State of Education: Ed Tech in 2015 —?Real Opportunity or Fool’s Gold?

In this series, professionals debate the state – and future – of their industry. Read all the posts here and write your own (use #MyIndustry in the body of your post).

Two years ago, I wrote a post for LinkedIn in which I asserted that education is having its Internet moment. Broadband, Wi-Fi and powerful mobile devices were becoming more accessible, the quality of digital content, learning apps, and tools was getting better and better, and I called for readers to accelerate innovation and scale up adoption of technology in education.

I haven't changed my opinion, and the numbers bear me out. The global education technology market is massive and continues to grow. According to Flybridge Capital Partners – which put together a fun and enlightening Ed Tech Market Map – education technology companies sell more than $1.3 trillion annually in K-12, post-secondary, and adult and professional learning products and services aimed at teachers, students, schools, and corporations around the world. These products and services include curricula, content, games, management systems, and professional development services.

In addition, venture capital and private equity investing in education technology companies is at an all time high. In 2014, VC and private equity investing in ed tech companies reached nearly $1.87 billion, up 55% percent from the previous year, according to data from CB Insights. According to EdSurge, in the first quarter of 2015, U.S. ed tech companies received $185 million more in funding than they received in the same period a year ago, topping $630 million.

The education technology industry is gaining more public visibility and interest for its role in solving some of our country’s (and our world’s) most difficult challenges. For example, xPrize, an organization that defines grand challenges and launches competitions to spur innovation, recently announced a $7 million global competition focused on technology solutions for low-literate adults. This is an area ripe for innovation, as I shared in a LinkedIn post earlier this year.

From the buyer side, technology budgets in U.S. schools and districts are healthy compared to the overall education budget scenario. According to surveys of education decision-makers conducted by EdNET Insight, nearly 90% of districts expected their 2014-2015 technology budgets to stay the same or increase.

That’s a lot of good news.

Yet, there is still more work needed to connect schools with the right ed tech products and services to meet their needs. At the core of the U.S. education technology market is our K-12 public education system – a highly fragmented collection of 14,000 school districts in 50 states, the District of Columbia, and three territories. It’s been a tough and often frustrating market for developers because interacting with the primary end users of products and services – teachers and students – is decentralized, and procurement processes, originally designed for the longer and simpler life of textbooks, are inefficient for a fast moving technology market.

Recently, though, efforts have been coalescing around ways of making it easier for companies to develop better products and bring them to market. For example, new education incubators and accelerators are providing seed capital in exchange for equity, information, strategic connections, and even workspaces for early stage ideas or companies. In some cases, they help developers with a great idea form an experienced management team and build companies around their innovations.

Examples of accelerators include the Intel Education Accelerator, AT&T’s Aspire Accelerator and the Jefferson Education Accelerator in Virginia. Examples of incubators include Boston’s LearnLaunch, Silicon Valley’s ImagineK12, and Chicago’s LEAP Innovations.

Another important development is the emergence of Education Innovation Clusters (EICs), which bring together educators, researchers, entrepreneurs, and investors within a geographic region to accelerate innovation and support the development of products as well as their use in schools. An example of an EIC is the Remake Learning network in Pittsburgh. The cluster has been operational for more than seven years and is thriving. Successes include coordinated funding for local programs and entrepreneurs, a formal program for connecting educators with researchers and research-backed technologies, and the Activation Lab, an iterative design studio focused on creating engaging learning environments for students.

Going forward, stronger partnerships between educators, entrepreneurs, and researchers will lead to smarter and better products, as well as smarter and more informed demand for learning technologies. Together, these stakeholders can create:

Better ideas. Ed tech developers working with education researchers can understand more about the science of how people learn, and use this knowledge to inform the development of their products.

Bigger ideas. K-12 education doesn’t need more standalone apps; it needs apps that can be combined with other approaches to improve learning. Educators can articulate their needs and challenges to inform both entrepreneurs and researchers.

Better evidence. The K-12 market can look to researchers to help develop better and timelier methods for testing products in classrooms so purchasing decisions and product improvements can be based on evidence.

Best information. A consumer report for learning technologies would provide consumers (end users and purchasers) with the best available information about all aspects of a product, including the evidence of its effectiveness, so they can make more informed decisions.

Deliberate collaboration between developers and entrepreneurs, education researchers, and educators is the best way to build on the momentum of a large and growing ed tech market. These collaborations are the key to unlocking the promise of technology and the Internet to amplify learning opportunities for all.

Karen Cator is President and CEO of Digital Promise, a non-profit whose mission is to vastly improve the opportunity for all Americans to learn by accelerating innovation in education through technology and research. From 2009-2013, Karen was Director of the Office of Educational Technology at the U.S. Department of Education.