had to focus on technology to facilitate teaching at home.
The COVID-19 pandemic is pummelling education. The campus shutdowns last spring (March 2020 onwards) led to a quick shift to “remote learning,” exposing the fragmented adoption of education technology and digital capabilities across thousands of colleges and universities. The tumultuous fall semester has increased the pressure on colleges and universities worldwide.
Pre-pandemic, there already was an acknowledgement that traditional education is seriously flawed. Fall 2020 marked a clear inflection point as students and education leaders alike scrutinized higher education’s price and value proposition with the advent of multiple digital delivery modes.
To help institutions and edupreneurs with better campus and education management, technology adoption, and to help them adapt to the sudden & drastic changes, EdTechReview recently hosted a webinar on “Transformation in Campus Management: Tech Adoption & Lessons During 2020”. This webinar was the fourth webinar in the webinar series for educators, EdTech entrepreneurs, and investors. The webinar was supported by AWS EdStart, an education technology-focused accelerator.
Utkarsh Lokesh (CEO & Editor, EdTechReview) moderated the webinar and Hemant Sahal ( Co-Founder & CEO, CollPoll), Sri Charan Lakkaraju (Founder, StuMagz), Gaurav Ranjan (Vice President, Prime Venture Partners), and Sunil PP (Head for Education & Non-Profit @AISPL.) joined in as expert speakers.
The experts from the education, investment, and technology fields talked about a range of things, from the challenges of making an overnight shift to remote learning to utilizing the given opportunity at its best. They spoke about various ifs and buts of the current situation and shared insights on what online education may have in store for the future. The experts also talked about the rise in EdTech players and how certain start-ups solve the problems using innovative approaches, among other things.
What are some exciting start-ups and businesses you’ve seen after coming into higher-ed/campus management? Is there any success story you would like to share?
Prime Venture’s Vice-President, Gaurav Ranjan, responded to the question saying that campus management is not as much about curriculum management as it is about digitization, campus operation, and curriculum delivery. The one trend that he sees coming is the focus on outcome-oriented programs with a focus on online teaching and learning. This is due to COVID accelerating the entire education system. These programs ditch rote-learning in favour of job guaranteeing, contemporary skills. To explain this better, he gives the example of their portfolio company, Sunstone, with a policy of “pay after placement.” i.e., learners are bound to pay only if they get a job at the end of the program. Gaurav mentioned Sunstone’s collaborations with several companies to design the curriculum to make the program relevant to the current industry requirements.
Gaurav talked about upskilling the grey collar segments. White-collar upskilling has been common in IT and tech sectors in the past, but now grey collar upskilling is picking up. He gives the example of a beautician working in a non-branded salon, skilling herself to work in larger, metropolitan brands, or a paramedic working in a standalone hospital getting skills and certificates to be a part of a bigger hospital chain.
With the COVID-19 accelerating the whole online curriculum delivery, in-class engagement has not been properly replicated. “There's great scope in the in-class-engagement segment," Gaurav added. One of Prime Venture's EdTech portfolio companies had primarily served the US market with a presence in almost 35% of its schools; Asia had very low adoption of in-class-engagement tools. That changed towards the end of 2020 with significant adoption by Asian and Indian schools.
Talking of campus management, Gaurav said operations digitization has come a long way. Operations digitization like fee collection, assignments, hostel management etc., are now a top priority for institutions. Institutions want to digitize entire operations – academic or otherwise – with comprehensive one-stop solutions. "This segment was a little slow earlier," Gaurav said, "It used to take (up to) two years to sign a customer… Now sales cycles have come down from two months to two weeks". He attributes this to businesses getting more inbound sales and traction due to COVID-19.
On being asked about innovative start-ups targeting higher-ed and campus management space inside or outside AWS, Sunil PP, Head of education & Non-Profit, vehemently agreed with Gaurav adding that everyone has had a learning management system but never used it. "(But) the pandemic has driven the usage significantly", Sunil added.
On the upskilling side, AWS has been in talks of enabling grey-collar workers with Alexa skills to help them earn more money. Another deviant trend, Sunil added, with virtual education is the rise of virtual interactive labs. These labs are trending because they aren't just the usual stream of online content but impart practical skills online, which was earlier thought impossible. Sunil added that in the K-12 space, teacher's education is becoming interesting, because, the new education policy is driving for many developing skills. Per his assumption, training teachers can become a big thing.
Have campuses done a good job of managing things in the current scenario? How have technologies helped? How will the scenario evolve once the market re-opens?
Hemant Sahal, Co-Founder & CEO, CollPoll said, "institutions really did a quick-fix". They were caught unprepared, but as Gaurav said, "in-campus technology has become a necessity". Earlier, only well-off institutions were looking for it, but now everyone wants it. In the adoption of technology by everyone, Hemant made three observations:
- Amalgamating several technologies makes them incompatible with each other. Like using Zoom and Google Meet resulting in lack of sync or information for participants.
- In a rush to shift things online, institutions adopted the solutions of whoever came to them first. There is now a need for a more systematic adoption of technology.
- Institutions are looking for more comprehensive online enterprise solutions – like Google Suite or Microsoft 365 – rather than individual products from various providers. Comprehensive solutions would be primarily driven, firstly, because of affordability since comprehensive suites provide better value than individual products; and secondly because comprehensive suites provide better cross-system dataflow, making it easier to connect timetables with LMS data, examination platforms, and other databases that the institutions already work with.
- Hemant also added that now that things are getting more organized on the tech adoption front, institutions will get the benefits of having affordable solutions. They'll get the real returns of technology and improvements in better ways. Institutions will gradually be willing to spend more money on solutions as well.
What kind of impact did COVID-19 have on your business? How has your overall business plan changed, if at all?
"From a revenue point of view," Charan said, "It wasn't affected much. Revenues have increased". Sri Charan Lakkaraju, founder StuMagz, stated that the education sector is the biggest unorganized sector in India. Every institution has a different structure. In SaaS models, companies often say, "less customization is better". With colleges though, Charan said, there are as many customization requests as there are colleges. Providing such highly customized solutions is difficult, all the more so since the purchasing factor for many colleges is the customization they ask for.
Talking of changes in the industry, Charan said, "Earlier, people were not ready to pay for subscriptions of Zoom or other [software], but now they are". Even so, terminating an institution's subscription in the past due to non-payment was a bold move. "You can't compare enterprise sales to college sales. There might be hundreds of enterprises popping up, but colleges are very few. And we have to pay to keep the system running anyway".
Another thing Charan pointed out was handling the customizability requests and the customer support wings of the business. Institutions with partial digital capabilities didn't want to switch over to completely new systems and pay too much for entire suites of solutions. Instead, institutions wanted cheaper a-la-carte solutions. For example, institutions would ask for digital solutions to be plugged into their existing LMS. With legacy systems often not allowing seamless plug and play, it was really hard for Charan's team to deliver during the work-from-home state in the pandemic. Remote customer requests combined with bandwidth issues and lack of time put their customer support wing under a lot of pressure.
What do we expect from 2021 from an EdTech founder's and an institution's perspectives?
Answering this question, Hemant shares the institutional perspective on the available SaaS opportunities:
Systems of record opportunity: Institutions require varied technologies to manage time table, attendance, fees and more. For companies, it's a game of distribution; whoever knocks more doors can sell more. "There’s hardly any price point play that you can do (here)”, Hemant adds. According to him, out of 40,000 institutions, 75% are looking for systems of record.
Systems of engagement opportunity: According to him, 20-25% (around 8000) of the 40,000 institutions are ready for using a system of engagement. This includes LMS, online student engagement through quizzes, photography, etc. Most institutions focus on building an emotional connection, especially, with first-year students given that they aren’t physically present. They’re now ready to take up the newest EdTech solutions to build a system of engagement.
System of intelligence opportunity: As of now, a lot premium and some small institutions, are asking, “how to do resource utilization?”. They want to know at what point should they invest more in facilities, which department is under or over staffed; basically, how to optimize all processes. According to him, about 5% of institutions expect such analytical solutions, 75% of institutions are looking for solutions to manage basics and transactions, and around 20% are looking for engagement between stakeholders.
Sharing his EdTech player perspective, Hemant looks at the market as any other SaaS market. “There’s an enterprise play and an SMB play”, he says. Enterprise play is about inbound sales, which is the aforementioned 20% market where institutions organically reach out to companies. SMB play comes with tier-2 and tier-3 institutions, which has more institutions but lower per-institution revenue. SMB is a long-term play where companies should have a freemium approach to build limited versions to enable maximum participation. “There are lots of opportunities for integrations, up-selling etc. This is where you would need investor capital because you will be burning some capital for the first few years before you start making money.”
Hemant further explains why enterprises in India are not a hot segment. He states that investors invest mostly outside India because most of the fortune 1000 are outside India. However, investors are opening up to the Indian scenario now.
How difficult is it to differentiate the offerings in a saturating market? How did you manage?
Mr Charan from StuMagz says that in Tier II and Tier III cities in India, the system of records never really worked because making payments wasn’t important for them; it was a good-to-have rather than a necessity. Systems of engagement have been their strength. “We were banking on that more and trying to bring more collaboration in that area,” Charan said, “when we understood the system of intelligence, we found it to be a tiny market in India”.
Charan found that many colleges didn’t have GST numbers which meant they didn’t pay the GST. “It might sound minuscule, but at the end of the year – with low margins on the product – you need a lot of investor capital to sustain this kind of a thing because we have to absorb the cost (that colleges aren’t paying).”
Regardless, Charan said that system of engagement has lots of potential because there are more users to interact with. “After we started working with different companies and engaging people in job and work-from-home opportunities, many companies hired interns from us,” Charan said, “that became a good revenue stream for us in the last 4-5 months”. Since this had happened during the admission season, it was a good time for colleges to realize that a platform like Charan’s, is actually helpful in catapulting their image as a good institution.
In spite of these challenges, what parameters are you looking at in EdTech start-ups at Prime Venture Partners? Has there been any change in evaluating EdTech start-ups during COVID?
“In terms of evaluating EdTech start-ups, fundamentally there’s no difference in an EdTech start-up, health tech or a SaaS start-up…since we come in really early in their development,” Gaurav from Prime Venture Partners said, “since we don’t have a lot of data, we evaluate what insights the team has that competitors don’t. The second thing we look at is the market; if the investment will yield an equivalent prize.
The third thing we look for is the differentiation of the product. It should be fundamentally different or have a different distribution, or customer experience or success. These factors remain the same for all start-ups”. As to what has changed this year, Gaurav said that they have been more diligent this year in looking at EdTech.
“We tried not to get swayed by the EdTech wave,” Gaurav said. They started doing more calls to evaluate customer interest, and looked at start-ups that built frugally, were building sustainably, and had a strong distribution differentiation that actually added value to customers.
Do you see any increasing interest from investors towards B2B EdTech start-ups?
Sharing his views, Sunil states that investors don’t really come directly to them, but he sees opportunities because the market has changed dynamically in less than a year. Everyone has been forced to adapt to virtual platforms.
“The biggest problem, typically, is content creation,” Sunil said, “however, many school teachers have learnt to make beautiful PPTs. They’ve been forced to do it in the last couple of months. The quality of content is really high, but the question is ‘will this online learning surge continue next year?’
Sunil is unsure because, unlike most geographies, India has a habit of large investments in captive campuses. Managements love to have students come back to physical campuses rather than they stay online. Therefore, he foresees a strong push to drive students back to campus. “However,” he adds, “it will be interesting to look at how colleges digitize their campuses, which already helps teaching and learning grow.”
Another point was the assessments. According to Sunil, there’s a struggle for creating virtual assessments that are cost-effective. In India, people are using Moodle for assessments. “It was never meant to be for assessments…but the interest is going to drive the adoption of technology because, a lot of people have not adopted technologies and there are going to be big B2B areas worth looking at”, Sunil concluded.
What’s your experience with investors? Is there increasing interest from investors to support B2B start-ups in EdTech?
CollPoll’s co-founder, Hemant, states that when he started CollPoll, he was clear what journey he would be on. He adds that the mantra of being a “good entrepreneur” includes the following:
- A good entrepreneur needs to understand market nuances, what kind of investors are needed, and what expectations to set. The global market needs solid information about the product to make it worth pitching. “It would help if you brainstormed with an investor about funds (in SMB) for a better knowledge of the market”, Hemant adds. In SMB, he says there are three opportunity areas:
- Cost-cutting for institutions is a big plus. Every institution wants reduced costs for newer technologies.
- Improving learning outcomes by bringing in other partners to deliver better content. Institutions are generally technologically poor and need comprehensive solutions which can be provided by integrating solutions with other partners.
- Creating a marketplace for internships and other job-oriented programs on the platform. Hemant said that this is where SMB stands out. Investors are interested, but not enough to invest yet. “Just sit and talk with investors,” Hemant says, “get one person to write a cheque, and others will follow. That’s what happened with Byju’s”. This is what Hemant thinks the future of SaaS for education will look like: create evidence, prove results, get one investor, and the industry will explode.
- Upskilling is very important now because online education can’t replace physical campus experience. Quality physical education isn’t dying. Its value will only increase with tech integration.
- Hemant also advises entrepreneurs to bring in partners for content creation, faculty management, assessment etc. According to him, most institutions are looking for one core solution to orchestrate all work and he foresees a huge opportunity in integrating multiple solutions due to institutions having low technology-services consumption.
Is the sales and implementation process completely online or only partially online?
Charan responded that due to COVID-19, edupreneurs don’t have any option; “for instance, the cost you save and the gross margins that have increased, is the first factor”, he added, “previously when we talked of Zoom or Google Hangouts classes, we were asked to come down to campus, numerous meetings would be held with the same customers, and that’s why B2B was often disliked. But, B2B clients have changed a lot.”
Gaurav added to Charan saying, “institutions are happy with being fully digital because it brings more accountability with every bit of data organized neatly in one place”. They have onboarded 50,000+ enterprise users completely digitally.
How do you see front-end technology like AI and ML transforming campuses?
“With these technologies, everything is happening online, for example, online assessment (AI proctored online examination) is a huge opportunity, so we conducted thousands of tests in the last few months,” Gaurav said. “Institutes are planning to continue this automation at least for internal exams due to less headache and no need for students’ physical presence.”
“AI and ML have made evaluation easier and faster, and post-exam services like revaluation quicker and more accurate,” Gaurav said. More and more institutions are welcoming the change, and they’ve shown interest in continuing. Its usage will reduce administrative tasks and costs, and edupreneurs are only scratching the surface of personalized adaptive learning using AI, ML-based assessments, previously available but not well implemented. “Now that digital tools are used frequently and ubiquitously, there is enough recorded data to leverage AI and ML,” Gaurav added.
Hemant added to the conversation saying that the lack of data is being taken care of now, but it will take time to build databases. “It will eventually lead to super-efficient educational outcomes and new learning models enabled by AR and VR,” he said.
Sunil added that the government has made a lot of effort to drive the industry for automation technology adoption in campuses. He talked of AWS Educate giving free tools and content for learning, which can help campuses adopt technology faster by allowing them to acquire practical knowledge faster. He also points that over the last six months, AWS has witnessed a surge in users' number, probably due to the on-going pandemic.
What evolution do you see moving forward in terms of digital adoption? Apart from online assessment, what are the other areas where you see help is needed?
“It is a nightmare to implement social distancing in K-12,” Sunil said, “in higher education, it’s still enforceable. A couple of institutions are working on that, but how do you create a functional social-distancing solution?”
Sunil suggests using Bluetooth as a potential way to keep distance in groups. “However,” he added, “in reality, it’s challenging. All technologies at this point are in experimental phases.”
What is your advice to emerging EdTech Start-ups, especially for someone targeting higher education?
Gaurav advised EdTech players to first look at adding real value through their products by building sustainable products that will outlast the pandemic. “Look for trends where customer behaviour is changing for good or would more or less be permanent.”
Gaurav suggests spending frugally because a lot of capital has already gone into the market. “Wait and watch for the next 12 months in case you don’t have much capital. Weather the storm; if you have a good product, you will be fine.”
The most important factor, according to Gaurav, is to be close to your customers. Talk as much as you can to know customer behaviour; get feedback for product creation and everything besides”.
What are the key lessons learned from 2020?
“As Gaurav mentioned,” Hemant said, “it is necessary to stick to the first principle of the enterprise SaaS business, i.e., stay close to customers as possible.”
According to Hemant, as an EdTech business, you should be closer to your customers, and not their IT representatives. “Ultimately, your end users are students, staff, and administrators.
The closer you are to your users, the better the platform utilization”. Hemant suggests maintaining good relations with partners, understanding their pain points, and making efforts to solving them. On investments, he said “you have to be clear what you need the capital for. “Understand the landscape of investment in the market, stick to your ethics code and keep executing,” he said adding, “don’t get desperate and change course, don’t reduce your prices and go in every direction. You don’t need to reinvent the wheel.”
The webinar concluded with a piece of advice by Mr. Sunil on “what supports start-ups can expect from AWS EdStart and AWS Academy. “AWS EdStart provides an infrastructure that scales and AWS Academy provides on-campus certifications,” Sunil said, “you can also use AWS Educate to access content for basic skilling programs in early stages of your EdTech start-up.”
Sunil stated that there are tons of dependable programs run by AWS, which allow start-ups to leverage AWS technology, platform, & infrastructure to scale efficiently.
“There are several tools and resources that AWS provides for free, and users can take advantage of it to gain as much knowledge as they can,” Sunil concluded.