Every industry has seen major Impacts in its processes after the Pandemic situation.The education industry has also adapted and transformed its functionalities.
Many educational organisations has come up with various Edtech solutions to secure their positions in the education industry. Edtech is referred to as the ecosystem where technology is utilized to assist the delivery of education services. Also referred to as new technological implementations in the classroom.
The Purpose of Education is to turn Mirrors to Windows . Since time , technology has become a forefront of education. This is how Edtech startups were born and are emerging because of their inherent nature.
Purpose of Edtech
is to develop software solutions that make education more accessible and streamline the learning process.
Revenue models
is the right choice to know the complexity of the startups. It gives a clear picture of choosing the right revenue source for the business. It’s essential to know what value to offer and who pays the value.
Before getting into next process, as an Edtech software development company , you should understand the education sector ,users needs and expectations and the competitive market.
- Freemium or Free Trial
- is the first model of Edtech company. everyone is font of this model as it is free.
- This model allows users to use products and services for free , with an option to upgrade to a paid version for extra features and functionalities .
- It has 2 different ways to work
1. Feature Limitations(Freemium)
2. Limited Time Period (Free Trial)
- As no customer would get into buying a membership or upgrading the services, thus , the Edtech companies find no profit in the end.
- The disadvantage in education is of the principal-agent problem , which means that your users aren’t your customers or buyers.
- Students and educators are interested in the product and services that you offered but might not be able to convince the higher authorities to upgrade and purchase them.
- Coursera is an excellent example of an Edtech startup. In 2020, they earned over 30+ million new users.
2. Top Down
- The top down or institutional model is a more traditional method of selling to schools through district leaders.
- Here , the market size is first estimated and then the targeted market volume is decided on the anticipated penetration rate.
- The advantage of the top down model is that the districts will sign large contracts.
- The disadvantage of the top down model is that these contracts consume a lot of time to sign up and are contested by competing vendors.
- Schoolzilla is an example of topdown ,district-wide or state – wide implementation of Edtech software. It offers a host of features that aid school and district level decision making. Its metrics showcase the results of changes made to school curriculum and policy through data driven metrics.
3. Bottom Up
- Once the predicted growth is estimated , the feasible market volume and total revenue is determined .
- Edtech companies can approach the consumers through schools that are convinced to utilize the product or service for free. If the families want to keep it at home , they might be charged for it.
- Schools generate leads for consumer adoption.
- This model is suitable for the Product Loop between educational institutions and home.
- Its disadvantage is that it is a potentially inequitable strategy as every students financial background could vary.
- Scholastic and ABCmouse offers great option as they can use the product for free and students would pay for its usage at home.
4. Sponsored
- is a unique and unconventional model in which neither the school nor the parents would pay for the products or services.
- A company sponsors the product and pays for product placement.
- Also called as Corporate Social Responsibility (CSR)Project.
- Benefit is that when you offer a great product to schools for free , utilisation will be relatively high for the sponsors.
- The sponsors have the opportunity to build brand awareness and goodwill for their company.
- Gonoodle is an example of sponsored which helps to improve company’s image.
5. Edtech Market Place Model
- allows educators to showcase their course to a massive audience and the platform earns a percentage from the proceeds.
- Udemy in an example of Marketplace model. It is a online marketplace that allows businesses and individuals to offer the courses online. Charges only the 50% of the course fee.
6. Ad-Sponsored Model
- Startups can offer ads during a course to cover its cost.
- Greatway to showcase more courses to your existing customers in the form of ads .
- Duolingo is an example of Ad sponsored model.
Requirements to start an Edtech
1. Know your market
2. Study the system
3. Pitch Right
4. Know the system , Hire a teacher