Five Things about Edtech in Asia

LearnLaunch hosted a roundtable discussion on edtech in Asia last night. Mike Michalec, CEO of EdTech Asia, led a discussion of what’s hot in edtech in Asia.  He was joined by:

  • Duc Luu,  CSO of Rise Education (NASDAQ:REDU)
  • Tu Ngo Co-founder and Chairwoman, YOLA
  • Steve Ehrenberg, Associate Director Technology and Learning, FHI360

Here’s what was discussed:

1. China is hot. So is B2C English language learning and test prep.

Duc believes China is now the epicenter of edtech investment. HolonIQ indicated that 80 percent of edtech investment in 2018 went to Chinese companies.  Chinese entrepreneurs focus primarily on Business to Consumer (B2C) services, selling directly to parents who are eager to have their children attend the best universities in the world, and the high schools that will prepare them for that. Research indicates that Chinese families spend more of their disposable income on educational services for their children.

Duc, an American of Vietnamese heritage, built his business in Hong Kong. He started as a Kaplan and Princeton Review tutor became a SuperTutor in Hong Kong and built his company, The Edge, to become the #1 test prep business in Hong Kong. He sold Edge to Rise Education, where he works now, acquiring new companies.  Rise took a mature product from HMH, Destination English, which had failed as a Business to Business (B2B) offering, and moved it to a Business to Consumer (B2C) focus. Rise has built 310 learning centers in China with 120,000 students.  They are number 1 or 2 in every metro market in China. 

Selling to schools is highly regulated in China. Although there are 1800 independent schools, they require direct sales to win deals.  Duc believes the key to a successful business is building “sticky” relationships with families.

Mike reminded us that Asia is a set of different countries:  China, Vietnam, Indonesia, and Japan.  In Vietnam, edtech is thriving.

2. Just like in the US,“It’s a long ride to build a major brand in edtech”

Tu Ngo, Co-founder and Chairwoman of YOLA, is a Vietnamese citizen who went to college in the US.  She created YOLA to connect American teachers with students in Vietnam, so they could learn English and prepare to apply to American colleges. This was years before VIPKid. Watching the difficulties that Vietnamese students faced in America, she shifted to a 100 percent “off- line model”. She set up campuses in Ho Chi Minh City and Hanoi and recruited Vietnamese talent to be the teachers.  Tu built Yola over 10 years. “It’s a long ride to build a major brand in edtech.”  Tu looked backward in the student pipeline to see if she could prepare students better. She found textbooks that immigrant students in the US were using and started with those.  Parents came to YOLA because they are preparing kids for success.  YOLA now has 14 locations in Vietnam and more than 30k students, with 300 teachers and 200 employees.  Tu and YOLA pivoted to focus on teaching middle school students critical thinking skills and English.  In SFO,  she worked with automated speech recognition to help English learners to improve their pronunciation.

3. Predictions are for STEM and Voc Ed to grow quickly in Asia

Duc believes these are the two biggest areas of growth in Asia. The vocational sector will provide skill building for graduates looking for a job after college; he also predicts that STEM education will broaden within China within five years.   Steve Ehrenberg, Associate Director Technology and Learning FHI360, a large non-profit based in Washington, DC, is partnering with WGBH to pilot STEM learning in Vietnam.  

90 percent of funding for FHI360 comes from US government. Its 4000 employees work in 65 countries, with relationships with countries and their departments of education.  As a development professional, he likes to collaborate with edtech entrepreneurs, who can deploy apps to help aid and development organizations meet sustainable development goals.

4. Build your IP in the US, and use Asia’s operational savvy to scale

The group discussed the different teaching methodologies in Asia, including the fact that there are often a teaching assistants. Duc proposed that Asia has less history at creating IP because it doesn’t have a long history of creating and protecting Intellectual property.  We and Europe have a long history of creating and protecting IP.  Duc recommended that this is an advantage. Creators in the US should partner with Asian companies to build services in Asia. They can operationally scale the business. Chinese businesses, including Rise, are looking for US products to bring to their market.  Many opportunities exist in tech-enabled education services.

5. Social Emotional Learning (SEL) go to Asia?

This question was debated but left unanswered. Edtech is a data-driven exercise and how will SEL be measured?  SEL is by definition about the relationship between the child and teacher.   But there was quite a bit of interest! The dialog about edtech is truly a global one.

Four local startups presented their business ideas to the panel and were given feedback.  Thanks to Mike Michalec for arranging the discussion!

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