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ETS Acquires English Language Learning Test Assets for Japan

ETS announced this week that it acquired the testing assets of its longtime partner in providing English language learning tests in Japan, the Council on International Educational Exchange.

With the purchase, the nonprofit based in Princeton, N.J., will establish a new subsidiary, ETS Japan, to take over the operations and support services provided in the country.

The move supports the organization’s interest in growing internationally by establishing its own footprint in Japan, said Ralph Taylor-Smith, Managing Director of ETS Strategic Capital, the investment arm of the research and assessment entity. For the last 40 years, ETS tests and other products have been administered in Japan through CIEE.

“We already have business in the country,” Taylor-Smith said in an interview. “But this allows us now to start to expand our global reach, and really gives us a footprint to start to build other areas… Having people on the ground really gives us that local presence and local reach.”

Founded in 1947, ETS is one of the best-known providers of testing in the United States and abroad. Their tests include statewide summative exams, graduate-school entry tests, and tests of English-language proficiency.

With the acquisition, the company will work to provide a complete experience for students, according to an ETS press release, including helping students prepare for the Test of English as a Foreign Language (TOEFL) exams and GRE graduate school entry exam.

Taylor-Smith declined to reveal the total cost of the TOEFL acquisition deal.

This is the latest in a string of purchases and investments for ETS Strategic Capital, which was announced in September 2020 with a portfolio of five companies. The venture capitalist arm of ETS now has a portfolio with closer to 10 companies, Taylor-Smith said.

EdWeek Market Brief previously reported that the investment arm’s M&A deals were expected to range from $20 million to $200 million in size, and its equity investments could run from $1 million to $20 million.

The ETS program’s growth comes as venture capital investment in education surged. Investors put more than $16 billion into ed tech in 2020, according to a report by HolonIQ. That’s roughly double the amount put forward in 2018.

Photo:  David Davies/PA Wire via AP

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‘Global Education Recovery Tracker’ Offers Country-by-Country Status on School Reopening

Johns Hopkins University, World Bank & UNICEF (2021). COVID-19 Global Education Recovery Tracker. Last updated as of 24 March 2021. Baltimore, Washington DC, New York: JHU, World Bank, UNICEF.

Three organizations with a major focus on education have developed a tool that tracks and displays school reopening and recovery planning efforts in over 200 countries and territories.

The World Bank, Johns Hopkins University, and UNICEF have unveiled the COVID-19 Global Education Recovery Tracker.

The online database breaks countries into six reopening categories: in-person education; hybrid/remote education; combination of in-person, hybrid, remote, and closed; schools closed due to a regular school calendar closure; completely closed; and, unknown status/data not available.

The tracker also includes U.S. state-by-state and country-by-country information on the status of vaccine availability for teachers.

“The world was facing a learning crisis before COVID-19,” World Bank Global Director for Education Jaime Saavedra said in a statement. “The learning poverty rate – the proportion of 10-year-olds unable to read a short, age-appropriate text – was 53 percent in low- and middle-income countries prior to COVID-19, compared to only 9 percent for high-income countries.”

These divides have gotten even worse during the pandemic, and COVID-19-related school closures are likely to raise the learning poverty rate by another 10 percent, Saavedra said.

Data through early March show that 51 countries have fully returned to in-person education, and that in over 90 countries, students are being instructed through multiple modes, with some schools open, others closed, and many offering hybrid learning options, an announcement by the organizations states.

Researchers from the World Bank, Johns Hopkins, and UNICEF each have subsets of countries for which they’re responsible for compiling data, which is gleaned from publicly available sources, including government data and news sources, said Megan Collins, a bioethicist, pediatric ophthalmologist and professor of ophthalmology at Johns Hopkins University, who is also a leader of the education recovery tracker project.

Information gleaned from news stories needs to be accompanied by at least one other source for validation, she said.

After researchers gather the data, on a bimonthly basis, the team looks through and validates the data, after which researchers answer survey questions intended to decipher the status of school reopenings and the prioritization of groups considered more vulnerable to contracting the disease, such as teachers, Collins said.

“The survey is broken down into, ‘Are schools in the country open or closed right now? Are teachers being vaccinated as a priority group? Yes or no,” Collins said.

“’If schools are in person, what types of learning modalities are being employed? If schools are virtual, what types of learning modalities are being employed?’”

As of March 24, the U.S., Australia, Japan, Germany, and Argentina, were among the major education markets whose schools were operating with a combination of in-person, hybrid, remote, and closed classrooms.

Fully Open Schools in Russia, France, Spain

Meanwhile, the major markets of Brazil, Mexico, India, Sweden, Norway, and Saudi Arabia were either combining remote and in-person instruction and/or their students were exclusively learning remotely.

The U.K., Russia, France, Spain, and Ethiopia, were among the countries where schools are fully open and students have returned for in-person instruction.

“Institutions like the World Bank are helping developing countries’ education systems by providing the evidence to understand where investments are likely to be most impactful,” World Bank Education Global Practice senior operations officer Kali Azzi-Huck and World Bank senior education specialist Tigran Shmis said in an email.

“This tracker helps us to gather critical data and provide advice on country policies to tackle learning loss and accelerate learning in countries.”

Many education companies in recent years have taken a growing interest in exploring international markets outside their home countries. Those ambitions have been fueled by several factors, including the ease of delivering products and services via ed tech, rising income levels in developing nations, and the hunger for new forms of online learning during the pandemic.

Another resource released by the World Bank, Johns Hopkins and UNICEF, shows country-by-country school status/education modality, along with whether that country has authorized COVID-19 vaccines and whether teachers are currently being vaccinated as a priority group.

One revealing takeaway from the tracker is that teachers in low- and middle-income countries are largely not being vaccinated against COVID-19, and that two-thirds of the 130 countries where vaccine information was available are not currently vaccinating teachers as a priority group.

A few of the challenges that the organizations have faced when standing up and updating this resource include the lag between the time of data collection and publication, mostly due to the breadth and complexity of the data; as well as the inability to get granular data, Collins said.

The tracker is “an amazing opportunity to look at what’s happening globally,” she said. “But it certainly does not have the capabilities to dive down to the level of what’s happening for fourth graders living in a certain district of a certain school system in India.”

Collins said Johns Hopkins has been “uniquely positioned” to provide information during the pandemic, noting that her Hopkins team that is working on the tracker organically formed a year ago to think about ways to help children, initially releasing a tracker looking at school reopenings in the U.S.

“For kids from disadvantaged backgrounds, they’re going to be impacted much more severely,” she said.

“As we’ve had schools thinking about reopening or recovery, what are the students going to need, and what are students going to need the most? [We’ve been] doing issue-spotting, hopefully for educators and policymakers to think about providing the actual resources that are needed.”

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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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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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Investment Is Flooding India’s Ed-Tech Landscape, With Global Implications

India’s ed-tech sector is rapidly accelerating, riding a wave of momentum driven by increased investments and acquisitions, while its constellation of home-grown startups are adding new users to their platforms by the millions. 

So far in 2020, funding is smashing previous levels for India-based education startups, outpacing even investments made in U.S. ed-tech companies…

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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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A Venture Capitalist’s View of the Ed-Tech Market During COVID, and Beyond


Amit Patel, a managing director at Owl Ventures, talks about how his venture capital firm makes investment decisions, and the forces he sees in play in the market during COVID-19.

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