Brighteye Ventures, Europe’s largest edtech VC, has secured $54m in new funding — and it’s hoping the switch to online learning in the pandemic can help Europe’s edtech sector match the acceleration seen in China and the US.
The investment means Brighteye’s fund, which opened in 2017, now manages $112m in assets. The new money will be used to back 15 to 20 companies over the next three years at seed and Series-A stage, writing cheques for up to $5m to each.
A report last year by Brighteye indicated that Europe lags behind on edtech investment compared to other parts of the world. Chinese edtech companies brought in $3.3bn in total investment, America attracted $1.7bn, while European companies, in comparison, received just $700m.
But during the pandemic, with 90% of schools around the globe closed at some point, edtech has seen a surge in demand. At present, 2% of venture funding goes into edtech, but Brighteye thinks that the rapid evolution spurred by the pandemic will make edtech trend closer to 3-5% in the coming years.
“Post-COVID, few parents or learners will be unacquainted with some form of edtech,” says Alex Spiro Latsis, partner at Brighteye. “That familiarity with the sector in the general population will have net positive impacts on all aspects of the ecosystem.”
The coronavirus pandemic has also highlighted areas within edtech to focus on, Latsis says, particularly around technologies that can make platforms safer. “I’m interested in how we can leverage advances in AI to make both online and on premise educational experiences safer as they scale,” he says.
The proliferation of online learning during the pandemic has thrown up the challenge of maintaining a high degree of safeguarding for a growing number of users.
“The sheer scale of the task means humans alone will not be able to moderate communities of learners efficiently or cost effectively, and this is where AI is uniquely positioned to help,” he says.
In terms of location the fund’s focused on, Brighteye are expanding in the DACH region, which Latsis says is “particularly strong for vocational skills training and technical instruction, as well as language learning tech.” The fund is establishing a base there, which will also cover eastern and south-eastern Europe.
Startup founders already receiving funding from Brighteye are confident that the European edtech market can grow to match the US and China.
Arnd Aschentrup, founder and chief executive of Tandem, a Berlin based language learning platform, says that although the US and China are still larger markets, Europe is growing quickly.
“The availability of private funding has increased quite substantially over the last few years,” says Aschentrup. “Whilst things are growing steeply in Europe, there is still some way to catch up.”
This is partly, Aschentrep explains, because there have been specialised education VCs in the US for a lot longer than the UK. “It’s great to see things like Brighteye pop up in Europe too because this has been going on in the US for longer,” he says.
“Non-specialist VCs here have also started to discover education as a sector, which is an encouragement for specialist VCs to deploy more in this area too,” he adds.
Brighteye’s Latsis predicts that, although the level of new sign-ups seen during the pandemic might slow down, the rise of edtech will continue.
“I predict that the growth will tail off, but will remain higher than pre-COVID,” he says. “Most of us are now familiar with the edtech solutions on offer, and the frequency with which we now engage with online learning has lifted the sector into common usage.”
