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The Challenge for Companies: Supporting Teachers in a Chaotic Era

Businesses in the education market face new and unfamiliar obstacles in delivering product support and professional development that spans remote, hybrid, and in-person learning environments.

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Learning Loss During COVID Will Fuel Economic Losses, Business Leaders Predict

The impact of learning loss during the pandemic won’t just be felt in the classroom. It could also saddle the future economy.

That was the core argument put forward recently by a group of eight business leaders from North Carolina, who made a public plea for state policymakers to address students’ academic slippage during COVID.

Among their recommendations, laid out at a recent online event, were for state policymakers to set up a recurring funding stream to train all of the state’s educators, and to move from a “student tutoring model” for literacy education to a model that supports educators based on the “science of reading.”

Reading proficiency among North Carolina 3rd graders slightly worsened during the pandemic.

According to a report last month by the (Raleigh) News & Observer, accounting for 67.7 percent of 3rd-grade students who had taken midyear assessments, 75.4 percent of 3rd graders were not reading at a proficient level, compared to 73.6 percent last school year.

“Let’s be clear: This is not just a North Carolina problem,” said Kelly King, chairman and CEO of Charlotte, N.C.-based Truist Financial Corp., a consumer and commercial bank holding company. “This is a national problem.”

The impact of learning loss does not appear to be hitting all U.S. school communities equally. A report released by McKinsey & Company in December found that there was a 10 percent drop in average K-5 reading levels among majority-white schools during COVID, but a 23 percent drop in average K-5 reading levels among minority-majority schools.

Another participant in the North Carolina event, Honeywell Chairman and CEO Darius Adamczyk, noted that COVID has likely accelerated the need for higher educational attainment, a demand that is unlikely to abate. Honeywell, headquartered in North Carolina, is a conglomerate with a heavy focus in aerospace and building technologies, among other industries.

Investing in early reading proficiency is integral to weathering a changing economy, and for students to gain education and skills to meet the needs of businesses, Adamczyk said.

“The recommendations we’re making today will address inequities in our workforce and help us develop a strong, diverse, and resilient talent pipeline well into the future,” he said.

In addition to recommending recurring state investments in teacher training in reading, the leaders called for North Carolina policymakers to maintain and even expand funding for pre-K access in the state and to eventually accomplish the goal of enrolling 75 percent of the state’s pre-K-eligible children, and to ensure that every county hits that benchmark.

The state currently funds pre-K programs at about $154 million per year.

Fred Whitfield, president and vice chairman of Hornets Sports & Entertainment, noted that about 9,100 fewer children enrolled in North Carolina pre-K for the 2020-2021 school year compared with the previous school year, eliminating all of the enrollment gains made in the state over the last four years.

Before COVID, enrollment in the state’s pre-K had topped 31,000 children — about 50 percent of the children eligible for the program statewide, he said. Now, pre-K programs in the state are serving only 36 percent of eligible children.

A Big Focus on Pre-K

“The drop in enrollment should not be viewed as a decrease in demand or need for North Carolina pre-K,” Whitfield said. “To the contrary, although we have much to overcome, this proven high-quality program, targeted at some of our most at-risk children, is needed now, more than ever.”

In addition to calling for more support for pre-K, the business leaders are asking state officials to inflation-adjust North Carolina’s pre-K funding for the first time in nine years, to require an annual such inflation adjustment, and to modify county-state cost sharing percentages to help economically disadvantaged counties cover program costs, Whitfield said.

During their presentation, the business leaders cited a 2016 CEO action plan to support improved U.S. literacy rates put forward by Business Roundtable, an association of CEOs at leading U.S. companies.

North Carolina business leaders were inspired by the action plan to initiate several pro-education initiatives, including creation of a comprehensive aligned education system for grades pre-K-3, as well as launching a data methodology to ensure that children stay on track to achieve reading proficiency, said Dale Jenkins, CEO of Raleigh, N.C.-based medical malpractice insurance provider Curi.

A “robust data system” is scheduled to roll out later this year, Jenkins said.

In 2017, the North Carolina General Assembly formed the Birth through Third Grade, or B-3, Interagency Council, which is a joint council between the North Carolina Department of Health and Human Services and the North Carolina Department of Public Instruction.

The goal of the effort was to create a vision for a birth through 3rd-grade system of early education, and a system of accountability tied to it, including standards and assessment, data-driven improvement and outcomes, and teacher and administrator preparation and effectiveness.

“We’ve made progress on these goals through the B-3 Interagency Council that was created in 2017 to address these issues among others,” Jenkins said. “We applaud the General Assembly and the governor for moving this forward together.”

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Why Do Ed-Tech Products Soar in Some Districts, But Flop in Others?

DigitalVision Vectors/Getty

The EdTech Genome Project aims to give districts more accurate, granular comparisons of what ed-tech products work in what kinds of schools.

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Bipartisan Legislation Would Allow E-Rate Funding for School Bus Wi-Fi

Ben Ray Lujan

A bill recently introduced in the U.S. Congress would make make E-Rate money available to support Wi-Fi on school buses, the latest of several recent recent efforts to expand student internet connectivity outside school hours.

Sens. Ben Ray Lujan, D-N.M., and Lindsey Graham, R-S.C., have introduced the legislation, which would require the Federal Communications Commission to issue regulations to make Wi-Fi access on school buses eligible for support under the E-Rate program no later than 180 days after enactment. Under the bill, schools would be reimbursed for equipping buses with Wi-Fi.

The E-Rate program is funded at $4 billion annually, and allows schools to receive reimbursement for certain internet services provided on campus.

If policymakers provide more financial support for off-campus wireless services, it could increase the ability of students to make use of companies’ ed-tech tools, apps, and platforms, including on long bus rides where students have access to laptops and other devices, if this bill gets enacted.

The bill is aimed, in part, at promoting digital equity for rural and tribal communities in states like New Mexico, according to Lujan’s office.

Approximately one-quarter of New Mexico’s over 350,000 students don’t have affordable internet, according to a statement by the New Mexico Homework Gap Team, which describes itself as an ad hoc group of professionals who support narrowing the digital divide for K-12 students in the state.

A December study by the Alliance for Excellent Education estimated that almost 17 million students nationwide lack home internet access to complete school assignments.

“For rural and tribal students who travel hours to and from school, these commutes can be valuable time accessing the internet, completing assignments, and conducting research,” Lujan said in a statement. “Empowering our schools to equip buses with Wi-Fi is an opportunity to uplift our students, tackle the homework gap, and help alleviate the financial strain that too many families are experiencing at home.”

If passed, the legislation would give schools more flexibility in terms of figuring out how they can best use ed tech to promote equity, said Amina Fazlullah, equity policy director for Common Sense Media, a nonprofit dedicated to promoting safe and effective technology use for children.

“Every community has different layers of barriers to equitable access to education related to technology,” she said in an interview. “Having that flexibility ultimately in the E-Rate program will be incredibly useful for schools where students have long commutes.”

But Fazlullah suggested that the ed-tech funding expansion outlined in the Lujan-Graham bill shouldn’t substitute for other potential federal initiatives to support costs for students’ home connectivity.

It remains to be seen whether the FCC will act decisively on some lawmakers’ and education advocates’ calls for a long-term, dedicated funding source to support students’ home connectivity.

The COVID-19 stimulus package approved earlier this month allocated $7 billion to the FCC for the creation of what is being called the “Emergency Connectivity Fund,” separate from E-Rate, to pay for high-speed internet and devices used off campus.

The commission also recently announced plans for a policy that, among many other things, would allow school districts to apply for reimbursement for costs they have paid for students and teachers to access broadband at home.

FCC Acting Chairwoman Jessica Rosenworcel, in an interview with Education Week this month, said the agency remains in the “process of evaluating how we can update the current E-Rate program to meet the moment students and families find themselves in.” She spoke after the agency in February issued a request for public comments on whether E-Rate funds could be used to support remote learning during the pandemic.

In 2018, then a U.S. congressman, Lujan became familiar with how Wi-Fi operates on a school bus when he attended a “Rolling Study Halls” event. Hosted by Santa Fe Schools and funded by Google, the event took a Wi Fi-equipped bus to a Native American pueblo in New Mexico, Tom Ryan, chief information and strategy officer for the district, noted in an email.

In addition to Santa Fe, the Albuquerque district is one other school system that has outfitted school buses with mobile Wi-Fi units, installing hot spots on 80 buses across the area as of October.

Rep. Peter Welch, D-Vt., has introduced legislation similar to the Lujan-Graham bill in the House.

The legislation has picked up endorsements from the National Education Association, Competitive Carriers Association, Free Press, Public Knowledge, School Superintendents Association, Association of Educational Service Agencies, Association of Latino Administrators and Superintendents, National Rural Education Association, National Rural Education Advocacy Consortium, and the State Educational Technology Directors Association.

Photo: Sen. Ben Ray Lujan, D-N.M., is pictured on June 29, 2018, visiting the Kewa Pueblo, a Native American settlement southwest of Santa Fe, N.M.  The program was called “Rolling Study Halls” which was funded by Google.


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Where Venture Capitalists Are Investing as Districts Shift to In-Person Education

Investors are putting a premium on companies that have the products and expertise to span distance learning and a return to in-person lessons.

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Global Spending on Virtual Reality, AI in Education Poised to Skyrocket, Report Says

Global spending on artificial and virtual reality in education is expected to soar from $1.8 billion to $12.6 billion annually over the next four years, a new analysis projects.

Spending on artificial intelligence in education, meanwhile, will jump from $800 million to $6.1 billion yearly over that same period, according to the report released recently by HolonIQ, a global research and intelligence firm.

The report made several projections for global ed-tech expenditures in K-12, higher education, and corporate training through 2025. Those include forecasts of total education spending, upskilling, spending on digital technologies as a proportion of total education spending, and venture capital investment.

“AR/VR is coming down the stack from workforce into higher ed, and is slowly making its way into K-12,” Patrick Brothers, the co-CEO and co-founder of HolonIQ, said in an interview.

Augmented and virtual reality has seen only modest uptake yet in K-12 because there’s a big learning curve for students and teachers to become familiar with the technologies, and because their use will take some time to catch on, he said.

Other areas of advanced technology figure to see significant growth in expenditures through 2025, include robotics and blockchain, according to the report. It projects that the total spent on robotics will rise from $1.3 billion in 2018 to $3.1 billion in 2025, and that the total spent on blockchain will rise from $100 million in 2018 to $600 million in 2025.

HolonIQ
HolonIQ

The biggest driver for the use of blockchain in education is a desire for secure and scalable credentialing, while the biggest spark behind the use of robotics in education is schools looking for different ways to engage learners in STEM fields, Brothers said.

HolonIQ forecasts overall global spending on ed-tech to rise from $227 billion in 2020 to $404 billion in 2025.

Currently, spending on digital technologies makes up just 3.6 percent of total expenditures in the areas of K-12, higher ed, and corporate training. In 2025, that percentage is expected to rise to a higher but still small level of 5.2 percent of overall spending.

“While the longer term impact of COVID-19 on education models is yet to play out, over the next few years we expect an upswing of spending on digital infrastructure in education and greater spending over the long term in new digital models,” the report states.

HolonIQ defines spending in the report as governments, companies, and consumers devoting money to a learning product or service. That distinguishes it from education investments, which are characterized by the supplying of capital in exchange for a stake in a company, Brothers said.

The report also notes that global ed-tech venture capital funding has risen from its previous record of $8.2 billion in 2018 to $16.1 billion in 2020, with Chinese companies occupying the largest share of funding compared with other countries.

Investment in educationwill continue to grow, but is not evenly spread across the globe and weighted heavily towards late-stage mega-rounds,” the report says.

Chinese ed-tech companies saw $26.8 billion in venture capital investment between 2010 and 2020, while U.S. companies saw $13 billion invested in the same period.

Overall, HolonIQ projects that total global education spending will rise from an estimated total of $5.4 trillion in 2020 to a total of $7.3 trillion in 2025, noting that education composes over 6 percent of global GDP.

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COVID-19 Fueling New B2B Relationships Across K-12 Education Industry

The pandemic has laid bare needs that education companies are trying to address to new collaborations and partnerships.

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Zoom’s Big Stamp on the K-12 Market Is Poised to Grow

The communication platform has become an essential component for school districts trying to bring remote learning to students and families.

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Non-Education Companies Jumping Into K-12 Market During Pandemic

Education companies that either weren’t involved in education at all, or had narrower interest in it, are finding ways to serve the market during COVID-19.

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Europe’s Largest Ed-Tech VC Firm Launches Second Fund With $54 Million

Europe’s largest ed-tech venture capital firm has started its second fund.

Brighteye Ventures anticipates investing in 15-20 companies over the next three years at the seed and Series A stages, and writing checks of up to $5 million.

The Luxembourg-based firm’s recent $54 million fundraise for its second fund brings the firm’s total assets under management to $112 million, and it anticipates raising a total of $88 million by the spring for Fund II, the Brighteye Ventures said in a statement.

Brighteye Ventures anticipates receiving funds from a mix of family offices and strategic and institutional investors.

Like its first fund, which committed roughly $60 million in total capital, Brighteye Ventures is expected to spend about half of its second fund on direct-to-consumer products, one-quarter on corporate learning tools, and one-quarter on software that enables existing educational institutions to be “better, faster and cheaper,” Benoit Wirz, a partner at Brighteye, said in an interview.

One possible exception in that calculus is that Brighteye could look to invest a bit more in software for schools and universities, as the pandemic has increased digital penetration within the education market.

“The companies that have done the best [during COVID-19] are full-stack, purely online educational offerings that respond to people’s needs to train, or particularly related to professional skills,” he said. Yet “across the board, I think online educational experiences are doing well.”

Two of the 18 total companies financed by Brighteye’s first fund were based in the U.S., Wirz noted, adding that he expects Brighteye will invest in about one to four U.S.-based companies out of the second fund.

About 80 percent of the firm’s investment targets are based in Europe.

In terms of the types of U.S. companies that Brighteye will look to target through its second fund, the firm is considering software that allows for large-scale delivery of online education, ranging from administrative tools to tutoring platforms to online assessment proctoring, Wirz said.

Wirz also sees enormous potential in efforts to apply artificial intelligence to learning.

“The use of AI for content creation is something that we’re really interested in,” Wirz said. “There’s a number of companies that are doing that quite well.”

Brighteye is also scouting potential uses of AI for narrow professional development applications, Wirz said. He pointed to the firm’s completed investment in Silicon Valley-based TeachFX, which provides a coaching application to improve the quality of dialogue between teachers and students

The firm has invested only about 50 percent to 60 percent of the money committed to its first fund, but the remainder of capital available in that account is reserved for follow-on investments in existing portfolio companies, according to Wirz.

The firm has committed or invested about 5 percent to 10 percent of the $54 million currently in its second fund, he said.

“While Brighteye Ventures has long advocated for greater adoption of tech-enabled learning solutions, we scarcely imagined the size of the move that closing 90% of global schools would provoke in Europe, the U.S. and beyond,” said Alex Spiro Latsis, managing partner at Brighteye Advisors, the sole advisory firm to the fund, in a statement.

Latsis continued, “Post-crisis we expect broader awareness of tech enabled learning tools to continue to drive increased adoption as consumers and businesses look to enhance skills through the coming recession and recovery.”

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