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Broad Congressional Proposal Would Raise Data Privacy Bar for Ed-Tech Companies

broad congressional proposal would raise data privacy bar for ed tech companies
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Broad Congressional Proposal Would Raise Data Privacy Bar for Ed-Tech Companies

A recently released congressional proposal would trigger a swath of new requirements for how ed-tech companies handle K-12 student data they collect, and establish an independent auditing process for their data protection practices.

The drafter of the proposed measure, Rep. Lori Trahan, D-Mass., is seeking input from ed-tech companies and other members of the K-12 community on what language should ultimately be included in final legislation she plans to introduce later this year.

The proposal suggests limiting usage of student data collected by education businesses in several ways, including prohibiting targeted advertising involving students’ personal information, and banning the sale of student data except in cases of company acquisitions and sales of test-score reports for college recruitment.

Trahan presented the proposed language to allow commercial transactions for test score data as one of several points of discussion for parents, educators, students, and industry, as her office works to craft a final bill sometime around early winter, she told EdWeek Market Brief in an interview.

Sale of test score data can be a contentious issue.

Privacy advocates often argue that assessment companies don’t thoroughly inform students and parents when selling data to colleges and scholarship providers. On the flip side, some civil rights advocates  assert that colleges’ purchases of test score data are useful for enrolling students from low-income school districts who may get overlooked by traditional recruitment efforts, Trahan noted.

“I believe that we can strike a thoughtful balance, and making this a point of discussion as we work on an updated draft of the legislation is key to achieving that,” she said.

Commenters have until Oct. 31 to provide input for final legislation to be introduced later this year.

In addition to prohibiting certain uses of student data, the draft legislation also outlines several allowable cases of student data disclosure for companies, including to ensure legal and regulatory compliance, participation in the judicial process, and research purposes allowed by federal or state law.

Trahan wants companies to share their views on the issue of allowable disclosure, including their experiences navigating state laws that trigger disclosure of student information, she said.

Small and midsize companies should also comment on the draft’s provision to establish “technology impact assessments” that examine the student-data collection practices of ed-tech companies, Trahan said.

The draft would task the Federal Trade Commission with organizing a process for technology impact assessments to be conducted by independent auditors of any education company deemed to host “high-risk” platforms for student data protection purposes.

Defining “High-Risk”

The draft bill defines several criteria for what would constitute “high-risk.”

Those  criteria include software platforms that pose a significant risk to privacy or security of students; store personal student information regarding race, national origin, political opinions, religion, sexual orientation, and criminal convictions; and, platforms that present the possibility of an inaccurate, unfair, biased, or discriminatory decision that impacts a student.

The independent technology impact assessments would be required to describe the data that companies collect, provide a risk analysis considering harms to students, discrimination, and accessibility; and, explain companies’ risk mitigation processes.

The draft bill identifies the provision for independent auditors to conduct technology impact assessments as a point of discussion for K-12 stakeholders to have in the leadup to a final bill.

Ed tech, including artificial intelligence-influenced ed tech, is not subject to the same certification requirements as other critical industries, such as the legal and accounting professions, which require many practitioners to undergo continuing education and outside auditing processes, Trahan said.

“Ideally, legislation like ours could provide the incentive to scholars and standards-making bodies to create a certified [ed tech] industry,” she said. “But you don’t arrive there until you hear from small and midsized companies so that we can understand the burden that may come with them hiring potentially expensive, and currently uncertified auditors.”

Though the draft bill  has not been formally introduced in Congress yet, Trahan hopes to work across party lines, as well as with lawmakers interested in relevant tech topics like AI, as her office draws up final legislation. Twenty-seven House lawmakers compose the bipartisan Congressional AI Caucus.

The draft measure is “extremely comprehensive,” and the public participation process will allow the K-12 community to address any potential gaps they might see in the legislation, said Ariel Fox, senior counsel for global policy at Common Sense Media.

Fox lauded the proposal for  establishing a formal process for external audits of companies’ data protection practices. In recent years, such provisions have generally been left out of ed-tech legislation proposed within the U.S.

The impact assessment provisions draw from language embedded in the EU’s General Data Protection Regulation, or GDPR, and the UK’s Age Appropriate Design Code. Both of those regulations direct companies covered by the regulations to deeply vet how their software impacts users’ privacy.

“A concept that we see a lot in international laws is this notion that companies should really take a hard look at what they’re doing with data, what they’re collecting, why they’re collecting it,” Fox said. “It’s exciting to see that in her proposal as well.”

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4 Ways for Education Companies Working Globally to Protect Their Intellectual Property

4 ways for education companies working globally to protect their intellectual property
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Lawyers, consultants, others advising education companies say there are clear steps businesses can take to protect their intellectual property abroad.

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K-12 Dealmaking: GoGuardian Acquires Formative Assessment Platform; Tutoring Startup Becomes Europe’s Latest Unicorn

k 12 dealmaking goguardian acquires formative assessment platform tutoring startup becomes europes latest unicorn
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GoGuardian, which provides a suite of classroom management and student safety solutions, has acquired Edulastic, the companies announced this week.

Edulastic describes itself as a next-generation formative online assessment platform that helps teachers quickly identify learning gaps, give students differentiated assignments to meet individual learning needs, and monitors students’ progress on the way to standards mastery.

The acquisition will advance Los Angeles-based GoGuardian’s mission to create the “ultimate learning platform,” the announcement says.

“Gauging student understanding is a vital element of effective teaching and learning. The Edulastic team has created sophisticated, data-driven solutions that provide teachers with real-time, actionable insights that support great teaching and improved outcomes,” GoGuardian co-founder and CEO Advait Shinde said in a statement. “We couldn’t be more excited to welcome the talented Edulastic team into the GoGuardian family.”

The companies estimate that the acquisition will allow their combined platform to reach one out of three K-12 students nationwide. GoGuardian already serves over 20 million students in more than 14 million schools, and Edulastic is used by more than 9 million students at more than 19,000 schools, according to the announcement.

“Since our founding, Edulastic has been on a mission to deliver insights that help teachers teach and help students learn,” Edulastic co-founder and CEO Madhu Narasa said in a statement. “GoGuardian is a natural fit that will accelerate our mission and expand our ability to serve educators, now and long into the future.”

The acquisition was led by GoGuardian and Sumeru Equity Partners, a technology-focused growth capital firm that first invested in GoGuardian in 2018. Edulastic is backed by early-stage venture capital firm Primera Capital.

Austrian tutoring startup announces investment, ‘unicorn’ status. After receiving a $244.4 million Series C investment led by DST Global, GoStudent announced it is Europe’s latest ed-tech unicorn and the highest-valued ed-tech company in Europe, according to an announcement.

The company is now valued at $1.7 billion, or €1.4 billion.

GoStudent, which is based in Vienna and provides one-to-one video-based online tutoring, also saw investments this round from SoftBank Vision Fund 2, Tencent, Dragoneer, Coatue, Left Lane Capital, and DN Capital.

The investment will be used to drive global expansion, according to the announcement. GoStudent is currently used in 15 countries, has expanded its team to more than 500 employees, and has opened 12 new offices, adding new locations in Athens, Istanbul, and Amsterdam.

The company aims to be present in over 20 countries by the end of 2021, planning to launch in Canada and Mexico this summer, and also intends to invest in branding, product development, and company acquisitions. GoStudent will also double its team to over 1,000 employees this year, the company said.

GoStudent grows by a rate of approximately 30 percent month-over-month, according to the announcement.

“At the heart of GoStudent is our mission to build the No. 1 Global School,” GoStudent co-founder and CEO Felix Ohswald said in a statement. “The new investment and the resulting opportunities for continued international growth bring us one step closer to fulfilling our mission.”

Apax Digital Fund invests in Revolution Prep. Private equity firm Apax Digital Fund will invest in online tutoring platform Revolution Prep, Apax announced.

The announcement doesn’t give a specific figure, but refers to the infusion as a “growth investment” that will allow Revolution Prep to expand its offering and increase access to world-class online tutoring.

The investment will enable Revolution Prep to make professional tutors available to more students in the U.S. and beyond, the announcement says. Over 1 million families have used the service.

“The pandemic has accelerated the shift from traditional to online learning and we’re continuing to see strong demand even as society is re-opening,” Revolution Prep CEO Matt Kirchner said in a statement. Apax Digital’s “investment will support an acceleration of our key growth priorities, including scaling up the more affordable small group tutoring format and the strategic expansion into the middle school tutoring segment, supporting families earlier in their academic journeys.”

Apax Digital Fund was attracted by Revolution Prep’s “cutting-edge” technology platform, longstanding partnerships with schools, and breadth and expertise of its tutors, Marcelo Gigliani, managing partner of Apax Digital said in a statement.

Lincoln International was the exclusive financial adviser to Revolution Prep in connection with the transaction.

ETS Strategic Capital and GSV Ventures invest in Degreed. Princeton, N.J.-based ETS Strategic Capital, the venture capital arm of research and assessment organization ETS, is joining GSV Ventures to invest in Degreed, a workforce upskilling company used by about one in three Fortune 50 companies, according to an announcement.

The investment is aimed to continue to advance and grow ETS’s educational business and mission through high-growth dealmaking, the announcement says.

San Francisco-based Degreed received a $153 million Series D funding round led by Sapphire Ventures and Riverwood Capital in April.

“Our investment in Degreed will help us to continue to leverage high-growth companies who are aligned to the business and mission of ETS and grow globally as an organization,” Ralph Taylor-Smith, managing director of ETS Strategic Capital, said in a statement. “The corporate learning, workforce development and reskilling/upskilling sector is a key new business growth area for ETS.”

The announcement cites a study by Statistia showing that $82.5 billion was invested in workplace training in the U.S. in 2020.

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ETS Acquires English Language Learning Test Assets for Japan

ets acquires english language learning test assets for japan
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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

global education recovery tracker offers country by country status on school reopening
GlobalEducationTracker
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 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

zooms big stamp on the k 12 market is poised to grow
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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

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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

europes largest ed tech vc firm launches second fund with 54 million
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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

a venture capitalists view of the ed tech market during covid and beyond
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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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