The “Who’s Who” of the European edtech scene descended on London on June 12 at Edtech Europe 2014, a conference organized by Edxus Group, a London company formed to acquire and consolidate European edtech companies, and IBIS Capital, a London-based specialist media investment and advisory firm.
Now in its second year, the day-long event attracted over 300 startup entrepreneurs, publishers, academics, investors and other stakeholders in European’s education scene. Notable edtech investors and entrepreneurs also arrived from across the Atlantic, including Deborah Quazzo (GSV Advisors), Don Burton (TechStars), Michael Staton (Learn Capital), Gregg Alpert (Pearson Catalyst), Ron Reed (SXSWedu) and Michael Bijaoui (East Wind Advisors).
At the opening of the conference, Benjamin Vedrenne-Cloquet, CEO of EdxusGroup, declared, “We have created Edtech Europe to connect the ecosystem within Europe and abroad, to bring forth the future edtech champions and promote the region’s success stories.”
Dollars and investments were certainly the main focus. While panels and discussions spanned topics like student engagement, mobile learning and vocational and corporate training, a recurring question was: Why have European edtech companies received such fewer investment dollars, in comparison to their American counterparts?
According to IBIS Capital, Europe accounts for 25% of the global $4.1 trillion spent on education, has more students than the U.S. (100 million students in western Europe, versus 80 million in the US) and employs 27% more teachers. But in 2013 only a total of $45 million was raised by European edtech companies, as compared to $430 million for those in the U.S. Here’s another way to look at it, based on research from IBIS Capital: U.S. companies accounted for 60% of global edtech fundraising, while only 8% went to European ones.
Charles McIntyre, CEO of IBIS Capital and one of the organizers of the event, called it “a market failure that the VC and financing community are not recognizing the opportunities in edtech. There is great talent, valuations are comparatively low and consumers are ready and demanding solutions.” Investors argued there should be more dollars given that European companies have recently shown successful exits, such as CrossKnowledge’s sale to Wiley for $175 million, Mendeley’s acquisition by Reed Elsevier for $69 to $100 million, video2brain’s merger with lynda.com and Area9’s sale to McGraw-Hill.
One reason that it hasn’t happened, suggested McIntyre, was that European investment firms tend to be conservative. When deals do happen, they tend to come from private high-net-worth individuals, instead of VCs. He called for a trans-Europe effort to establish a public-private investment vehicle, through which governments match edtech funding from private investors in order to stimulate and support edtech entrepreneurship.
The event also reminded attendees that there certainly isn’t a lack of promising startups in Europe. The conference concluded with the announcement of the EdTech 20, which recognized some of the continent's most innovative and fastest-growing edtech companies. This year the top three spots, in order, went to:
- Busuu, the world's largest social network for language learning;
- Bettermarks, an adaptive math learning platform with interactive textbooks; and
- TheStudentRoom, an online student community platform which boasts the world’s largest student community.
Other notable European early stage companies present at the conference included Gojimo, Makers Academy, Blikbook, iversity, Labster, Smart Sparrow, Squla, Fishtree, Skillpixels, Eliademy, Papagei and CareerFoundry.
By connecting European edtech entrepreneurs, raising awareness of their challenges and proposing calls to actions for policymakers and the investment community, Edtech Europe hopes to establish itself as main destination for the European industry’s biggest players. For 2015, organizers say the event is expected to grow three times, with satellite events within other European countries planned throughout the year.